[Title 20 CFR ]
[Code of Federal Regulations (annual edition) - April 1, 2012 Edition]
[From the U.S. Government Printing Office]



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                     Title 20

               Employees' Benefits


              ________________________

                Parts 500 to 656

            Revised as of April 1, 2012

          Containing a codification of documents of general 
          applicability and future effect

          As of April 1, 2012
                    Published by the Office of the Federal Register 
                    National Archives and Records Administration as a 
                    Special Edition of the Federal Register

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As of April 1, 2012

Title 20, Part 500 to End

Revised as of April 1, 2011

Is Replaced by

Title 20, Parts 500 to 656

and

Title 20, Part 657 to End



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                            Table of Contents



                                                                    Page
  Explanation.................................................     vii

  Title 20:
          Chapter IV--Employees' Compensation Appeals Board, 
          Department of Labor                                        3
          Chapter V--Employment and Training Administration, 
          Department of Labor                                       11
  Finding Aids:
      Table of CFR Titles and Chapters........................     813
      Alphabetical List of Agencies Appearing in the CFR......     833
      List of CFR Sections Affected...........................     843

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                     ----------------------------

                     Cite this Code: CFR
                     To cite the regulations in 
                       this volume use title, 
                       part and section number. 
                       Thus, 20 CFR 501.1 refers 
                       to title 20, part 501, 
                       section 1.

                     ----------------------------

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                               EXPLANATION

    The Code of Federal Regulations is a codification of the general and 
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parts covering specific regulatory areas.
    Each volume of the Code is revised at least once each calendar year 
and issued on a quarterly basis approximately as follows:

Title 1 through Title 16.................................as of January 1
Title 17 through Title 27..................................as of April 1
Title 28 through Title 41...................................as of July 1
Title 42 through Title 50................................as of October 1

    The appropriate revision date is printed on the cover of each 
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[[Page viii]]

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    Acting Director,
    Office of the Federal Register.
    April 1, 2012.







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                               THIS TITLE

    Title 20--Employees' Benefits is composed of four volumes. The first 
volume, containing parts 1-399, includes current regulations issued by 
the Office of Workers' Compensation Programs, Department of Labor and 
the Railroad Retirement Board. The second volume, containing parts 400-
499, includes all current regulations issued by the Social Security 
Administration. The third volume, containing parts 500 to 656, includes 
current regulations issued by the Employees' Compensation Appeals Board, 
and the Employment and Training Administration. The fourth volume, 
containing part 657 to End, includes the current regulations issued by 
the Office of Workers' Compensation Programs, the Benefits Review Board, 
the Office of the Assistant Secretary for Veterans' Employment and 
Training Service (all of the Department of Labor) and the Joint Board 
for the Enrollment of Actuaries. The contents of these volumes represent 
all current regulations codified under this title of the CFR as of April 
1, 2012.

    An index to chapter III appears in the second volume.

    For this volume, Cheryl E. Sirofchuck was Chief Editor. The Code of 
Federal Regulations publication program is under the direction of 
Michael L. White, assisted by Ann Worley.

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                      TITLE 20--EMPLOYEES' BENEFITS




                  (This book contains parts 500 to 656)

  --------------------------------------------------------------------
                                                                    Part

chapter iv--Employees' Compensation Appeals Board, 
  Department of Labor.......................................         501

chapter v--Employment and Training Administration, 
  Department of Labor.......................................         601

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 CHAPTER IV--EMPLOYEES' COMPENSATION APPEALS BOARD, DEPARTMENT OF LABOR




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Part                                                                Page
500             [Reserved]

501             Rules of procedure..........................           5

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                           PART 500 [RESERVED]



PART 501_RULES OF PROCEDURE--Table of Contents



Sec.
501.1 Definitions.
501.2 Scope and applicability of rules; composition and jurisdiction of 
          the Board.
501.3 Notice of appeal.
501.4 Case record; inspection; submission of pleadings and motions.
501.5 Oral argument.
501.6 Decisions and orders.
501.7 Petition for reconsideration.
501.8 Clerk of the Office of the Appellate Boards; docket of 
          proceedings; records.
501.9 Representation; appearances and fees.

    Authority: Federal Employees' Compensation Act (FECA), 5 U.S.C. 8101 
et seq.

    Source: 73 FR 62193, Oct. 20, 2008, unless otherwise noted.



Sec.  501.1  Definitions.

    (a) FECA means the Federal Employees' Compensation Act, 5 U.S.C. 
8101 et seq. and any statutory extension or application thereof.
    (b) The Board means the Employees' Compensation Appeals Board.
    (c) Chief Judge and Chairman of the Board means the Chairman of the 
Employees' Compensation Appeals Board.
    (d) Judge or Alternate Judge means a member designated and appointed 
by the Secretary of Labor with authority to hear and make final 
decisions on appeals taken from determinations and awards by the OWCP in 
claims arising under the FECA.
    (e) OWCP means the Office of Workers' Compensation Programs, 
Employment Standards Administration, U.S. Department of Labor.
    (f) Director means the Director of the Office of Workers' 
Compensation Programs or a person delegated authority to perform the 
functions of the Director. The Director of OWCP is represented before 
the Board by an attorney designated by the Solicitor of Labor.
    (g) Appellant means any person adversely affected by a final 
decision or order of the OWCP who files an appeal to the Board.
    (h) Representative means an individual properly authorized by an 
Appellant in writing to act for the Appellant in connection with an 
appeal before the Board. The Representative may be any individual or an 
attorney who has been admitted to practice and who is in good standing 
with any court of competent jurisdiction.
    (i) Decision, as prescribed by 5 U.S.C. 8149 of the FECA, means the 
final determinative action made by the Board on appeal of a claim.
    (j) Clerk or Office of the Clerk means the Clerk of the Office of 
the Appellate Boards.



Sec.  501.2  Scope and applicability of rules; composition and 
jurisdiction of the Board.

    (a) The regulations in this part establish the Rules of Practice and 
Procedure governing the operation of the Employees' Compensation Appeals 
Board.
    (b) The Board consists of three permanent judges, one of whom is 
designated as Chief Judge and Chairman of the Board, and such alternate 
judges as are appointed by the Secretary of Labor. The Chief Judge is 
the administrative officer of the Board. The functions of the Board are 
quasi-judicial. For organizational purposes, the Board is placed in the 
Office of the Secretary of Labor and sits in Washington, DC.
    (c) The Board has jurisdiction to consider and decide appeals from 
final decisions of OWCP in any case arising under the FECA. The Board 
may review all relevant questions of law, fact and exercises of 
discretion (or failure to exercise discretion) in such cases.
    (1) The Board's review of a case is limited to the evidence in the 
case record that was before OWCP at the time of its final decision. 
Evidence not before OWCP will not be considered by the Board for the 
first time on appeal.
    (2) There will be no appeal with respect to any interlocutory matter 
decided (or not decided) by OWCP during the pendency of a case.
    (3) The Board and OWCP may not exercise simultaneous jurisdiction 
over the same issue in a case on appeal. Following the docketing of an 
appeal before the Board, OWCP does not retain jurisdiction to render a 
further decision regarding the issue on appeal until after the Board 
relinquishes jurisdiction.

[[Page 6]]



Sec.  501.3  Notice of Appeal.

    (a) Who may file. Any person adversely affected by a final decision 
of the Director, or his or her authorized Representative, may file for 
review of such decision by the Board.
    (b) Place of filing. The notice of appeal shall be filed with the 
Clerk at 200 Constitution Avenue, NW., Washington, DC 20210.
    (c) Content of notice of appeal. A notice of appeal shall contain 
the following information:
    (1) Date of Appeal.
    (2) Full name, address and telephone number of the Appellant and the 
full name of any deceased employee on whose behalf an appeal is taken. 
In addition, the Appellant must provide a signed authorization 
identifying the full name, address and telephone number of his or her 
Representative, if applicable.
    (3) Employing establishment, and the date, description and place of 
injury.
    (4) Date and Case File Number assigned by OWCP concerning the 
decision being appealed to the Board.
    (5) A statement explaining Appellant's disagreement with OWCP's 
decision and stating the factual and/or legal argument in favor of the 
appeal.
    (6) Signature: An Appellant must sign the notice of appeal.
    (d) Substitution of appellant: Should the Appellant die after having 
filed an appeal with the Board, the appeal may proceed to decision 
provided there is the substitution of a proper Appellant who requests 
that the appeal proceed to decision by the Board.
    (e) Time limitations for filing. Any notice of appeal must be filed 
within 180 days from the date of issuance of a decision of the OWCP. The 
Board maintains discretion to extend the time period for filing an 
appeal if an applicant demonstrates compelling circumstances. Compelling 
circumstances means circumstances beyond the Appellant's control that 
prevent the timely filing of an appeal and does not include any delay 
caused by the failure of an individual to exercise due diligence in 
submitting a notice of appeal.
    (f) Date of filing. A notice of appeal complying with paragraph (c) 
of this section is considered to have been filed only if received by the 
Clerk by the close of business within the period specified under 
paragraph (e) of this section, except as otherwise provided in this 
subsection:
    (1) If the notice of appeal is sent by United States Mail or 
commercial carrier and use of the date of delivery as the date of filing 
would result in a loss of appeal rights, the appeal will be considered 
to have been filed as of the date of postmark or other carriers' date 
markings. The date appearing on the U.S. Postal Service postmark or 
other carriers' date markings (when available and legible) shall be 
prima facie evidence of the date of mailing. If there is no such 
postmark or date marking or it is not legible, other evidence, such as, 
but not limited to, certified mail receipts, certificate of service and 
affidavits, may be used to establish the mailing date. If a notice of 
appeal is delivered or sent by means other than United States Mail or 
commercial carrier, including personal delivery or fax, the notice is 
deemed to be received when received by the Clerk.
    (2) In computing the date of filing, the 180 day time period for 
filing an appeal begins to run on the day following the date of the OWCP 
decision. The last day of the period so computed shall be included, 
unless it is a Saturday, Sunday or Federal holiday, in which event the 
period runs to the close of the next business day.
    (g) Failure to timely file a notice of appeal. The failure of an 
Appellant or Representative to file an appeal with the Board within the 
period specified under paragraph (e) of this section, including any 
extensions granted by the Board in its discretion based upon compelling 
circumstances, will foreclose all right to review. The Board will 
dismiss any untimely appeal for lack of jurisdiction.
    (h) Incomplete notice of appeal. Any timely notice of appeal that 
does not contain the information specified in paragraph (c) of this 
section will be considered incomplete. On receipt by the Board, the 
Clerk will inform Appellant of the deficiencies in the notice of appeal 
and specify a reasonable time to submit the requisite information. Such 
appeal will be dismissed unless Appellant provides the requisite 
information in the time specified by the Clerk.

[[Page 7]]



Sec.  501.4  Case record; inspection; submission of pleadings 
and motions.

    (a) Service on OWCP and transmission of OWCP case record. The Board 
shall serve upon the Director a copy of each notice of appeal and 
accompanying documents. Within 60 days from the date of such service, 
the Director shall provide to the Board the record of the OWCP 
proceeding to which the notice refers. On application of the Director, 
the Board may, in its discretion, extend the time period for submittal 
of the OWCP case record.
    (b) Inspection of record. The case record on appeal is an official 
record of the OWCP.
    (1) Upon written application to the Clerk, an Appellant may request 
inspection of the OWCP case record. At the discretion of the Board, the 
OWCP case record may either be made available in the Office of the Clerk 
of the Appellate Boards for inspection by the Appellant, or the request 
may be forwarded to the Director so that OWCP may make a copy of the 
OWCP case record and forward this copy to the Appellant. Inspection of 
the papers and documents included in the OWCP case record of any appeal 
pending before the Board will be permitted or denied in accordance with 
5 CFR 10.10 to 10.13. The Chief Judge (or his or her designee) shall 
serve as the disclosure officer for purposes of Appendix A to 29 CFR 
Parts 70 and 71.
    (2) Copies of the documents generated in the course of the appeal 
before the Board will be provided to the Appellant and Appellant's 
Representative by the Clerk. If the Appellant needs additional copies of 
such documents while the appeal is pending, the Appellant may obtain 
this information by contacting the Clerk. Pleadings and motions filed 
during the appeal in proceedings before the Board will be made part of 
the official case record of the OWCP.
    (c) Pleadings. The Appellant, the Appellant's Representative and the 
Director may file pleadings supporting their position and presenting 
information, including but not limited to briefs, memoranda of law, 
memoranda of justification, and optional form AB-1. All pleadings filed 
must contain the docket number and be filed with the Clerk. The Clerk 
will issue directions specifying the time allowed for any responses and 
replies.
    (1) The Clerk will distribute copies of any pleading received by the 
Clerk to ensure that the Appellant, his or her Representative and the 
Director receive all pleadings. Any pleading should be submitted within 
60 days of the filing of an appeal. The Board may, in its discretion, 
extend the time period for the submittal of any pleading.
    (2) Proceedings before the Board are informal and there is no 
requirement that any pleading be filed. Failure to submit a pleading or 
to timely submit a pleading does not prejudice the rights of either the 
Appellant or the Director.
    (3) Upon receipt of a pleading, the Appellant and the Director will 
have the opportunity to submit a response to the Board.
    (d) Motions. Motions are requests for the Board to take specific 
action in a pending appeal. Motions include, but are not limited to, 
motions to dismiss, affirm the decision below, remand, request a 
substitution, request an extension of time, or other such matter as may 
be brought before the Board. Motions may be filed by the Appellant, the 
Appellant's Representative and the Director. The motion must be in 
writing, contain the docket number, state the relief requested and the 
basis for the relief requested, and be filed with the Clerk. Any motion 
received will be sent by the Clerk to ensure that the Appellant, his or 
her Representative and the Director receive all motions. The Clerk will 
issue directions specifying the timing of any responses and replies. The 
Board also may act on its own to issue direction in pending appeals, 
stating the basis for its determination.
    (e) Number of copies. All filings with the Board, including any 
notice of appeal, pleading, or motion shall include an original and two 
(2) legible copies.



Sec.  501.5  Oral argument.

    (a) Oral argument. Oral argument may be held in the discretion of 
the Board, on its own determination or on application by Appellant or 
the Director.
    (b) Request. A request for oral argument must be submitted in 
writing to

[[Page 8]]

the Clerk. The application must specify the issue(s) to be argued and 
provide a statement supporting the need for oral argument. The request 
must be made no later than 60 days after the filing of an appeal. Any 
appeal in which a request for oral argument is not granted by the Board 
will proceed to a decision based on the case record and any pleadings 
submitted.
    (c) Notice of argument. If a request for oral argument is granted, 
the Clerk will notify the Appellant and the Director at least 30 days 
before the date set for argument. The notice of oral argument will state 
the issues that the Board has determined will be heard.
    (d) Time allowed. Appellant and any Representative for the Director 
shall be allowed no more than 30 minutes to present oral argument. The 
Board may, in its discretion, extend the time allowed.
    (e) Appearances. An Appellant may appear at oral argument before the 
Board or designate a Representative. Argument shall be presented by the 
Appellant or a Representative, not both. The Director may be represented 
by an attorney with the Solicitor of Labor. Argument is limited to the 
evidence of record on appeal.
    (f) Location. Oral argument is heard before the Board only in 
Washington, DC. The Board does not reimburse costs associated with 
attending oral argument.
    (g) Continuance. Once oral argument has been scheduled by the Board, 
a continuance will not be granted except on a showing of good cause. 
Good cause may include extreme hardship or where attendance by an 
Appellant or Representative is mandated at a previously scheduled 
judicial proceeding. Any request for continuance must be received by the 
Board at least 15 days before the date scheduled for oral argument and 
be served by the requester upon Appellant and the Director. No request 
for a second continuance will be entertained by the Board. In such case, 
the appeal will proceed to a decision based on the case record. The 
Board may reschedule or cancel oral argument on its own motion at any 
time.
    (h) Nonappearance. The absence of an Appellant, his or her 
Representative, or the Director at the time and place set for oral 
argument will not delay the Board's resolution of an appeal. In such 
event, the Board may, in its discretion, reschedule oral argument, or 
cancel oral argument and treat the case as submitted on the case record.



Sec.  501.6  Decisions and orders.

    (a) Decisions. A decision of the Board will contain a written 
opinion setting forth the reasons for the action taken and an 
appropriate order. The decision is based on the case record, all 
pleadings and any oral argument. The decision may consist of an 
affirmance, reversal or remand for further development of the evidence, 
or other appropriate action.
    (b) Panels. A decision of not less than two judges will be the 
decision of the Board.
    (c) Issuance. The date of the Board's decision is the date of 
issuance or such date as determined by the Board. Issuance is not 
determined by the postmark on any letter containing the decision or the 
date of actual receipt by Appellant or the Director.
    (d) Finality. The decisions and orders of the Board are final as to 
the subject matter appealed, and such decisions and orders are not 
subject to review, except by the Board. The decisions and orders of the 
Board will be final upon the expiration of 30 days from the date of 
issuance unless the Board has fixed a different period of time therein. 
Following the expiration of that time, the Board no longer retains 
jurisdiction over the appeal unless a timely petition for 
reconsideration is submitted and granted.
    (e) Dispositive orders. The Board may dispose of an appeal on a 
procedural basis by issuing an appropriate order disposing of part or 
all of a case prior to reaching the merits of the appeal. The Board may 
proceed to an order on its own or on the written motion of Appellant or 
the Director.
    (f) Service. The Board will send its decisions and orders to the 
Appellant, his or her Representative and the Director at the time of 
issuance.



Sec.  501.7  Petition for reconsideration.

    (a) Time for filing. The Appellant or the Director may file a 
petition for reconsideration of a decision or order

[[Page 9]]

issued by the Board within 30 days of the date of issuance, unless 
another time period is specified in the Board's order.
    (b) Where to File. The petition must be filed with the Clerk. Copies 
will be sent by the Clerk to the Director, the Appellant and his or her 
Representative in the time period specified by the Board.
    (c) Content of petition. The petition must be in writing. The 
petition must contain the docket number, specify the matters claimed to 
have been erroneously decided, provide a statement of the facts upon 
which the petitioner relies, and a discussion of applicable law. New 
evidence will not be considered by the Board in a petition for 
reconsideration.
    (d) Panel. The panel of judges who heard and decided the appeal will 
rule on the petition for reconsideration. If any member of the original 
panel is unavailable, the Chief Judge may designate a new panel member. 
The decision or order of the Board will stand as final unless vacated or 
modified by the vote of at least two members of the reconsideration 
panel.
    (e) Answer. Upon the filing of a petition for reconsideration, 
Appellant or the Director may file an answer to the petition within such 
time as fixed by the Board.
    (f) Oral argument and decision on reconsideration. An oral argument 
may be allowed at the discretion of the Board upon application of the 
Appellant or Director or the Board may proceed to address the matter 
upon the papers filed. The Board shall grant or deny the petition for 
reconsideration and issue such orders as it deems appropriate.



Sec.  501.8  Clerk of the Office of the Appellate Boards; docket of
proceedings; records.

    (a) Location and business hours. The Office of the Clerk of the 
Appellate Boards is located at 200 Constitution Avenue, NW., Washington, 
DC 20210. The Office of the Clerk is open during business hours on all 
days except Saturdays, Sundays and Federal holidays, from 8:30 a.m. to 5 
p.m.
    (b) Docket. The Clerk will maintain a docket containing a record of 
all proceedings before the Board. Each docketed appeal will be assigned 
a number in chronological order based upon the date on which the notice 
of appeal is received. While the Board generally hears appeals in the 
order docketed, the Board retains discretion to change the order in 
which a particular appeal will be considered. The Clerk will prepare a 
calendar of cases submitted or awaiting oral argument and such other 
records as may be required by the Board.
    (c) Publication of decisions. Final decisions of the Board will be 
published in such form as to be readily available for inspection by the 
general public.



Sec.  501.9  Representation; appearances and fees.

    (a) Representation. In any proceeding before the Board, an Appellant 
may appear in person or by appointing a duly authorized individual as 
his or her Representative.
    (1) Counsel. The designated Representative may be an attorney who 
has been admitted to practice and who is in good standing with any court 
of competent jurisdiction.
    (2) Lay representative. A non-attorney Representative may represent 
an Appellant before the Board. He or she may be an accredited 
Representative of an employee organization.
    (3) Former members of the Board and other employees of the 
Department of Labor. A former judge of the Board is not allowed to 
participate as counsel or other Representative before the Board in any 
proceeding until two years from the termination of his or her status as 
a judge of the Board. The practice of a former judge or other former 
employee of the Department of Labor is governed by 29 CFR Part 0, 
Subpart B.
    (b) Appearance. No individual may appear as a Representative in a 
proceeding before the Board without first filing with the Clerk a 
written authorization signed by the Appellant to be represented. When 
accepted by the Board, such Representative will continue to be 
recognized unless the Representative withdraws or abandons such capacity 
or the Appellant directs otherwise.
    (c) Change of address. Each Appellant and Representative authorized 
to appear before the Board must give the

[[Page 10]]

Clerk written notice of any change to the address or telephone number of 
the Appellant or Representative. Such notice must identify the docket 
number and name of each pending appeal for that Appellant, or, in the 
case of a Representative, in which he or she is a Representative before 
the Board. Absent such notice, the mailing of documents to the address 
most recently provided to the Board will be fully effective.
    (d) Debarment of Counsel or Representative. In any proceeding, 
whenever the Board finds that a person acting as counsel or other 
Representative for the Appellant or the Director, is guilty of unethical 
or unprofessional conduct, the Board may order that such person be 
excluded from further acting as counsel or Representative in such 
proceeding. Such order may be appealed to the Secretary of Labor or his 
or her designee, but proceedings before the Board will not be delayed or 
suspended pending disposition of such appeal. However, the Board may 
suspend the proceeding of an appeal for a reasonable time for the 
purpose of enabling Appellant or the Director to obtain different 
counsel or other Representative. Whenever the Board has issued an order 
precluding a person from further acting as counsel or Representative in 
a proceeding, the Board will, within a reasonable time, submit to the 
Secretary of Labor or his or her designee a report of the facts and 
circumstances surrounding the issuance of such order. The Board will 
recommend what action the Secretary of Labor should take in regard to 
the appearance of such person as counsel or Representative in other 
proceedings before the Board. Before any action is taken debarring a 
person as counsel or Representative from other proceedings, he or she 
will be furnished notice and the opportunity to be heard on the matter.
    (e) Fees for attorney, Representative, or other services. No claim 
for a fee for legal or other service performed on appeal before the 
Board is valid unless approved by the Board. Under 18 U.S.C. 292, 
collecting a fee without the approval of the Board may constitute a 
misdemeanor, subject to fine or imprisonment for up to a year or both. 
No contract for a stipulated fee or on a contingent fee basis will be 
approved by the Board. No fee for service will be approved except upon 
written application to the Clerk, supported by a statement of the extent 
and nature of the necessary work performed before the Board on behalf of 
the Appellant. The fee application will be served by the Clerk on the 
Appellant and a time set in which a response may be filed. Except where 
such fee is de minimis, the fee request will be evaluated with 
consideration of the following factors:
    (1) Usefulness of the Representative's services;
    (2) The nature and complexity of the appeal;
    (3) The capacity in which the Representative has appeared;
    (4) The actual time spent in connection with the Board appeal; and
    (5) Customary local charges for similar services.

[[Page 11]]



 CHAPTER V--EMPLOYMENT AND TRAINING ADMINISTRATION, DEPARTMENT OF LABOR




  --------------------------------------------------------------------
Part                                                                Page
601             Administrative procedure....................          13
602             Quality control in the Federal-State 
                    unemployment insurance system...........          16
603             Federal-State Unemployment Compensation (UC) 
                    Program; confidentiality and disclosure 
                    of State UC information.................          24
604             Regulations for eligibility for unemployment 
                    compensation............................          35
606             Tax credits under the Federal Unemployment 
                    Tax Act; advances under Title XII of the 
                    Social Security Act.....................          38
609             Unemployment compensation for Federal 
                    civilian employees......................          47
614             Unemployment compensation for ex-
                    servicemembers..........................          59
615             Extended benefits in the Federal-State 
                    Unemployment Compensation Program.......          80
616             Interstate arrangement for combining 
                    employment and wages....................          98
617             Trade adjustment assistance for workers 
                    under the Trade Act of 1974.............         102
618             Trade adjustment assistance under the Trade 
                    Act of 1974, as amended.................         152
619-621         [Reserved]

625             Disaster unemployment assistance............         155
626             Introduction to the regulations under the 
                    Job Training Partnership Act............         180
627             General provisions governing programs under 
                    Titles I, II, and III of the act........         189
628             Programs under Title II of the Job Training 
                    Partnership Act.........................         233
629-630         [Reserved]

631             Programs under Title III of the Job Training 
                    Partnership Act.........................         253

[[Page 12]]

632             Indian and Native American employment and 
                    training programs.......................         272
633             Migrant and seasonal farmworker programs....         302
634             Labor market information programs under 
                    Title IV, Part E of the Job Training 
                    Partnership Act.........................         317
636             Complaints, investigations and hearings.....         318
637             Programs under Title V of the Job Training 
                    Partnership Act.........................         326
638             Job Corps program under Title IV-B of the 
                    Job Training Partnership Act............         329
639             Worker adjustment and retraining 
                    notification............................         350
640             Standard for benefit payment promptness--
                    unemployment compensation...............         360
641             Provisions governing the Senior Community 
                    Service Employment Program..............         363
645             Provisions governing welfare-to-work grants.         404
646             [Reserved]

650             Standard for appeals promptness--
                    unemployment compensation...............         427
651             General provisions governing the Federal-
                    State Employment Service System.........         428
652             Establishment and functioning of State 
                    employment services.....................         433
653             Services of the Employment Service System...         441
654             Special responsibilities of the Employment 
                    Service System..........................         459
655             Temporary employment of foreign workers in 
                    the United States.......................         468
656             Labor certification process for permanent 
                    employment of aliens in the United 
                    States..................................         780

[[Page 13]]



PART 601_ADMINISTRATIVE PROCEDURE--Table of Contents



  Subpart A_Approval, Certification and Findings With Respect to State 
  Laws and Plans of Operation for Normal and Additional Tax Credit and 
                             Grant Purposes

Sec.
601.1 General.
601.2 Approval of State unemployment compensation laws.
601.3 Findings with respect to State laws and plans of operation.
601.4 Certification for tax credit.
601.5 Withholding payments and certifications.

                  Subpart B_Grants, Advances and Audits

601.6 Grants for administration of unemployment compensation laws and 
          employment service.
601.7 [Reserved]
601.8 Agreement with Postmaster General.
601.9 Audits.

    Authority: 5 U.S.C. 301; 26 U.S.C. Chapter 23; 29 U.S.C. 49k; 38 
U.S.C. Chapters 41 and 42; 39 U.S.C. 3202(a)(1)(E) and 3202 note; 42 
U.S.C. 1302; and Secretary of Labor's Order No. 4-75, 40 FR 18515.

    Source: 15 FR 5886, Aug. 31, 1950; 23 FR 1267, Mar. 1, 1958, unless 
otherwise noted.

    Editorial Note: Nomenclature changes to part 601 appear at 71 FR 
35512, June 21, 2006.



  Subpart A_Approval, Certification and Findings With Respect to State 
  Laws and Plans of Operation for Normal and Additional Tax Credit and 
                             Grant Purposes



Sec.  601.1  General.

    (a) State unemployment compensation laws are approved and certified 
as provided in section 3304 of the Internal Revenue Code of 1986; 
findings are made regarding reduced rates permitted by a State law 
(section 3303(a) of the Internal Revenue Code of 1986) and such laws are 
certified as provided in section 3303(b) of the Internal Revenue Code of 
1986; findings are made regarding the inclusion of specified provisions 
(section 303(a) of the Social Security Act) in State laws approved under 
section 3304(a) of the Internal Revenue Code of 1986; findings are made 
whether the States have accepted the provisions of the Wagner-Peyser Act 
and whether their plans of operation for public employment offices 
comply with the provisions of said Act.
    (b) Normal and additional tax credit is given to taxpayers against 
taxes imposed by section 3301 of the Internal Revenue Code of 1986.
    (c) Grants of funds are made to States for administration of their 
employment security laws if their unemployment compensation laws and 
their plans of operation for public employment offices meet required 
conditions of Federal law. (Section 303(a) of the Social Security Act; 
section 3304(a) of the Internal Revenue Code of 1986; sections 6, 7, and 
8 of the Wagner-Peyser Act.)
    (d) As used throughout this Part, the terms ``Secretary'' or 
``Secretary of Labor'' shall refer to the Secretary of Labor, U.S. 
Department of Labor, or his or her designee.

[15 FR 5886, Aug. 31, 1950; 23 FR 1267, Mar. 1, 1958, as amended at 61 
FR 19983, May 3, 1996]



Sec.  601.2  Approval of State unemployment compensation laws.

    States may at their option submit their unemployment compensation 
laws for approval (section 3304(a) of the Internal Revenue Code of 
1986).
    (a) Submission. The States submit to the Employment and Training 
Administration (ETA), one copy of the State unemployment compensation 
law properly certified by an authorized State official to be true and 
complete, together with a written request for approval.
    (b) [Reserved]
    (c) Approval. The Secretary of Labor determines whether the State 
law contains the provisions required by section 3304(a) of the Internal 
Revenue Code of 1986. If the State law is approved, the Secretary 
notifies the Governor of the State within 30 days of the submission of 
such law.
    (d) Certification. On October 31 of each taxable year the Secretary 
of Labor certifies, for the purposes of normal tax credit (section 
3302(a)(1) of the Internal Revenue Code of 1986), to the Secretary of 
the Treasury each State

[[Page 14]]

the law of which the Secretary has previously approved. (See alsoSec. 
601.5.)

(Approved by the Office of Management and Budget under control number 
1205-0222)

[15 FR 5886, Aug. 31, 1950; 23 FR 1267, Mar. 1, 1958, as amended at 49 
FR 18295, Apr. 30, 1984; 50 FR 51241, Dec. 16, 1985; 71 FR 35513, June 
21, 2006]



Sec.  601.3  Findings with respect to State laws and plans of operation.

    For purposes of grants, findings are made regarding the inclusion in 
State unemployment compensation laws, approved under section 3304(a) of 
the Internal Revenue Code of 1986, of provisions required by section 
303(a) of the Social Security Act (seeSec. 601.2); findings are also 
made whether a State has accepted the provisions of the Wagner-Peyser 
Act and whether its plan of operation for public employment offices 
complies with the provisions of said act. For purposes of additional tax 
credit, findings are made regarding reduced rates of contributions 
permitted by the State law (section 3303(a) (1) of the Internal Revenue 
Code of 1986).

So that the Secretary of Labor may be enabled to determine the status of 
State laws and plans of operation, all relevant State materials, such as 
statutes, executive and administrative orders, legal opinions, rules, 
regulations, interpretations, court decisions, etc., are required to be 
submitted currently.
    (a) Submission. The States submit currently to the ETA one copy of 
relevant State material, properly certified by an authorized State 
official to be true and complete.
    (b) [Reserved]
    (c) Findings. The Secretary makes findings as provided in the cited 
sections of the Federal law. In the event that the Secretary is unable 
to make the findings required for certification for payment or for 
certification of the law for purposes of additional tax credit, further 
discussions with State officials are undertaken.

(Approved by the Office of Management and Budget under control number 
1205-0222)

[15 FR 5886, Aug. 31, 1950; 23 FR 1267, Mar. 1, 1958, as amended at 49 
FR 18295, Apr. 30, 1984; 50 FR 51241, Dec. 16, 1985; 71 FR 35513, June 
21, 2006]



Sec.  601.4  Certification for tax credit.

    (a) Within 30 days after submittal of a State unemployment 
compensation law for such purpose, the Secretary certifies to the State 
agency, in accordance with the provisions of section 3303(b)(3) of the 
Internal Revenue Code of 1986, the Secretary's findings regarding 
reduced rates of contributions allowable under such law. On October 31 
of each taxable year the Secretary certifies to the Secretary of the 
Treasury the law of each State, certified with respect to such year 
under section 3304 of the Internal Revenue Code of 1986 (seeSec. 
601.2), which the Secretary finds allows reduced rates with respect to 
such taxable year only in accordance with the provisions of section 
3303(a) of the Internal Revenue Code of 1986.
    (b) With regard to certification for payment, seeSec. 601.6.

[15 FR 5886, Aug. 31, 1950; 23 FR 1267, Mar. 1, 1958, as amended at 71 
FR 35513, June 21, 2006]



Sec.  601.5  Withholding payments and certifications.

    (a) When withheld. Payment of funds to States or yearend 
certification of State laws, or both, are withheld when the Secretary 
finds, after reasonable notice and opportunity for hearing:
    (1) That any provision required by section 303(a) of the Social 
Security Act is no longer included in the State unemployment 
compensation law; or
    (2) That the State unemployment compensation law has been so changed 
as no longer to meet the conditions required by section 3303(a) of the 
Internal Revenue Code of 1986 (section 3303(b)(3) of the Internal 
Revenue Code); or
    (3) That the State unemployment compensation law has been so amended 
as no longer to contain the provisions specified in section 3304(a) or 
has failed to comply substantially with any such provision and such 
finding has become effective (section 3304(c) of the Internal Revenue 
Code of 1986); or
    (4) That in the administration of the State unemployment 
compensation law there has been a failure to comply substantially with 
required provisions of such law (section 303(b)(2) of the Social 
Security Act and section 3303(b)(3) of the Internal Revenue Code of 
1986); or

[[Page 15]]

    (5) That in the administration of the State unemployment 
compensation law there has been a denial, in a substantial number of 
cases, of benefits due under such law, except that there may be no such 
finding until the question of entitlement has been decided by the 
highest judicial authority given jurisdiction under such State law 
(section 303(b)(1) of the Social Security Act); or
    (6) That a State fails to make its unemployment compensation records 
available to the Railroad Retirement Board or fails to cooperate with 
Federal agencies charged with the administration of unemployment 
compensation laws (section 303(c) of the Social Security Act); or
    (7) That a State no longer has a plan of operation for public 
employment offices complying with the provisions of the Wagner-Peyser 
Act; or
    (8) That a State agency has not properly expended, in accordance 
with an approved plan of operation, the Federal monies paid it for 
administration of its public employment service.
    (b) Informal discussion. Such hearings are generally not called, 
however, until after every reasonable effort has been made by ETA 
representatives to resolve the question involved by conference and 
discussion with State officials. Formal notification of the date and 
place of a hearing does not foreclose further negotiations with State 
officials.
    (c) Notice of noncertification. If, at any time during the taxable 
year, the Secretary of Labor has reason to believe that a State whose 
unemployment compensation law he/she has previously approved may not be 
certified, the Secretary promptly notifies the Governor of the State to 
that effect (section 3304(d) of the Internal Revenue Code of 1986).
    (d) Notice of hearing. Notice of hearing is sent by the Secretary of 
Labor to the State unemployment compensation agency. The notice sets 
forth the purpose of the hearing, the time, date, and place at which the 
hearing will be held, and the rules of procedure which will be followed. 
At a hearing the State is given an opportunity to present arguments and 
all relevant evidence, written or oral. The Secretary makes the 
necessary determination or findings, on the basis of the record of such 
hearings. A notice of the Secretary's determination or finding is sent 
to the State unemployment compensation agency.
    (e) Civil Rights Act issues. To the extent that any proposed 
withholding of funds involves circumstances within the scope of title VI 
of the Civil Rights Act of 1964 and the regulations promulgated 
thereunder, the procedure set forth in 29 CFR part 31 shall be 
applicable.

[30 FR 6942, May 22, 1965, as amended at 43 FR 13828, Mar. 31, 1978; 71 
FR 35513, June 21, 2006]



                  Subpart B_Grants, Advances and Audits



Sec.  601.6  Grants for administration of unemployment compensation
laws and employment service.

    Grants of funds for administration of State unemployment 
compensation laws and public employment service programs are made to 
States under section 302(a) of the Social Security Act, the Wagner-
Peyser Act, and the Appropriation Acts.
    (a) Requests for funds. The forms and instructions used by State 
agencies in requesting funds are available on the ETA Web site (http://
www.ows.doleta.gov/rjm). The forms and instructions call for detailed 
information for each budgetary period concerning the specific amounts 
requested for personal services and other current expenses of State 
agencies, supported by workload and unit-cost estimates. Supplementary 
budget requests are processed in the same manner as regular requests. 
The Administration's representatives in the regional offices furnish 
assistance to the State agencies in preparing requests for funds.
    (b) Processing of requests. (1) State agencies send their requests 
for funds to the Regional Administrator who reviews the requests and 
forwards them to the ETA National Office with his/her recommendation as 
to the amounts necessary for proper and efficient administration of the 
State unemployment compensation law and employment service program.
    (2) The ETA National Office appraises the requests and the 
recommendations

[[Page 16]]

of the regional representatives from a nationwide point of view, 
examining each State's request in the light of the experience of other 
States to insure equitable treatment among the States in the allocation 
of funds made available by Congress for the administration of State 
unemployment compensation laws and public employment service programs.
    (c) Action by ETA National Office. If the ETA National Office 
approves the State's budget request, the State agency is notified; and, 
provided the conditions precedent to grants continue during the 
budgetary period, certifications for payment, under the approved budget, 
stating the amounts, are made by the ETA National Office to the 
Secretary of the Treasury quarterly. Upon denial of a request, in whole 
or in part, the State agency is notified and the Regional Administrator 
is instructed to negotiate with the State with a view to removing the 
basis for denial.

(Approved by the Office of Management and Budget under control number 
1205-0132)

[15 FR 5886, Aug. 31, 1950, as amended at 42 FR 4724, Jan. 25, 1977; 49 
FR 18295, Apr. 30, 1984; 71 FR 35513, June 21, 2006]



Sec.  601.7  [Reserved]



Sec.  601.8  Agreement with Postmaster General.

    The Secretary of Labor and the Postmaster General have been directed 
by the Congress (title II of the Labor-Federal Security Agency 
Appropriation Act, 1950) to prescribe a mutually satisfactory procedure 
whereby official State employment security postal matter will be handled 
without the prepayment of postage. In lieu of such prepayments, the 
Secretary periodically certifies to the Secretary of the Treasury for 
payment to the U.S. Postal Service the amount necessary to cover the 
cost of State agency mailings. The amount of payment is based on a 
formula agreed upon by the Secretary of Labor and the U.S. Postal 
Service.

[15 FR 5886, Aug. 31, 1950, as amended at 42 FR 4724, Jan. 25, 1977]



Sec.  601.9  Audits.

    The Department of Labor's audit regulations at 29 CFR Part 96 and 29 
CFR Part 99 shall apply with respect to employment service and 
unemployment compensation programs.

[46 FR 7766, Jan. 23, 1981, as amended at 71 FR 35513, June 21, 2006]



PART 602_QUALITY CONTROL IN THE FEDERAL-STATE UNEMPLOYMENT INSURANCE 
SYSTEM--Table of Contents



                      Subpart A_General Provisions

Sec.
602.1 Purpose.
602.2 Scope.

                     Subpart B_Federal Requirements

602.10 Federal law requirements.
602.11 Secretary's interpretation.

                    Subpart C_State Responsibilities

602.20 Organization.
602.21 Standard methods and procedures.
602.22 Exceptions.

                   Subpart D_Federal Responsibilities

602.30 Management.
602.31 Oversight.

               Subpart E_Quality Control Grants to States

602.40 Funding.
602.41 Proper expenditure of Quality Control granted funds.
602.42 Effect of failure to implement Quality Control program.
602.43 No incentives or sanctions based on specific error rates.

Appendix A to Part 602--Standard For Claim Determinations--Separation 
          Information

    Authority: 42 U.S.C. 1302.

    Source: 52 FR 33528, Sept. 3, 1987, unless otherwise noted.

    Editorial Note: Nomenclature changes to part 602 appear at 71 FR 
35513, June 21, 2006.



                      Subpart A_General Provisions



Sec.  602.1  Purpose.

    The purpose of this part is to prescribe a Quality Control (QC) 
program for the Federal-State unemployment compensation (UC) system, 
which is applicable to the State UC programs and the Federal 
unemployment benefit and allowance programs administered by the State 
unemployment compensation agencies under agreements between the States 
and the Secretary of

[[Page 17]]

Labor (Secretary). QC will be a major tool to assess the timeliness and 
accuracy of State administration of the UC program. It is designed to 
identify errors in claims processes and revenue collections (including 
payments in lieu of contributions and Extended Unemployment Compensation 
Account collections), analyze causes, and support the initiation of 
corrective action.

[52 FR 33528, Sept. 3, 1987, as amended at 71 FR 35513, June 21, 2006]



Sec.  602.2  Scope.

    This part applies to all State laws approved by the Secretary under 
the Federal Unemployment Tax Act (section 3304 of the Internal Revenue 
Code of 1986, 26 U.S.C. section 3304), to the administration of the 
State laws, and to any Federal unemployment benefit and allowance 
program administered by the State unemployment compensation agencies 
under agreements between the States and the Secretary. QC is a 
requirement for all States, initially being applicable to the largest 
permanently authorized programs (regular UC including Combined-Wage-
Claims) and federally-funded programs (Unemployment Compensation for Ex-
Servicemembers and Unemployment Compensation for Federal Employees). 
Other elements of the QC program (e.g., interstate, extended benefit 
programs, benefit denials, and revenue collections) will be phased in 
under a schedule determined by the Department in consultation with State 
agencies.

[52 FR 33528, Sept. 3, 1987, as amended at 71 FR 35513, June 21, 2006]



                     Subpart B_Federal Requirements



Sec.  602.10  Federal law requirements.

    (a) Section 303(a)(1) of the Social Security Act (SSA), 42 U.S.C. 
503(a)(1), requires that a State law include provision for:

    Such methods of administration . . . as are found by the Secretary 
of Labor to be reasonably calculated to insure full payment of 
unemployment compensation when due.

    (b) Section 303(a)(6), SSA, 42 U.S.C. 505(a)(6), requires that a 
State law include provision for:

    The making of such reports, in such form and containing such 
information, as the Secretary of Labor may from time to time require, 
and compliance with such provisions as the Secretary of Labor may from 
time to time find necessary to assure the correctness and verification 
of such reports.

    (c) Section 303(b), SSA, 42 U.S.C. 503(b), provides in part that:

    Whenever the Secretary of Labor, after reasonable notice and 
opportunity for hearing to the State agency charged with the 
administration of the State law, finds that in the administration of the 
law there is--

                                * * * * *

    (2) a failure to comply substantially with any provision specified 
in subsection (a);

the Secretary of Labor shall notify such State agency that further 
payments will not be made to the State until the Secretary of Labor is 
satisfied that there is no longer any such denial or failure to comply. 
Until he is so satisfied, he shall make no further certification to the 
Secretary of the Treasury with respect to such State . . . .

    (d) Certification of payment of granted funds to a State is withheld 
only when the Secretary finds, after reasonable notice and opportunity 
for hearing to the State agency--
    (1) That any provision required by section 303(a) of the Social 
Security Act is no longer included in the State UC law, or
    (2) That in the administration of the State UC law there has been a 
failure to comply substantially with any required provision of such law.

[52 FR 33528, Sept. 3, 1987, as amended at 71 FR 35513, June 21, 2006]



Sec.  602.11  Secretary's interpretation.

    (a) The Secretary interprets section 303(a)(1), SSA, to require that 
a State law provide for such methods of administration as will 
reasonably ensure the prompt and full payment of unemployment benefits 
to eligible claimants, and collection and handling of income for the 
State unemployment fund (particularly taxes and reimbursements), with 
the greatest accuracy feasible.
    (b) The Secretary interprets sections 303(a)(1) and 303(a)(6), SSA, 
to authorize the Department of Labor to prescribe standard definitions, 
methods

[[Page 18]]

and procedures, and reporting requirements for the QC program and to 
ensure accuracy and verification of QC findings.
    (c) The Secretary interprets section 303(b)(2), SSA to require that, 
in the administration of a State law, there shall be substantial 
compliance with the provisions required by sections 303(a) (1) and (6). 
Further, conformity of the State law with those requirements is required 
by section 303(a) andSec. 601.5(a) of this chapter.
    (d) To satisfy the requirements of sections 303(a) (1) and (6), a 
State law must contain a provision requiring, or which is construed to 
require, the establishment and maintenance of a QC program in accordance 
with the requirements of this part. The establishment and maintenance of 
such a QC program in accordance with this part shall not require any 
change in State law concerning authority to undertake redeterminations 
of claims or liabilities or the finality of any determination, 
redetermination or decision.



                    Subpart C_State Responsibilities



Sec.  602.20  Organization.

    Each State shall establish a QC unit independent of, and not 
accountable to, any unit performing functions subject to evaluation by 
the QC unit. The organizational location of this unit shall be 
positioned to maximize its objectivity, to facilitate its access to 
information necessary to carry out its responsibilities, and to minimize 
organizational conflict of interest.



Sec.  602.21  Standard methods and procedures.

    Each State shall:
    (a) Perform the requirements of this section in accordance with 
instructions issued by the Department, pursuant toSec. 602.30(a) of 
this part, to ensure standardization of methods and procedures in a 
manner consistent with this part;
    (b) Select representative samples for QC study of at least a minimum 
size specified by the Department to ensure statistical validity (for 
benefit payments, a minimum of 400 cases of weeks paid per State per 
year);
    (c) Complete prompt and in-depth case investigations to determine 
the degree of accuracy and timeliness in the administration of the State 
UC law and Federal programs with respect to benefit determinations, 
benefit payments, and revenue collections; and conduct other 
measurements and studies necessary or appropriate for carrying out the 
purposes of this part; and in conducting investigations each State 
shall:
    (1) Inform claimants in writing that the information obtained from a 
QC investigation may affect their eligibility for benefits and inform 
employers in writing that the information obtained from a QC 
investigation of revenue may affect their tax liability,
    (2) Use a questionnaire, prescribed by the Department, which is 
designed to obtain such data as the Department deems necessary for the 
operation of the QC program; require completion of the questionnaire by 
claimants in accordance with the eligibility and reporting authority 
under State law,
    (3) Collect data identified by the Department as necessary for the 
operation of the QC program; however, the collection of demographic data 
will be limited to those data which relate to an individual's 
eligibility for UC benefits and necessary to conduct proportions tests 
to validate the selection of representative samples (the demographic 
data elements necessary to conduct proportions tests are claimants' date 
of birth, sex, and ethnic classification); and
    (4) Conclude all findings of inaccuracy as detected through QC 
investigations with appropriate official actions, in accordance with the 
applicable State and Federal laws; make any determinations with respect 
to individual benefit claims in accordance with the Secretary's 
``Standard for Claim Determinations--Separation Information'' in the 
Employment Security Manual, part V, sections 6010-6015 (appendix A of 
this part);
    (d) Classify benefit case findings resulting from QC investigations 
as:
    (1) Proper payments, underpayments, or overpayments in benefit 
payment cases, or
    (2) Proper denials or underpayments in benefit denial cases;
    (e) Make and maintain records pertaining to the QC program, and make

[[Page 19]]

all such records available in a timely manner for inspection, 
examination, and audit by such Federal officials as the Secretary may 
designate or as may be required or authorized by law;
    (f) Furnish information and reports to the Department, including 
weekly transmissions of case data entered into the automated QC system 
and annual reports, without, in any manner, identifying individuals to 
whom such data pertain; and
    (g) Release the results of the QC program at the same time each 
year, providing calendar year results using a standardized format to 
present the data as prescribed by the Department; States will have the 
opportunity to release this information prior to any release by the 
Department.

(Approved by the Office of Management and Budget under Control Number 
1205-0245)



Sec.  602.22  Exceptions.

    If the Department determines that the QC program, or any constituent 
part of the QC program, is not necessary for the proper and efficient 
administration of a State law or in the Department's view is not cost 
effective, the Department shall use established procedures to advise the 
State that it is partially or totally excepted from the specified 
requirements of this part. Any determination under this section shall be 
made only after consultations with the State agency.



                   Subpart D_Federal Responsibilities



Sec.  602.30  Management.

    (a) The Department shall establish required methods and procedures 
(as specified inSec. 602.21 of this part); and provide technical 
assistance as needed on the QC process.
    (b) The Department shall consider and explore alternatives to the 
prescribed sampling, study, recordkeeping, and reporting methodologies. 
This shall include, but not be limited to, testing the obtaining of 
information needed for QC by telephone and mail rather than in face-to-
face interviews.
    (c) The Department shall maintain a computerized data base of QC 
case data which is transmitted to the Department underSec. 602.21, 
which will be combined with other data for statistical and other 
analysis such as assessing the impact of economic cycles, funding 
levels, and workload levels on program accuracy and timeliness.



Sec.  602.31  Oversight.

    The Department shall review QC operational procedures and samples, 
and validate QC methodology to ensure uniformity in the administration 
of the QC program and to ensure compliance with the requirements of this 
part. The Department shall, for purposes of determining eligibility for 
grants described inSec. 602.40, annually review the adequacy of the 
administration of a State's QC program.



               Subpart E_Quality Control Grants to States



Sec.  602.40  Funding.

    (a) The Department shall use established procedures to notify States 
of the availability of funds for the operation of QC programs in 
accordance with this part.
    (b) The Department may allocate additional resources, if available, 
to States for analysis of data generated by the QC program, to increase 
the number of claims sampled in areas where more information is needed, 
for pilot studies for the purpose of expanding the QC program, and for 
corrective action.

[52 FR 33528, Sept. 3, 1987, as amended at 71 FR 35513, June 21, 2006]



Sec.  602.41  Proper expenditure of Quality Control granted funds.

    The Secretary may, after reasonable notice and opportunity for 
hearing to the State agency, take exception to and require repayment of 
an expenditure for the operation of a QC program if it is found by the 
Secretary that such expenditure is not necessary for the proper and 
efficient administration of the QC program in the State. See sections 
303(a)(8), 303(a)(9) and 303(b)(2), SSA, and 20 CFR 601.5. For purposes 
of this section, an expenditure will be

[[Page 20]]

found not necessary for proper and efficient administration if such 
expenditure fails to comply with the requirements of subpart C of this 
part.

[52 FR 33528, Sept. 3, 1987, as amended at 52 FR 34343, Sept. 10, 1987]



Sec.  602.42  Effect of failure to implement Quality Control program.

    Any State which the Secretary finds, after reasonable notice and 
opportunity for hearing, has not implemented or maintained a QC program 
in accordance with this part will not be eligible for any grants under 
title III of the Social Security Act until such time as the Secretary is 
satisfied that there is no longer any failure to conform or to comply 
substantially with any provision specified in this part. See sections 
303(a)(1), 303(a)(6), and 303(b)(2), SSA, and 20 CFR 601.5.



Sec.  602.43  No incentives or sanctions based on specific error rates.

    Neither sanctions nor funding incentives shall be used by the 
Department to influence the achievement of specified error rates in 
State UC programs.



    Sec. Appendix A to Part 602--Standard for Claim Determinations--
                         Separation Information

         Employment Security Manual (Part V, Sections 6010-6015)

    6010 Federal Law Requirements. Section 303(a)(1) of the Social 
Security Act requires that a State law include provision for:
    ``Such methods of administration . . . as are found by the Secretary 
to be reasonably calculated to insure full payment of unemployment 
compensation when due.''
    Section 303(a)(3) of the Social Security Act requires that a State 
law include provision for:
    ``Opportunity for a fair hearing before an impartial tribunal, for 
all individuals whose claims for unemployment compensation are denied.''
    Section 3304(a)(4) of the Federal Unemployment Tax Act and section 
303(a)(5) of the Social Security Act require that a State law include 
provision for:
    ``Expenditure of all money withdrawn from an unemployment fund of 
such State, in the payment of unemployment compensation. . . .''
    Section 3306(h) of the Federal Unemployment Tax Act defines 
``compensation'' as ``cash benefits payable to individuals with respect 
to their unemployment.''
    6011 Secretary's Interpretation of Federal Law Requirements. The 
Secretary interprets the above sections to require that a State law 
include provisions which will insure that:
    A. Individuals who may be entitled to unemployment compensation are 
furnished such information as will reasonably afford them an opportunity 
to know, establish, and protect their rights under the unemployment 
compensation law of such State, and
    B. The State agency obtains and records in time for the prompt 
determination and review of benefit claims such information as will 
reasonably insure the payment of benefits to individuals to whom 
benefits are due.
    6012 Criteria for Review of State Law Conformity with Federal 
Requirements:
    In determining the conformity of a State law with the above 
requirements of the Federal Unemployment Tax Act and the Social Security 
Act as interpreted by the Secretary, the following criteria will be 
applied:
    A. Is it required that individuals who may be entitled to 
unemployment compensation be furnished such information of their 
potential rights to benefits, including the manner and places of filing 
claims, the reasons for determinations, and their rights of appeal, as 
will insure them a reasonable opportunity to know, establish, and 
protect their rights under the law of the State?
    B. Is the State agency required to obtain, in time for prompt 
determination of rights to benefits such information as will reasonably 
insure the payment of benefits to individuals to whom benefits are due?
    C. Is the State agency required to keep records of the facts 
considered in reaching determinations of rights to benefits?
    6013 Claim Determinations Requirements Designed To Meet Department 
of Labor Criteria:
    A. Investigation of claims. The State agency is required to obtain 
promptly and prior to a determination of an individual's right to 
benefits, such facts pertaining thereto as will be sufficient reasonably 
to insure the payment of benefits when due.
    This requirement embraces five separate elements:
    1. It is the responsibility of the agency to take the initiative in 
the discovery of information. This responsibility may not be passed on 
to the claimant or the employer. In addition to the agency's own 
records, this information may be obtained from the worker, the employer, 
or other sources. If the information obtained in the first instance 
discloses no essential disagreement and provides a sufficient basis for 
a fair determination, no further investigation is necessary. If the 
information obtained from other sources differs essentially from that 
furnished by the claimant, the agency, in order to meet its 
responsibility, is required to inform the claimant of such information 
from other sources

[[Page 21]]

and to afford the claimant an opportunity to furnish any further facts 
he may have.
    2. Evidentiary facts must be obtained as distinguished from ultimate 
facts or conclusions. That a worker was discharged for misconduct is an 
ultimate fact or conclusion; that he destroyed a machine upon which he 
was working is a primary or evidentiary fact, and the sort of fact that 
the requirement refers to.
    3. The information obtained must be sufficient reasonably to insure 
the payment of benefits when due. In general, the investigation made by 
the agency must be complete enough to provide information upon which the 
agency may act with reasonable assurance that its decision is consistent 
with the unemployment compensation law. On the other hand, the 
investigation should not be so exhaustive and time-consuming as unduly 
to delay the payment of benefits and to result in excessive costs.
    4. Information must be obtained promptly so that the payment of 
benefits is not unduly delayed.
    5. If the State agency requires any particular evidence from the 
worker, it must give him a reasonable opportunity to obtain such 
evidence.
    B. Recording of facts. The agency must keep a written record of the 
facts considered in reaching its determinations.
    C. Determination notices.
    1. The agency must give each claimant a written notice of:
    a. Any monetary determination with respect to his benefit year;
    b. Any determination with respect to purging a disqualification if, 
under the State law, a condition or qualification must be satisfied with 
respect to each week of disqualification; but in lieu of giving written 
notice of each determination for each week in which it is determined 
that the claimant has met the requirements for purging, the agency may 
inform the claimant that he has purged the disqualification for a week 
by notation of his applicant identification card or otherwise in 
writing.
    c. Any other determination which adversely affects \1\ his rights to 
benefits, except that written notice of determination need not be given 
with respect to:
---------------------------------------------------------------------------

    \1\ A determination ``adversely affects'' claimant's right to 
benefits if it (1) results in a denial to him of benefits (including a 
cancellation of benefits or wage credits or any reduction in whole or in 
part below the weekly or maximum amount established by his monetary 
determination) for any week or other period; or (2) denies credit for a 
waiting week; or (3) applies any disqualification or penalty; or (4) 
determines that he has not satisfied a condition of eligibility, 
requalification for benefits, or purging a disqualification; or (5) 
determines that an overpayment has been made or orders repayment or 
recoupment of any sum paid to him; or (6) applies a previously 
determined overpayment, penalty, or order for repayment or recoupment; 
or (7) in any other way denies claimant a right to benefits under the 
State law.
---------------------------------------------------------------------------

    (1) A week in a benefit year for which the claimant's weekly benefit 
amount is reduced in whole or in part by earnings if, the first time in 
the benefit year that there is such a reduction, he is required to be 
furnished a booklet or leaflet containing the information set forth 
below in paragraph 2f(1). However, a written notice of determination is 
required if: (a) there is a dispute concerning the reduction with 
respect to any week (e.g., as to the amount computed as the appropriate 
reduction, etc.); or (b) there is a change in the State law (or in the 
application thereof) affecting the reduction; or
    (2) Any week in a benefit year subsequent to the first week in such 
benefit year in which benefits were denied, or reduced in whole or in 
part for reasons other than earnings, if denial or reduction for such 
subsequent week is based on the same reason and the same facts as for 
the first week, and if written notice of determination is required to be 
given to the claimant with respect to such first week, and with such 
notice of determination, he is required to be given a booklet or 
pamphlet containing the information set forth below in paragraphs 2f(2) 
and 2h. However, a written notice of determination is required if: (a) 
there is a dispute concerning the denial or reduction of benefits with 
respect to such week; or (b) there is a change in the State law (or in 
the application thereof) affecting the denial or reduction; or (c) there 
is a change in the amount of the reduction except as to the balance 
covered by the last reduction in a series of reductions.
    Note: This procedure may be applied to determinations made with 
respect to any subsequent weeks for the same reason and on the basis of 
the same facts: (a) that claimant is unable to work, unavailable for 
work, or is disqualified under the labor dispute provision; and (b) 
reducing claimant's weekly benefit amount because of income other than 
earnings or offset by reason of overpayment.
    2. The agency must include in written notices of determinations 
furnished to claimants sufficient information to enable them to 
understand the determinations, the reasons therefor, and their rights to 
protest, request reconsideration, or appeal.
    The written notice of monetary determination must contain the 
information specified in the following items (except h) unless an item 
is specifically not applicable. A written

[[Page 22]]

notice of any other determination must contain the information specified 
in as many of the following items as are necessary to enable the 
claimant to understand the determination and to inform him of his appeal 
rights. Information specifically applicable to the individual claimant 
must be contained in the written notice of determination. Information of 
general application such as (but not limited to) the explanation of 
benefits for partial unemployment, information as to deductions, 
seasonality factors, and information as to the manner and place of 
taking an appeal, extension of the appeal period, and where to obtain 
information and assistance may be contained in a booklet or leaflet 
which is given the claimant with his monetary determination.
    a. Base period wages. The statement concerning base-period wages 
must be in sufficient detail to show the basis of computation of 
eligibility and weekly and maximum benefit amounts. (If maximum benefits 
are allowed, it may not be necessary to show details of earnings.)
    b. Employer name. The name of the employer who reported the wages is 
necessary so that the worker may check the wage transcript and know 
whether it is correct. If the worker is given only the employer number, 
he may not be able to check the accuracy of the wage transcript.
    c. Explanation of benefit formula--weekly and maximum benefit 
amounts. Sufficient information must be given the worker so that he will 
understand how his weekly benefit amount, including allowances for 
dependents, and his maximum benefit amount were figured. If benefits are 
computed by means of a table contained in the law, the table must be 
furnished with the notice of determination whether benefits are granted 
or denied.
    The written notice of determination must show clearly the weekly 
benefit amount and the maximum potential benefits to which the claimant 
is entitled.
    The notice to a claimant found ineligible by reason of insufficient 
earnings in the base period must inform him clearly of the reason for 
ineligibility. An explanation of the benefit formula contained in a 
booklet or pamphlet should be given to each claimant at or prior to the 
time he receives written notice of a monetary determination.
    d. Benefit year. An explanation of what is meant by the benefit year 
and identification of the claimant's benefit year must be included in 
the notice of determination.
    e. Information as to benefits for partial unemployment. There must 
be included either in the written notice of determination or in a 
booklet or pamphlet accompanying the notice an explanation of the 
claimant's rights to partial benefits for any week with respect to which 
he is working less than his normal customary full-time workweek because 
of lack of work and for which he earns less than his weekly benefit 
amount or weekly benefit amount plus earnings, whichever is provided by 
the State law. If the explanation is contained in the notice of 
determination, reference to the item in the notice in which his weekly 
benefit amount is entered should be made.
    f. Deductions from weekly benefits.
    (1) Earnings. Although written notice of determinations deducting 
earnings from a claimant's weekly benefit amount is generally not 
required (see paragraph 1 c (1) above), where written notice of 
determination is required (or given) it shall set forth the amount of 
earnings, the method of computing the deduction in sufficient detail to 
enable the claimant to verify the accuracy of the deduction, and his 
right to protest, request redetermination, and appeal. Where a written 
notice of determination is given to the claimant because there has been 
a change in the State law or in the application of the law, an 
explanation of the change shall be included.
    Where claimant is not required to receive a written notice of 
determination, he must be given a booklet or pamphlet the first time in 
his benefit year that there is a deduction for earnings which shall 
include the following information:
    (a) The method of computing deductions for earnings in sufficient 
detail to enable the claimant to verify the accuracy of the deduction;
    (b) That he will not automatically be given a written notice of 
determination for a week with respect to which there is a deduction for 
earnings (unless there is a dispute concerning the reduction with 
respect to a week or there has been a change in the State law or in the 
application of the law affecting the deduction) but that he may obtain 
such a written notice upon request; and
    (c) A clear statement of his right to protest, request a 
redetermination, and appeal from any determination deducting earnings 
from his weekly benefit amount even though he does not automatically 
receive a written notice of determination; and if the State law requires 
written notice of determination in order to effectuate a protest, 
redetermination, or appeal, he must be so advised and advised also that 
he must request a written notice of determination before he takes any 
such action.
    (2) Other deductions.
    (a) A written notice of determination is required with respect to 
the first week in claimant's benefit year in which there is a reduction 
from his benefits for a reason other than earnings. This notice must 
describe the deduction made from claimant's weekly benefit amount, the 
reason for the deduction, the method of computing it in sufficient 
detail to enable him to verify the accuracy of such deduction, and his 
right to protest, request redetermination, or appeal.

[[Page 23]]

    (b) A written notice of determination is not required for subsequent 
weeks that a deduction is made for the same reason and on the basis of 
the same facts, if the notice of determination pursuant to (2)(a), or a 
booklet or pamphlet given him with such notice explains (i) the several 
kinds of deductions which may be made under the State law (e.g., 
retirement pensions, vacation pay, and overpayments); (ii) the method of 
computing each kind of deduction in sufficient detail that claimant will 
be able to verify the accuracy of deductions made from his weekly 
benefit payments; (iii) any limitation on the amount of any deduction or 
the time in which any deduction may be made; (iv) that he will not 
automatically be given a written notice of determination for subsequent 
weeks with respect to which there is a deduction for the same reason and 
on the basis of the same facts, but that he may obtain a written notice 
of determination upon request; (v) his right to protest, request 
redetermination, or appeal with respect to subsequent weeks for which 
there is a reduction from his benefits for the same reason, and on the 
basis of the same facts even though he does not automatically receive a 
written notice of determination; and (vi) that if the State law requires 
written notice of determination in order to effectuate a protest, 
redetermination, or appeal, he must be so advised and advised also that 
he must request a written notice of determination before he takes any 
such action.
    g. Seasonality factors. If the individual's determination is 
affected by seasonality factors under the State law, an adequate 
explanation must be made. General explanation of seasonality factors 
which may affect determinations for subsequent weeks may be included in 
a booklet or pamphlet given claimant with his notice of monetary 
determination.
    h. Disqualification or ineligibility. If a disqualification is 
imposed, or if the claimant is declared ineligible for one or more 
weeks, he must be given not only a statement of the period of 
disqualification or ineligibility and the amount of wage-credit 
reductions, if any, but also an explanation of the reason for the 
ineligibility or disqualification. This explanation must be sufficiently 
detailed so that he will understand why he is ineligible or why he has 
been disqualified, and what he must do in order to requalify for 
benefits or purge the disqualification. The statement must be 
individualized to indicate the facts upon which the determination was 
based, e.g., state, ``It is found that you left your work with Blank 
Company because you were tired of working; the separation was voluntary, 
and the reason does not constitute good cause,'' rather than merely the 
phrase ``voluntary quit.'' Checking a box as to the reason for the 
disqualification is not a sufficiently detailed explanation. However, 
this statement of the reason for the disqualification need not be a 
restatement of all facts considered in arriving at the determination.
    i. Appeal rights. The claimant must be given information with 
respect to his appeal rights.
    (1) The following information shall be included in the notice of 
determination:
    (a) A statement that he may appeal or, if the State law requires or 
permits a protest or redetermination before an appeal, that he may 
protest or request a redetermination.
    (b) The period within which an appeal, protest, or request for 
redetermination must be filed. The number of days provided by statute 
must be shown as well as either the beginning date or ending date of the 
period. (It is recommended that the ending date of the appeal period be 
shown, as this is the more understandable of the alternatives.)
    (2) The following information must be included either in the notice 
of determination or in separate informational material referred to in 
the notice:
    (a) The manner in which the appeal, protest, or request for 
redetermination must be filed, e.g., by signed letter, written 
statement, or on a prescribed form, and the place or places to which the 
appeal, protest, or request for redetermination may be mailed or hand-
delivered.
    (b) An explanation of any circumstances (such as nonworkdays, good 
cause, etc.) which will extend the period for the appeal, protest, or 
request for redetermination beyond the date stated or identified in the 
notice of determination.
    (c) That any further information claimant may need or desire can be 
obtained together with assistance in filing his appeal, protest, or 
request for redetermination from the local office.
    If the information is given in separate material, the notice of 
determination would adequately refer to such material if it said, for 
example, ``For other information about your (appeal), (protest), 
(redetermination) rights, see pages ---- to ---- of the -------- (name 
of pamphlet or booklet) heretofore furnished to you.''
    6014 Separation Information Requirements Designed To Meet Department 
of Labor Criteria:
    A. Information to agency. Where workers are separated, employers are 
required to furnish the agency promptly, either upon agency request or 
upon such separation, a notice describing the reasons for and the 
circumstances of the separation and any additional information which 
might affect a claimant's right to benefits. Where workers are working 
less than full time, employers are required to furnish the agency 
promptly, upon agency request, information concerning a claimant's hours 
of work and his wages during the claim periods involved, and other facts 
which might affect a claimant's eligibility for benefits during such 
periods.

[[Page 24]]

    When workers are separated and the notices are obtained on a request 
basis, or when workers are working less than full time and the agency 
requests information, it is essential to the prompt processing of claims 
that the request be sent out promptly after the claim is filed and the 
employer be given a specific period within which to return the notice, 
preferably within 2 working days.
    When workers are separated and notices are obtained upon separation, 
it is essential that the employer be required to send the notice to the 
agency with sufficient promptness to insure that, if a claim is filed, 
it may be processed promptly. Normally, it is desirable that such a 
notice be sent to the central office of the agency, since the employer 
may not know in which local office the workers will file his claim. The 
usual procedure is for the employer to give the worker a copy of the 
notice sent by the employer to the agency.
    B. Information to worker.
    1. Information required to be given. Employers are required to give 
their employees information and instructions concerning the employees' 
potential rights to benefits and concerning registration for work and 
filing claims for benefits.
    The information furnished to employees under such a requirement need 
not be elaborate; it need only be adequate to insure that the worker who 
is separated or who is working less than full time knows he is 
potentially eligible for benefits and is informed as to what he is to do 
or where he is to go to file his claim and register for work. When he 
files his claim, he can obtain more detailed information.
    In States that do not require employers to furnish periodically to 
the State agency detailed reports of the wages paid to their employees, 
each employer is required to furnish to his employees information as to 
(a) the name under which he is registered by the State agency, (b) the 
address where he maintains his payroll records, and (c) the workers' 
need for this information if and when they file claims for benefits.
    2. Methods for giving information. The information and instructions 
required above may be given in any of the following ways:
    a. Posters prominently displayed in the employer's establishment. 
The State agency should supply employers with a sufficient number of 
posters for distribution throughout their places of business and should 
see that the posters are conspicuously displayed at all times.
    b. Leaflets. Leaflets distributed either periodically or at the time 
of separation or reduction of hours. The State agency should supply 
employers with a sufficient number of leaflets.
    c. Individual notices. Individual notices given to each employee at 
the time of separation or reduction in hours.
    It is recommended that the State agency's publicity program be used 
to supplement the employer-information requirements. Such a program 
should stress the availability and location of claim-filing offices and 
the importance of visiting those offices whenever the worker is 
unemployed, wishes to apply for benefits, and to seek a job.
    6015 Evaluation of Alternative State Provisions with Respect to 
Claim Determinations and Separation Information. If the State law 
provisions do not conform to the suggested requirements set forth in 
sections 6013 and 6014, but the State law contains alternative 
provisions, the Bureau of Employment Security, in collaboration with the 
State agency, will study the actual or anticipated effects of the 
alternative provisions. If the Administrator of the Bureau concludes 
that the alternative provisions satisfy the criteria in section 6012, he 
will so notify the State agency. If the Administrator of the Bureau does 
not so conclude, he will submit the matter to the Secretary. If the 
Secretary concludes that the alternative provisions satisfy the criteria 
in section 6012, the State agency will be so notified. If the Secretary 
concludes that there is a question as to whether the alternative 
provisions satisfy the criteria, the State agency will be advised that 
unless the State law provisions are appropriately revised, a notice of 
hearing will be issued as required by the Code of Federal Regulations, 
title 20, section 601.5.



PART 603_FEDERAL-STATE UNEMPLOYMENT COMPENSATION (UC) PROGRAM; 
CONFIDENTIALITY AND DISCLOSURE OF STATE UC INFORMATION--
Table of Contents



                          Subpart A_In General

Sec.
603.1 What are the purpose and scope of this part?
603.2 What definitions apply to this part?

          Subpart B_Confidentiality and Disclosure Requirements

603.3 What is the purpose and scope of this subpart?
603.4 What is the confidentiality requirement of Federal UC law?
603.5 What are the exceptions to the confidentiality requirement?
603.6 What disclosures are required by this subpart?
603.7 What requirements apply to subpoenas, other compulsory processes, 
          and

[[Page 25]]

          disclosure to officials with subpoena authority?
603.8 What are the requirements for payment of costs and program income?
603.9 What safeguards and security requirements apply to disclosed 
          information?
603.10 What are the requirements for agreements?
603.11 How do States notify claimants and employers about the uses of 
          their information?
603.12 How are the requirements of this part enforced?

 Subpart C_Mandatory Disclosure for Income and Eligibility Verification 
                              System (IEVS)

603.20 What is the purpose and scope of this subpart?
603.21 What is a requesting agency?
603.22 What information must State UC agencies disclose for purposes of 
          an IEVS?
603.23 What information must State UC agencies obtain from other 
          agencies, and crossmatch with wage information, for purposes 
          of an IEVS?

    Authority: 42 U.S.C. 1302(a); Secretary's Order No. 4-75 (40 FR 
18515) and Secretary's Order No. 14-75 (November 12, 1975).

    Source: 71 FR 56842, Sept. 27, 2006, unless otherwise noted.



                          Subpart A_In General



Sec.  603.1  What are the purpose and scope of this part?

    The purpose of this part is to implement the requirements of Federal 
UC law concerning confidentiality and disclosure of UC information. This 
part applies to States and State UC agencies, as defined inSec. 
603.2(f) and (g).



Sec.  603.2  What definitions apply to this part?

    For the purposes of this part:
    (a)(1) Claim information means information about:
    (i) Whether an individual is receiving, has received, or has applied 
for UC;
    (ii) The amount of compensation the individual is receiving or is 
entitled to receive; and
    (iii) The individual's current (or most recent) home address.
    (2) For purposes of subpart C (IEVS), claim information also 
includes:
    (i) Whether the individual has refused an offer of work and, if so, 
a description of the job offered including the terms, conditions, and 
rate of pay; and
    (ii) Any other information contained in the records of the State UC 
agency that is needed by the requesting agency to verify eligibility 
for, and the amount of, benefits.
    (b) Confidential UC information and confidential information mean 
any UC information, as defined in paragraph (j) of this section, 
required to be kept confidential underSec. 603.4.
    (c) Public domain information means--
    (1) Information about the organization of the State and the State UC 
agency and appellate authorities, including the names and positions of 
officials and employees thereof;
    (2) Information about the State UC law (and applicable Federal law) 
provisions, rules, regulations, and interpretations thereof, including 
statements of general policy and interpretations of general 
applicability; and
    (3) Any agreement of whatever kind or nature, including interstate 
arrangements and reciprocal agreements and any agreement with the 
Department of Labor or the Secretary, relating to the administration of 
the State UC law.
    (d) Public official means an official, agency, or public entity 
within the executive branch of Federal, State, or local government who 
(or which) has responsibility for administering or enforcing a law, or 
an elected official in the Federal, State, or local government.
    (e) Secretary and Secretary of Labor mean the cabinet officer 
heading the United States Department of Labor, or his or her designee.
    (f) State means a State of the United States of America, the 
District of Columbia, the Commonwealth of Puerto Rico, and the United 
States Virgin Islands.
    (g) State UC agency means an agency charged with the administration 
of the State UC law.
    (h) State UC law means the law of a State approved under Section 
3304(a) of the Internal Revenue Code of 1986 (26 U.S.C. 3304(a)).
    (i) Unemployment compensation (UC) means cash benefits payable to 
individuals with respect to their unemployment.

[[Page 26]]

    (j) UC information and State UC information means information in the 
records of a State or State UC agency that pertains to the 
administration of the State UC law. This term includes those State wage 
reports collected under the IEVS (Section 1137 of the Social Security 
Act (SSA)) that are obtained by the State UC agency for determining UC 
monetary eligibility or are downloaded to the State UC agency's files as 
a result of a crossmatch but does not otherwise include those wage 
reports. It does not include information in a State's Directory of New 
Hires, but does include any such information that has been disclosed to 
the State UC agency for use in the UC program. It also does not include 
the personnel or fiscal information of a State UC agency.
    (k) Wage information means information in the records of a State UC 
agency (and, for purposes ofSec. 603.23 (IEVS)), information reported 
under provisions of State law which fulfill the requirements of Section 
1137, SSA) about the--
    (1) Wages paid to an individual,
    (2) Social security account number (or numbers, if more than one) of 
such individual, and
    (3) Name, address, State, and the Federal employer identification 
number of the employer who paid such wages to such individual.



          Subpart B_Confidentiality and Disclosure Requirements



Sec.  603.3  What is the purpose and scope of this subpart?

    This subpart implements the basic confidentiality requirement 
derived from Section 303(a)(1), SSA, and the disclosure requirements of 
Sections 303(a)(7), (c)(1), (d), (e), (h), and (i), SSA, and Section 
3304(a)(16), Federal Unemployment Tax Act (FUTA). This subpart also 
establishes uniform minimum requirements for the payment of costs, 
safeguards, and data-sharing agreements when UC information is 
disclosed, and for conformity and substantial compliance with this 
proposed rule. This subpart applies to States and State UC agencies, as 
defined inSec. 603.2(f) and (g), respectively.



Sec.  603.4  What is the confidentiality requirement of Federal
UC law?

    (a) Statute. Section 303(a)(1) of the SSA (42 U.S.C. 503(a)(1)) 
provides that, for the purposes of certification of payment of granted 
funds to a State under Section 302(a) (42 U.S.C. 502(a)), State law must 
include provision for such methods of administration as are found by the 
Secretary of Labor to be reasonably calculated to insure full payment of 
unemployment compensation when due.
    (b) Interpretation. The Department of Labor interprets Section 
303(a)(1), SSA, to mean that ``methods of administration'' that are 
reasonably calculated to insure the full payment of UC when due must 
include provision for maintaining the confidentiality of any UC 
information which reveals the name or any identifying particular about 
any individual or any past or present employer or employing unit, or 
which could foreseeably be combined with other publicly available 
information to reveal any such particulars, and must include provision 
for barring the disclosure of any such information, except as provided 
in this part.
    (c) Application. Each State law must contain provisions that are 
interpreted and applied consistently with the interpretation in 
paragraph (b) of this section and with this subpart, and must provide 
penalties for any disclosure of confidential UC information that is 
inconsistent with any provision of this subpart.



Sec.  603.5  What are the exceptions to the confidentiality 
requirement?

    The following are exceptions to the confidentiality requirement. 
Disclosure of confidential UC information is permissible under the 
exceptions in paragraphs (a) through (g) of this section only if 
authorized by State law and if such disclosure does not interfere with 
the efficient administration of the State UC law. Disclosure of 
confidential UC information is permissible under the exceptions in 
paragraphs (h) and (i) of this section without such restrictions.
    (a) Public domain information. The confidentiality requirement of 
Sec.  603.4 does not apply to public domain information, as defined at 
Sec.  603.2(c).

[[Page 27]]

    (b) UC appeals records. Disclosure of appeals records and decisions, 
and precedential determinations on coverage of employers, employment, 
and wages, is permissible provided all social security account numbers 
have been removed and such disclosure is otherwise consistent with 
Federal and State law.
    (c) Individual or employer. Disclosure for non-UC purposes, of 
confidential UC information about an individual to that individual, or 
of confidential UC information about an employer to that employer, is 
permissible.
    (d) Informed consent. Disclosure of confidential UC information on 
the basis of informed consent is permissible in the following 
circumstances--
    (1) Agent--to one who acts for or in the place of an individual or 
an employer by the authority of that individual or employer if--
    (i) In general--
    (A) The agent presents a written release (which may include an 
electronically submitted release that the State determines is authentic) 
from the individual or employer being represented;
    (B) When a written release is impossible or impracticable to obtain, 
the agent presents such other form of consent as is permitted by the 
State UC agency in accordance with State law;
    (ii) In the case of an elected official performing constituent 
services, the official presents reasonable evidence (such as a letter 
from the individual or employer requesting assistance or a written 
record of a telephone request from the individual or employer) that the 
individual or employer has authorized such disclosure; or
    (iii) In the case of an attorney retained for purposes related to 
the State's UC law, the attorney asserts that he or she is representing 
the individual or employer.
    (2) Third party (other than an agent) or disclosure made on an 
ongoing basis--to a third party that is not acting as an agent or that 
receives confidential information following an informed consent 
disclosure on an ongoing basis (even if such entity is an agent), but 
only if that entity obtains a written release from the individual or 
employer to whom the information pertains.
    (i) The release must be signed and must include a statement--
    (A) Specifically identifying the information that is to be 
disclosed;
    (B) That State government files will be accessed to obtain that 
information;
    (C) Of the specific purpose or purposes for which the information is 
sought and a statement that information obtained under the release will 
only be used for that purpose or purposes; and
    (D) Indicating all the parties who may receive the information 
disclosed.
    (ii) The purpose specified in the release must be limited to--
    (A) Providing a service or benefit to the individual signing the 
release that such individual expects to receive as a result of signing 
the release; or
    (B) Carrying out administration or evaluation of a public program to 
which the release pertains.

    Note to paragraph (d): The Electronic Signatures in Global and 
National Commerce Act of 2000 (E-Sign), Pub. L. 106-229, may apply where 
a party wishes to effectuate electronically an informed consent release 
(Sec.  603.5(d)(2)) or a disclosure agreement (Sec.  603.10(a)) with an 
entity that uses informed consent releases. E-Sign, among other things, 
sets forth the circumstances under which electronic signatures, 
contracts, and other records relating to such transactions (in lieu of 
paper documents) are legally binding. Thus, an electronic communication 
may suffice under E-Sign to establish a legally binding contract. The 
States will need to consider E-Sign's application to these informed 
consent releases and disclosure agreements. In particular, a State must, 
to conform and substantially comply with this regulation, assure that 
these informed consent releases and disclosure agreements are legally 
enforceable. If an informed consent release or disclosure agreement is 
to be effectuated electronically, the State must determine whether E-
Sign applies to that transaction, and, if so, make certain that the 
transaction satisfies the conditions imposed by E-Sign. The State must 
also make certain that the electronic transaction complies with every 
other condition necessary to make it legally enforceable.

    (e) Public official. Disclosure of confidential UC information to a 
public official for use in the performance of his or her official duties 
is permissible. ``Performance of official duties'' means administration 
or enforcement of law or the execution of the official responsibilities 
of a Federal, State, or local elected official. Administration of law

[[Page 28]]

includes research related to the law administered by the public 
official. Execution of official responsibilities does not include 
solicitation of contributions or expenditures to or on behalf of a 
candidate for public or political office or a political party.
    (f) Agent or contractor of public official. Disclosure of 
confidential UC information to an agent or contractor of a public 
official to whom disclosure is permissible under paragraph (e) of this 
section.
    (g) Bureau of Labor Statistics. The confidentiality requirement does 
not apply to information collected exclusively for statistical purposes 
under a cooperative agreement with the Bureau of Labor Statistics (BLS). 
Further, this part does not restrict or impose any condition on the 
transfer of any other information to the BLS under an agreement, or the 
BLS's disclosure or use of such information.
    (h) Court order; official with subpoena authority. Disclosure of 
confidential UC information in response to a court order or to an 
official with subpoena authority is permissible as specified inSec. 
603.7(b).
    (i) UC Program Oversight and Audits. The confidentiality requirement 
does not apply to any disclosure to a Federal official for purposes of 
UC program oversight and audits, including disclosures under 20 CFR part 
601 and 29 CFR parts 96 and 97.



Sec.  603.6  What disclosures are required by this subpart?

    (a) The confidentiality requirement of 303(a)(1), SSA, andSec. 
603.4 are not applicable to this paragraph (a) and the Department of 
Labor interprets Section 303(a)(1), SSA, as requiring disclosure of all 
information necessary for the proper administration of the UC program. 
This includes disclosures to claimants, employers, the Internal Revenue 
Service (for purposes of UC tax administration), and the U.S. 
Citizenship and Immigration Services (for purposes of verifying a 
claimant's immigration status).
    (b) In addition to Section 303(f), SSA (concerning an IEVS), which 
is addressed in subpart C, the following provisions of Federal UC law 
also specifically require disclosure of State UC information and State-
held information pertaining to the Federal UC and benefit programs of 
Unemployment Compensation for Federal Employees (UCFE), Unemployment 
Compensation for Ex-Servicemembers (UCX), Trade Adjustment Assistance 
(TAA) (except for confidential business information collected by 
States), Disaster Unemployment Assistance (DUA), and any Federal UC 
benefit extension program:
    (1) Section 303(a)(7), SSA, requires State law to provide for making 
available, upon request, to any agency of the United States charged with 
the administration of public works or assistance through public 
employment, disclosure of the following information with respect to each 
recipient of UC--
    (i) Name;
    (ii) Address;
    (iii) Ordinary occupation;
    (iv) Employment status; and
    (v) A statement of such recipient's rights to further compensation 
under the State law.
    (2) Section 303(c)(1), SSA, requires each State to make its UC 
records available to the Railroad Retirement Board, and to furnish such 
copies of its UC records to the Railroad Retirement Board as the Board 
deems necessary for its purposes.
    (3) Section 303(d)(1), SSA, requires each State UC agency, for 
purposes of determining an individual's eligibility benefits, or the 
amount of benefits, under a food stamp program established under the 
Food Stamp Act of 1977, to disclose, upon request, to officers and 
employees of the Department of Agriculture, and to officers or employees 
of any State food stamp agency, any of the following information 
contained in the records of the State UC agency--
    (i) Wage information,
    (ii) Whether an individual is receiving, has received, or has made 
application for, UC, and the amount of any such compensation being 
received, or to be received, by such individual,
    (iii) The current (or most recent) home address of such individual, 
and
    (iv) Whether an individual has refused an offer of employment and, 
if so, a description of the employment so offered and the terms, 
conditions, and rate of pay therefore.

[[Page 29]]

    (4) Section 303(e)(1), SSA, requires each State UC agency to 
disclose, upon request, directly to officers or employees of any State 
or local child support enforcement agency, any wage information 
contained in the records of the State UC agency for purposes of 
establishing and collecting child support obligations (not to include 
custodial parent support obligations) from, and locating, individuals 
owing such obligations.
    (5) Section 303(h), SSA, requires each State UC agency to disclose 
quarterly, to the Secretary of Health and Human Services (HHS), wage 
information and claim information as required under Section 453(i)(1) of 
the SSA (establishing the National Directory of New Hires), contained in 
the records of such agency, for purposes of Subsections (i)(1), (i)(3), 
and (j) of Section 453, SSA (establishing the National Directory of New 
Hires and its uses for purposes of child support enforcement, Temporary 
Assistance to Needy Families (TANF), TANF research, administration of 
the earned income tax credit, and use by the Social Security 
Administration).
    (6) Section 303(i), SSA, requires each State UC agency to disclose, 
upon request, to officers or employees of the Department of Housing and 
Urban Development (HUD) and to representatives of a public housing 
agency, for purposes of determining an individual's eligibility for 
benefits, or the amount of benefits, under a housing assistance program 
of HUD, any of the following information contained in the records of 
such State agency about any individual applying for or participating in 
any housing assistance program administered by HUD who has signed a 
consent form approved by the Secretary of HUD--
    (i) Wage information, and
    (ii) Whether the individual is receiving, has received, or has made 
application for, UC, and the amount of any such compensation being 
received (or to be received) by such individual.
    (7) Section 3304(a)(16), FUTA requires each State UC agency--
    (i) To disclose, upon request, to any State or political subdivision 
thereof administering a Temporary Assistance to Needy Families Agency 
(TANF) program funded under part A of Title IV of the SSA, wage 
information contained in the records of the State UC agency which is 
necessary (as determined by the Secretary of HHS in regulations) for 
purposes of determining an individual's eligibility for TANF assistance 
or the amount of TANF assistance; and
    (ii) To furnish to the Secretary of HHS, in accordance with that 
Secretary's regulations at 45 CFR 303.108, wage information (as defined 
at 45 CFR 303.108(a)(2)) and UC information (as defined at 45 CFR 
303.108(a)(3)) contained in the records of such agency for the purposes 
of the National Directory of New Hires established under Section 453(i) 
of the SSA.
    (c) Each State law must contain provisions that are interpreted and 
applied consistently with the requirements listed in this section.



Sec.  603.7  What requirements apply to subpoenas, other compulsory
processes, and disclosure to officials with subpoena authority?

    (a) In general. Except as provided in paragraph (b) of this section, 
when a subpoena or other compulsory process is served upon a State UC 
agency or the State, any official or employee thereof, or any recipient 
of confidential UC information, which requires the production of 
confidential UC information or appearance for testimony upon any matter 
concerning such information, the State or State UC agency or recipient 
must file and diligently pursue a motion to quash the subpoena or other 
compulsory process if other means of avoiding the disclosure of 
confidential UC information are not successful or if the court has not 
already ruled on the disclosure. Only if such motion is denied by the 
court or other forum may the requested confidential UC information be 
disclosed, and only upon such terms as the court or forum may order, 
such as that the recipient protect the disclosed information and pay the 
State's or State UC agency's costs of disclosure.
    (b) Exceptions. The requirement of paragraph (a) of this section to 
move to quash subpoenas shall not be applicable, so that disclosure is 
permissible, where--
    (1) Court Decision--a subpoena or other compulsory legal process has

[[Page 30]]

been served and a court has previously issued a binding precedential 
decision that requires disclosures of this type, or a well-established 
pattern of prior court decisions have required disclosures of this type, 
or
    (2) Official with subpoena authority--Confidential UC information 
has been subpoenaed, by a local, State or Federal governmental official, 
other than a clerk of court on behalf of a litigant, with authority to 
obtain such information by subpoena under State or Federal law. The 
State or State UC agency may choose to disclose such confidential UC 
information to these officials without the actual issuance of a 
subpoena.



Sec.  603.8  What are the requirements for payment of costs and 
program income?

    (a) In general. Except as provided in paragraph (b) of this section, 
grant funds must not be used to pay any of the costs of making any 
disclosure of UC information. Grant funds may not be used to pay any of 
the costs of making any disclosures underSec. 603.5(d)(2) (third party 
(other than an agent) or disclosure made on an ongoing basis),Sec. 
603.5(e) (optional disclosure to a public official),Sec. 603.5(f) 
(optional disclosure to an agent or contractor of a public official), 
andSec. 603.5(g) (optional disclosure to BLS),Sec. 603.6(b) 
(mandatory disclosures for non-UC purposes), orSec. 603.22 (mandatory 
disclosure for purposes of an IEVS).
    (b) Use of grant funds permitted. Grant funds paid to a State under 
Section 302(a), SSA, may be used to pay the costs of only those 
disclosures necessary for proper administration of the UC program. (This 
may include some disclosures underSec. 603.5(a) (concerning public 
domain information),Sec. 603.5(c) (to an individual or employer), and 
Sec.  603.5(d)(1) (to an agent).) In addition, grant funds may be used 
to pay costs of disclosures underSec. 603.5(i) (for UC Program 
Oversight and Audits) andSec. 603.6(a) (for the proper administration 
of the UC program). Grant funds may also be used to pay costs associated 
with disclosures underSec. 603.7(b)(1) (concerning court-ordered 
compliance with subpoenas) if a court has denied recovery of costs, or 
to pay costs associated with disclosures underSec. 603.7(b)(2) (to 
officials with subpoena authority) if the State UC agency has attempted 
but not been successful in obtaining reimbursement of costs. Finally, 
grant funds may be used to pay costs associated with any disclosure of 
UC information if not more than an incidental amount of staff time and 
no more than nominal processing costs are involved in making the 
disclosure.
    (c) Calculation of costs. The costs to a State or State UC agency of 
processing and handling a request for disclosure of information must be 
calculated in accordance with the cost principles and administrative 
requirements of 29 CFR part 97 and Office of Management and Budget 
Circular No. A-87 (Revised). For the purpose of calculating such costs, 
any initial start-up costs incurred by the State UC agency in 
preparation for making the requested disclosure(s), such as computer 
reprogramming necessary to respond to the request, and the costs of 
implementing safeguards and agreements required by Sec.Sec. 603.9 and 
603.10, must be charged to and paid by the recipient. (Start-up costs do 
not include the costs to the State UC agency of obtaining, compiling, or 
maintaining information for its own purposes.) Postage or other delivery 
costs incurred in making any disclosure are part of the costs of making 
the disclosure. Penalty mail, as defined in 39 U.S.C. 3201(1), must not 
be used to transmit information being disclosed, except information 
disclosed for purposes of administration of State UC law. As provided in 
Sections 453(e)(2) and 453(g) of the SSA, the Secretary of HHS has the 
authority to determine what constitutes a reasonable amount for the 
reimbursement for disclosures under Section 303(h), SSA, and Section 
3304(a)(16)(B), FUTA.
    (d) Payment of costs. The costs to a State or State UC agency of 
making a disclosure of UC information, calculated in accordance with 
paragraph (c) of this section, must be paid by the recipient of the 
information or another source paying on behalf of the recipient, either 
in advance or by way of reimbursement. If the recipient is not a public 
official, such costs, except for good reason must be paid in advance. 
For the purposes of this paragraph (d),

[[Page 31]]

payment in advance means full payment of all costs before or at the time 
the disclosed information is given in hand or sent to the recipient. The 
requirement of payment of costs in this paragraph is met when a State UC 
agency has in place a reciprocal cost agreement or arrangement with the 
recipient. As used in this section, reciprocal means that the relative 
benefits received by each are approximately equal. Payment or 
reimbursement of costs must include any initial start-up costs 
associated with making the disclosure.
    (e) Program income. Costs paid as required by this section, and any 
funds generated by the disclosure of UC information under this part, are 
program income and may be used only as permitted by 29 CFR 97.25(g) (on 
program income). Such income may not be used to benefit a State's 
general fund or other program.



Sec.  603.9  What safeguards and security requirements apply to 
disclosed information?

    (a) In general. For disclosures of confidential UC information under 
Sec.  603.5(d)(2) (to a third party (other than an agent) or disclosures 
made on an ongoing basis);Sec. 603.5(e) (to a public official), except 
as provided in paragraph (d) of this section;Sec. 603.5(f) (to an 
agent or contractor of a public official);Sec. 603.6(b)(1) through 
(4), (6), and (7)(i) (as required by Federal UC law); andSec. 603.22 
(to a requesting agency for purposes of an IEVS), a State or State UC 
agency must require the recipient to safeguard the information disclosed 
against unauthorized access or redisclosure, as provided in paragraphs 
(b) and (c) of this section, and must subject the recipient to penalties 
provided by the State law for unauthorized disclosure of confidential UC 
information.
    (b) Safeguards to be required of recipients. (1) The State or State 
UC agency must:
    (i) Require the recipient to use the disclosed information only for 
purposes authorized by law and consistent with an agreement that meets 
the requirements ofSec. 603.10;
    (ii) Require the recipient to store the disclosed information in a 
place physically secure from access by unauthorized persons;
    (iii) Require the recipient to store and process disclosed 
information maintained in electronic format, such as magnetic tapes or 
discs, in such a way that unauthorized persons cannot obtain the 
information by any means;
    (iv) Require the recipient to undertake precautions to ensure that 
only authorized personnel are given access to disclosed information 
stored in computer systems;
    (v) Require each recipient agency or entity to:
    (A) Instruct all personnel having access to the disclosed 
information about confidentiality requirements, the requirements of this 
subpart B, and the sanctions specified in the State law for unauthorized 
disclosure of information, and
    (B) Sign an acknowledgment that all personnel having access to the 
disclosed information have been instructed in accordance with paragraph 
(b)(1)(v)(A) of this section and will adhere to the State's or State UC 
agency's confidentiality requirements and procedures which are 
consistent with this subpart B and the agreement required bySec. 
603.10, and agreeing to report any infraction of these rules to the 
State UC agency fully and promptly,
    (vi) Require the recipient to dispose of information disclosed or 
obtained, and any copies thereof made by the recipient agency, entity, 
or contractor, after the purpose for which the information is disclosed 
is served, except for disclosed information possessed by any court. 
Disposal means return of the information to the disclosing State or 
State UC agency or destruction of the information, as directed by the 
State or State UC agency. Disposal includes deletion of personal 
identifiers by the State or State UC agency in lieu of destruction. In 
any case, the information disclosed must not be retained with personal 
identifiers for longer than such period of time as the State or State UC 
agency deems appropriate on a case-by-case basis; and
    (vii) Maintain a system sufficient to allow an audit of compliance 
with the requirements of this part.

[[Page 32]]

    (2) In the case of disclosures made underSec. 603.5(d)(2) (to a 
third party (other than an agent) or disclosures made on an ongoing 
basis), the State or State UC agency must also--
    (i) Periodically audit a sample of transactions accessing 
information disclosed under that section to assure that the entity 
receiving disclosed information has on file a written release 
authorizing each access. The audit must ensure that the information is 
not being used for any unauthorized purpose;
    (ii) Ensure that all employees of entities receiving access to 
information disclosed underSec. 603.5(d)(2) are subject to the same 
confidentiality requirements, and State criminal penalties for violation 
of those requirements, as are employees of the State UC agency.
    (c) Redisclosure of confidential UC information. (1) A State or 
State UC agency may authorize any recipient of confidential UC 
information under paragraph (a) of this section to redisclose 
information only as follows:
    (i) To the individual or employer who is the subject of the 
information;
    (ii) To an attorney or other duly authorized agent representing the 
individual or employer;
    (iii) In any civil or criminal proceedings for or on behalf of a 
recipient agency or entity;
    (iv) In response to a subpoena only as provided inSec. 603.7;
    (v) To an agent or contractor of a public official only if the 
person redisclosing is a public official, if the redisclosure is 
authorized by the State law, and if the public official retains 
responsibility for the uses of the confidential UC information by the 
agent or contractor;
    (vi) From one public official to another if the redisclosure is 
authorized by the State law;
    (vii) When so authorized by Section 303(e)(5), SSA, (redisclosure of 
wage information by a State or local child support enforcement agency to 
an agent under contract with such agency for purposes of carrying out 
child support enforcement) and by State law; or
    (viii) When specifically authorized by a written release that meets 
the requirements ofSec. 603.5(d) (to a third party with informed 
consent).
    (2) Information redisclosed under paragraphs (c)(1)(v) and (vi) of 
this section must be subject to the safeguards in paragraph (b) of this 
section.
    (d) The requirements of this section do not apply to disclosures of 
UC information to a Federal agency which the Department has determined, 
by notice published in the Federal Register, to have in place safeguards 
adequate to satisfy the confidentiality requirement of Section 
303(a)(1), SSA.



Sec.  603.10  What are the requirements for agreements?

    (a) Requirements. (1) For disclosures of confidential UC information 
underSec. 603.5(d)(2) (to a third party (other than an agent) or 
disclosures made on an ongoing basis);Sec. 603.5(e) (to a public 
official), except as provided in paragraph (d) of this section;Sec. 
603.5(f) (to an agent or contractor of a public official);Sec. 
603.6(b)(1) through (4), (6), and (7)(i) (as required by Federal UC 
law); andSec. 603.22 (to a requesting agency for purposes of an IEVS), 
a State or State UC agency must enter into a written, enforceable 
agreement with any agency or entity requesting disclosure(s) of such 
information. The agreement must be terminable if the State or State UC 
agency determines that the safeguards in the agreement are not adhered 
to.
    (2) For disclosures referred to inSec. 603.5(f) (to an agent or 
contractor of a public official), the State or State UC agency must 
enter into a written, enforceable agreement with the public official on 
whose behalf the agent or contractor will obtain information. The 
agreement must hold the public official responsible for ensuring that 
the agent or contractor complies with the safeguards ofSec. 603.9. The 
agreement must be terminable if the State or State UC agency determines 
that the safeguards in the agreement are not adhered to.
    (b) Contents of agreement--(1) In general. Any agreement required by 
paragraph (a) of this section must include, but need not be limited to, 
the following terms and conditions:
    (i) A description of the specific information to be furnished and 
the purposes for which the information is sought;
    (ii) A statement that those who request or receive information under 
the

[[Page 33]]

agreement will be limited to those with a need to access it for purposes 
listed in the agreement;
    (iii) The methods and timing of requests for information and 
responses to those requests, including the format to be used;
    (iv) Provision for paying the State or State UC agency for any costs 
of furnishing information, as required bySec. 603.8 (on costs);
    (v) Provision for safeguarding the information disclosed, as 
required bySec. 603.9 (on safeguards); and
    (vi) Provision for on-site inspections of the agency, entity, or 
contractor, to assure that the requirements of the State's law and the 
agreement or contract required by this section are being met.
    (2) In the case of disclosures underSec. 603.5(d)(2) (to a third 
party (other than an agent) or disclosures made on an ongoing basis), 
the agreement required by paragraph (a) of this section must assure that 
the information will be accessed by only those entities with 
authorization under the individual's or employer's release, and that it 
may be used only for the specific purposes authorized in that release.
    (c) Breach of agreement--(1) In general. If an agency, entity, or 
contractor, or any official, employee, or agent thereof, fails to comply 
with any provision of an agreement required by this section, including 
timely payment of the State's or State UC agency's costs billed to the 
agency, entity, or contractor, the agreement must be suspended, and 
further disclosure of information (including any disclosure being 
processed) to such agency, entity, or contractor is prohibited, until 
the State or State UC agency is satisfied that corrective action has 
been taken and there will be no further breach. In the absence of prompt 
and satisfactory corrective action, the agreement must be canceled, and 
the agency, entity, or contractor must be required to surrender to the 
State or State UC agency all confidential UC information (and copies 
thereof) obtained under the agreement which has not previously been 
returned to the State or State UC agency, and any other information 
relevant to the agreement.
    (2) Enforcement. In addition to the actions required to be taken by 
paragraph (c)(1) of this section, the State or State UC agency must 
undertake any other action under the agreement, or under any law of the 
State or of the United States, to enforce the agreement and secure 
satisfactory corrective action or surrender of the information, and must 
take other remedial actions permitted under State or Federal law to 
effect adherence to the requirements of this subpart B, including 
seeking damages, penalties, and restitution as permitted under such law 
for any charges to granted funds and all costs incurred by the State or 
the State UC agency in pursuing the breach of the agreement and 
enforcement as required by this paragraph (c).
    (d) The requirements of this section do not apply to disclosures of 
UC information to a Federal agency which the Department has determined, 
by notice published in the Federal Register, to have in place safeguards 
adequate to satisfy the confidentiality requirement of Section 
303(a)(1), SSA, and an appropriate method of paying or reimbursing the 
State UC agency (which may involve a reciprocal cost arrangement) for 
costs involved in such disclosures. These determinations will be 
published in the Federal Register.



Sec.  603.11  How do States notify claimants and employers about the
uses of their information?

    (a) Claimants. Every claimant for compensation must be notified, at 
the time of application, and periodically thereafter, that confidential 
UC information pertaining to the claimant may be requested and utilized 
for other governmental purposes, including, but not limited to, 
verification of eligibility under other government programs. Notice on 
or attached to subsequent additional claims will satisfy the requirement 
for periodic notice thereafter.
    (b) Employers. Every employer subject to a State's law must be 
notified that wage information and other confidential UC information may 
be requested and utilized for other governmental purposes, including, 
but not limited to, verification of an individual's eligibility for 
other government programs.

[[Page 34]]



Sec.  603.12  How are the requirements of this part enforced?

    (a) Resolving conformity and compliance issues. For the purposes of 
resolving issues of conformity and substantial compliance with the 
requirements set forth in subparts B and C, the provisions of 20 CFR 
601.5(b) (informal discussions with the Department of Labor to resolve 
conformity and substantial compliance issues), and 20 CFR 601.5(d) 
(Secretary of Labor's hearing and decision on conformity and substantial 
compliance) apply.
    (b) Conformity and substantial compliance. Whenever the Secretary of 
Labor, after reasonable notice and opportunity for a hearing to the 
State UC agency of a State, finds that the State law fails to conform, 
or that the State or State UC agency fails to comply substantially, 
with:
    (1) The requirements of Title III, SSA, implemented in subparts B 
and C of this part, the Secretary of Labor shall notify the Governor of 
the State and such State UC agency that further payments for the 
administration of the State UC law will not be made to the State until 
the Secretary of Labor is satisfied that there is no longer any such 
failure. Until the Secretary of Labor is so satisfied, the Department of 
Labor shall make no further payments to such State.
    (2) The FUTA requirements implemented in this subpart B, the 
Secretary of Labor shall make no certification under that section to the 
Secretary of the Treasury for such State as of October 31 of the 12-
month period for which such finding is made.



 Subpart C_Mandatory Disclosure for Income and Eligibility Verification 
                              System (IEVS)



Sec.  603.20  What is the purpose and scope of this subpart?

    (a) Purpose. Subpart C implements Section 303(f), SSA. Section 
303(f) requires States to have in effect an income and eligibility 
verification system, which meets the requirements of Section 1137, SSA, 
under which information is requested and exchanged for the purpose of 
verifying eligibility for, and the amount of, benefits available under 
several federally assisted programs, including the Federal-State UC 
program.
    (b) Scope. This subpart C applies only to a State UC agency.

    Note to paragraph (b): Although not implemented in this part 603, 
Section 1137(a)(1), SSA, provides that each State must require claimants 
for compensation to furnish to the State UC agency their social security 
account numbers, as a condition of eligibility for compensation, and 
further requires States to utilize such account numbers in the 
administration of the State UC laws. Section 1137(a)(3), SSA, further 
provides that employers must make quarterly wage reports to a State UC 
agency, or an alternative agency, for use in verifying eligibility for, 
and the amount of, benefits. Section 1137(d)(1), SSA, provides that each 
State must require claimants for compensation, as a condition of 
eligibility, to declare in writing, under penalty of perjury, whether 
the individual is a citizen or national of the United States, and, if 
not, that the individual is in a satisfactory immigration status. Other 
provisions of Section 1137(d), SSA, not implemented in this regulation 
require the States to obtain, and individuals to furnish, information 
which shows immigration status, and require the States to verify 
immigration status with the Bureau of Citizenship and Immigration 
Services.



Sec.  603.21  What is a requesting agency?

    For the purposes of this subpart C, requesting agency means:
    (a) Temporary Assistance to Needy Families Agency--Any State or 
local agency charged with the responsibility of administering a program 
funded under part A of Title IV of the SSA.
    (b) Medicaid Agency--Any State or local agency charged with the 
responsibility of administering the provisions of the Medicaid program 
under a State plan approved under Title XIX of the SSA.
    (c) Food Stamp Agency--Any State or local agency charged with the 
responsibility of administering the provisions of the Food Stamp Program 
under the Food Stamp Act of 1977.
    (d) Other SSA Programs Agency--Any State or local agency charged 
with the responsibility of administering a program under a State plan 
approved under Title I, X, XIV, or XVI (Supplemental Security Income for 
the Aged, Blind, and Disabled) of the SSA.
    (e) Child Support Enforcement Agency--Any State or local child 
support

[[Page 35]]

enforcement agency charged with the responsibility of enforcing child 
support obligations under a plan approved under part D of Title IV of 
the SSA.
    (f) Social Security Administration--Commissioner of the Social 
Security Administration in establishing or verifying eligibility or 
benefit amounts under Titles II (Old-Age, Survivors, and Disability 
Insurance Benefits) and XVI (Supplemental Security Income for the Aged, 
Blind, and Disabled) of the SSA.



Sec.  603.22  What information must State UC agencies disclose for
purposes of an IEVS?

    (a) Disclosure of information. Each State UC agency must disclose, 
upon request, to any requesting agency, as defined inSec. 603.21, that 
has entered into an agreement required bySec. 603.10, wage information 
(as defined atSec. 603.2(k)) and claim information (as defined at 
Sec.  603.2(a)) contained in the records of such State UC agency.
    (b) Format. The State UC agency must adhere to standardized formats 
established by the Secretary of HHS (in consultation with the Secretary 
of Agriculture) and set forth in 42 CFR 435.960 (concerning standardized 
formats for furnishing and obtaining information to verify income and 
eligibility).



Sec.  603.23  What information must State UC agencies obtain from 
other agencies, and crossmatch with wage information, for purposes
of an IEVS?

    (a) Crossmatch with information from requesting agencies. Each State 
UC agency must obtain such information from the Social Security 
Administration and any requesting agency as may be needed in verifying 
eligibility for, and the amount of, compensation payable under the State 
UC law.
    (b) Crossmatch of wage and benefit information. The State UC agency 
must crossmatch quarterly wage information with UC payment information 
to the extent that such information is likely, as determined by the 
Secretary of Labor, to be productive in identifying ineligibility for 
benefits and preventing or discovering incorrect payments.



PART 604_REGULATIONS FOR ELIGIBILITY FOR UNEMPLOYMENT COMPENSATION--
Table of Contents



Sec.
604.1 Purpose and scope.
604.2 Definitions.
604.3 Able and available requirement--general principles.
604.4 Application--ability to work.
604.5 Application--availability for work.
604.6 Conformity and substantial compliance.

    Authority: 42 U.S.C. 1302(a); 42 U.S.C. 503(a)(2) and (5); 26 U.S.C. 
3304(a)(1) and (4); 26 U.S.C. 3306(h); 42 U.S.C. 1320b-7(d); Secretary's 
Order No. 4-75 (40 FR 18515); and Secretary's Order No. 14-75 (November 
12, 1975).

    Source: 72 FR 1893, Jan. 16, 2007, unless otherwise noted.



Sec.  604.1  Purpose and scope.

    The purpose of this Part is to implement the requirements of Federal 
UC law that limit a State's payment of UC to individuals who are able to 
work and available for work. This regulation applies to all State UC 
laws and programs.



Sec.  604.2  Definitions.

    (a) Department means the United States Department of Labor.
    (b) FUTA means the Federal Unemployment Tax Act, 26 U.S.C. 3301 et 
seq.
    (c) Social Security Act means the Social Security Act, 42 U.S.C. 501 
et seq.
    (d) State means a State of the United States of America, the 
District of Columbia, the Commonwealth of Puerto Rico, and the United 
States Virgin Islands.
    (e) State UC agency means the agency of the State charged with the 
administration of the State's UC law.
    (f) State UC law means the law of a State approved under Section 
3304(a), FUTA (26 U.S.C. 3304(a)).
    (g) Unemployment Compensation (UC) means cash benefits payable to 
individuals with respect to their unemployment.
    (h) Week of unemployment means a week of total, part-total or 
partial unemployment as defined in the State's UC law.

[[Page 36]]



Sec.  604.3  Able and available requirement--general principles.

    (a) A State may pay UC only to an individual who is able to work and 
available for work for the week for which UC is claimed.
    (b) Whether an individual is able to work and available for work 
under paragraph (a) of this section must be tested by determining 
whether the individual is offering services for which a labor market 
exists. This requirement does not mean that job vacancies must exist, 
only that, at a minimum, the type of services the individual is able and 
available to perform is generally performed in the labor market. The 
State must determine the geographical scope of the labor market for an 
individual under its UC law.
    (c) The requirement that an individual be able to work and available 
for work applies only to the week of unemployment for which UC is 
claimed. It does not apply to the reasons for the individual's 
separation from employment, although the separation may indicate the 
individual was not able to work or available for work during the week 
the separation occurred. This Part does not address the authority of 
States to impose disqualifications with respect to separations. This 
Part does not limit the States' ability to impose additional able and 
available requirements that are consistent with applicable Federal laws.



Sec.  604.4  Application--ability to work.

    (a) A State may consider an individual to be able to work during the 
week of unemployment claimed if the individual is able to work for all 
or a portion of the week claimed, provided any limitation on his or her 
ability to work does not constitute a withdrawal from the labor market.
    (b) If an individual has previously demonstrated his or her ability 
to work and availability for work following the most recent separation 
from employment, the State may consider the individual able to work 
during the week of unemployment claimed despite the individual's illness 
or injury, unless the individual has refused an offer of suitable work 
due to such illness or injury.



Sec.  604.5  Application--availability for work.

    (a) General application. A State may consider an individual to be 
available for work during the week of unemployment claimed under any of 
the following circumstances:
    (1) The individual is available for any work for all or a portion of 
the week claimed, provided that any limitation placed by the individual 
on his or her availability does not constitute a withdrawal from the 
labor market.
    (2) The individual limits his or her availability to work which is 
suitable for such individual as determined under the State UC law, 
provided the State law definition of suitable work does not permit the 
individual to limit his or her availability in such a way that the 
individual has withdrawn from the labor market. In determining whether 
the work is suitable, States may, among other factors, take into 
consideration the education and training of the individual, the 
commuting distance from the individual's home to the job, the previous 
work history of the individual (including salary and fringe benefits), 
and how long the individual has been unemployed.
    (3) The individual is on temporary lay-off and is available to work 
only for the employer that has temporarily laid-off the individual.
    (b) Jury service. If an individual has previously demonstrated his 
or her availability for work following the most recent separation from 
employment and is appearing for duty before any court under a lawfully 
issued summons during the week of unemployment claimed, a State may 
consider the individual to be available for work. For such an 
individual, attendance at jury duty may be taken as evidence of 
continued availability for work. However, if the individual does not 
appear as required by the summons, the State must determine if the 
reason for non-attendance indicates that the individual is not able to 
work or is not available for work.
    (c) Approved training. A State must not deny UC to an individual for 
failure to be available for work during a week if, during such week, the 
individual is in training with the approval of the

[[Page 37]]

State agency. However, if the individual fails to attend or otherwise 
participate in such training, the State must determine if the reason for 
non-attendance or non-participation indicates that the individual is not 
able to work or is not available for work.
    (d) Self-employment assistance. A State must not deny UC to an 
individual for failure to be available for work during a week if, during 
such week, the individual is participating in a self-employment 
assistance program and meets all the eligibility requirements of such 
self-employment assistance program.
    (e) Short-time compensation. A State must not deny UC to an 
individual participating in a short-time compensation (also known as 
worksharing) program under State UC law for failure to be available for 
work during a week, but such individual will be required to be available 
for his or her normal workweek.
    (f) Alien status. To be considered available for work in the United 
States for a week, the alien must be legally authorized to work that 
week in the United States by the appropriate agency of the United States 
government. In determining whether an alien is legally authorized to 
work in the United States, the State must follow the requirements of 
section 1137(d) of the SSA (42 U.S.C. 1320b-7(d)), which relate to 
verification of and determination of an alien's status.
    (g) Relation to ability to work requirement. A State may consider an 
individual available for work if the State finds the individual able to 
work underSec. 604.4(b) despite illness or injury.
    (h) Work search. The requirement that an individual be available for 
work does not require an active work search on the part of the 
individual. States may, however, require an individual to be actively 
seeking work to be considered available for work, or States may impose a 
separate requirement that the individual must actively seek work.



Sec.  604.6  Conformity and substantial compliance.

    (a) In general. A State's UC law must conform with, and the 
administration of its law must substantially comply with, the 
requirements of this regulation for purposes of certification under:
    (1) Section 3304(c) of the FUTA (26 U.S.C. 3304(c)), with respect to 
whether employers are eligible to receive credit against the Federal 
unemployment tax established by section 3301 of the FUTA (26 U.S.C. 
3301), and
    (2) Section 302 of the SSA (42 U.S.C. 502), with respect to whether 
a State is eligible to receive Federal grants for the administration of 
its UC program.
    (b) Resolving Issues of Conformity and Substantial Compliance. For 
the purposes of resolving issues of conformity and substantial 
compliance with the requirements of this regulation, the following 
provisions of 20 CFR 601.5 apply:
    (1) Paragraph (b) of this section, pertaining to informal 
discussions with the Department of Labor to resolve conformity and 
substantial compliance issues, and
    (2) Paragraph (d) of this section, pertaining to the Secretary of 
Labor's hearing and decision on conformity and substantial compliance.
    (c) Result of failure to conform or substantially comply--(1) FUTA 
requirements. Whenever the Secretary of Labor, after reasonable notice 
and opportunity for a hearing to the State UC agency, finds that the 
State UC law fails to conform, or that the State or State UC agency 
fails to comply substantially, with the requirements of the FUTA, as 
implemented in this regulation, then the Secretary of Labor shall make 
no certification under such act to the Secretary of the Treasury for 
such State as of October 31 of the 12-month period for which such 
finding is made. Further, the Secretary of Labor must notify the 
Governor of the State and such State UC agency that further payments for 
the administration of the State UC law will not be made to the State.
    (2) SSA requirements. Whenever the Secretary of Labor, after 
reasonable notice and opportunity for a hearing to the State UC agency, 
finds that the State UC law fails to conform, or that the State or State 
UC agency fails to comply substantially, with the requirements of title 
III, SSA (42 U.S.C. 501-504), as implemented in this regulation,

[[Page 38]]

then the Secretary of Labor must notify the Governor of the State and 
such State UC agency that further payments for the administration of the 
State UC law will not be made to the State until the Secretary of Labor 
is satisfied that there is no longer any such failure. Until the 
Secretary of Labor is so satisfied, the Department of Labor will not 
make further payments to such State.



PART 606_TAX CREDITS UNDER THE FEDERAL UNEMPLOYMENT TAX ACT; ADVANCES
UNDER TITLE XII OF THE SOCIAL SECURITY ACT--Table of Contents



                            Subpart A_General

Sec.
606.1 Purpose and scope.
606.2 Total credits allowable.
606.3 Definitions.
606.4 Redelegation of authority.
606.5 Verification of estimates and review of determinations.
606.6 Information, reports, and studies.

Subpart B--Tax Credit Reduction [Reserved]

               Subpart C_Relief From Tax Credit Reduction

606.20 Cap on tax credit reduction.
606.21 Criteria for cap.
606.22 Application for cap.
606.23 Avoidance of tax credit reduction.
606.24 Application for avoidance.
606.25 Waiver of and substitution for additional tax credit reduction.
606.26 Application for waiver and substitution.

                     Subpart D_Interest on Advances

606.30 Interest rates on advances.
606.31 Due dates for payment of interest. [Reserved]
606.32 Types of advances subject to interest.
606.33 No payment of interest from unemployment fund. [Reserved]
606.34 Reports of interest payable. [Reserved]
606.35 Order of application for repayments. [Reserved]

                 Subpart E_Relief from Interest Payment

606.40 May/September delay.
606.41 High unemployment deferral.
606.42 High unemployment delay.
606.44 Notification of determinations.

    Authority: 42 U.S.C. 1102; 42 U.S.C. 1322(b)(2)(C); 26 U.S.C. 
7805(a); Secretary's Order No. 3-2007, April 3, 2007 (72 FR 15907).

    Source: 53 FR 37429, Sept. 26, 1988, unless otherwise noted.

    Editorial Note: Nomenclature changes to part 606 appear at 71 FR 
35513, June 21, 2006.



                            Subpart A_General



Sec.  606.1  Purpose and scope.

    (a) In general. The regulations in this part 606 are issued to 
implement the tax credit provisions of the Federal Unemployment Tax Act, 
and the loan provisions of title XII of the Social Security Act. The 
regulations on tax credits cover all of the subjects of 3302 of the 
Federal Unemployment Tax Act (FUTA), except subsections (c)(3) and (e). 
The regulations on loans cover all of the subjects in title XII of the 
Social Security Act.
    (b) Scope. This part 606 covers general matters relating to this 
part in this subpart A, and in the following subparts includes specific 
subjects described in general terms as follows:
    (1) Subpart B describes the tax credit reductions under the Federal 
Unemployment Tax Act, which relate to outstanding balances of advances 
made under title XII of the Social Security Act.
    (2) Subpart C describes the various forms of relief from tax credit 
reductions, and the criteria and standards for grant of such relief in 
the form of--
    (i) A cap on tax credit reduction,
    (ii) Avoidance of tax credit reduction, and
    (iii) Waiver of and substitution for additional tax credit 
reduction.
    (3) Subpart D describes the interest rates on advances made under 
title XII of the Social Security Act, dues dates for payment of 
interest, and other related matters.
    (4) Subpart E describes the various forms of relief from payment of 
interest, and the criteria and standards for grant of such relief in the 
form of--
    (i) May/September delay of interest payments,
    (ii) High unemployment deferral of interest payments,
    (iii) High unemployment delay of interest payments, and

[[Page 39]]

    (iv) Maintenance of solvency effort required to retain a deferral 
previously granted.



Sec.  606.2  Total credits allowable.

    The total credits allowed to an employer subject to the tax imposed 
by section 3301 of the Federal Unemployment Tax Act shall not exceed 5.4 
percent with respect to taxable years beginning after December 31, 1984.



Sec.  606.3  Definitions.

    For the purposes of the Acts cited and this part--
    Act means as appropriate the Federal Unemployment Tax Act (26 U.S.C. 
3301-3311), or title XII of the Social Security Act (42 U.S.C. 1321-
1324).
    Advance means a transfer of funds to a State unemployment fund, for 
the purpose of paying unemployment compensation, from the Federal 
unemployment account in the Unemployment Trust Fund, pursuant to section 
1202 of the Social Security Act.
    Average High Cost Multiple (AHCM) for a State as of December 31 of a 
calendar year is calculated by dividing the State's reserve ratio, as 
defined inSec. 606.3, by the State's average high cost rate (AHCR), as 
defined inSec. 606.3, for the same year. Final calculations are 
rounded to the nearest multiple of 0.01.
    Average High Cost Rate (AHCR) for a State is calculated as follows:
    (1) Determine the time period over which calculations are to be made 
by selecting the longer of:
    (i) The 20-calendar year period that ends with the year for which 
the AHCR calculation is made; or
    (ii) The number of years beginning with the calendar year in which 
the first of the last three completed national recessions began, as 
determined by the National Bureau of Economic Research, and ending with 
the calendar year for which the AHCR is being calculated.
    (2) For each calendar year during the selected time period, 
calculate the benefit-cost ratio, as defined inSec. 606.3; and
    (3) Average the three highest calendar year benefit cost ratios for 
the selected time period from paragraph (2) of this definition. Final 
calculations are rounded to the nearest multiple of 0.01 percent.
    Benefit-cost ratio for a calendar year is the percentage obtained by 
dividing--
    (1) The total dollar sum of--
    (i) All compensation actually paid under the State law during such 
calendar year, including in such total sum all regular, additional, and 
extended compensation, as defined in section 205 of the Federal-State 
Extended Unemployment Compensation Act of 1970, and excluding from such 
total sum--
    (A) Any such compensation paid for which the State is entitled to 
reimbursement or was reimbursed under the provisions of any Federal Law, 
and
    (B) Any such compensation paid which is attributable to services 
performed for a reimbursing employer, and which is not included in the 
total dollar amount reported under paragraph (c)(1)(i)(A) of this 
section, and
    (ii) Any interest paid during such calendar year on any advance, by
    (2) The total wages (as defined inSec. 606.3) with respect to such 
calendar year.
    (3) For cap purposes, if any percentage determined by this 
computation for a calendar year is not a multiple of 0.1 percent, such 
percentage shall be reduced to the nearest multiple of 0.1 percent. For 
funding goal purposes, if any percentage determined by this computation 
for a calendar year is not a multiple of 0.01 percent, such percentage 
is rounded to the nearest multiple of 0.01 percent.
    Contributions means payments required by a State law to be made into 
an unemployment fund by any person on account of having individuals in 
his employ, to the extent that such payments are made by him without 
being deducted or deductible from the remuneration of individuals in his 
employ.
    Federal unemployment tax means the excise tax imposed under section 
3301 of the Federal Unemployment Tax Act on employers with respect to 
having individuals in their employ.
    Fiscal year means the Federal fiscal year which begins on October 1 
of a year and ends on September 30, of the next succeeding year.
    FUTA refers to the Federal Unemployment Tax Act.
    Reserve ratio is calculated by dividing the balance in the State's 
account in

[[Page 40]]

the unemployment trust fund (UTF) as of December 31 of such year by the 
total wages paid workers covered by the unemployment compensation (UC) 
program during the 12 months ending on December 31 of such year. Final 
calculations are rounded to the nearest multiple of 0.01 percent.
    State unemployment fund or unemployment fund means a special fund 
established under a State law for the payment of unemployment 
compensation to unemployed individuals, and which is an ``unemployment 
fund'' as defined in section 3306(f) of the Federal Unemployment Tax 
Act.
    Taxable year means the calendar year.
    Unemployment tax rate means, for any taxable year and with respect 
to any State, the percentage obtained by dividing the total amount of 
contributions paid into the State unemployment fund with respect to such 
taxable year by total wages as defined inSec. 606.3.
    Wages, taxable means the total sum of remuneration which is subject 
to contributions under a State law.
    Wages, total means the total sum of all remuneration covered by a 
State law, disregarding any dollar limitation on the amount of 
remuneration which is subject to contributions under the State law.

[53 FR 37429, Sept. 26, 1988, as amended at 71 FR 35513, June 21, 2006; 
75 FR 57156, Sept. 17, 2010]



Sec.  606.4  Redelegation of authority.

    (a) Redelegation to OWS Administrator. The Administrator, Office of 
Workforce Security (hereinafter ``OWS Administrator''), is redelegated 
authority to make the determinations required under this part. This 
redelegation is contained in Employment and Training Order No. 1-84, 
published in the Federal Register on November 14, 1983 (48 FR 51870).
    (b) Delegation by Governor. The Governor of a State, as used in this 
part, refers to the highest executive official of a State. Wherever in 
this part an action is required by or of the Governor of a State, such 
action may be taken by the Governor or may be taken by a delegatee of 
the Governor if the Department is furnished appropriate proof of an 
authoritative delegation of authority.

[53 FR 37429, Sept. 26, 1988, as amended at 71 FR 35514, June 21, 2006]



Sec.  606.5  Verification of estimates and review of determinations.

    The Department of Labor (hereinafter ``Department'') shall verify 
all information and data provided by a State under this part, and the 
State shall comply with such provisions as the Department considers 
necessary to assure the correctness and verification of such information 
and data. The State agency of a State affected by a determination made 
by the OWS Administrator under this part may seek review of such 
determination by a higher level official of the Employment and Training 
Administration.



Sec.  606.6  Information, reports, and studies.

    A State shall furnish to the Secretary of Labor such information and 
reports and conduct such studies as the Secretary determines are 
necessary or appropriate for carrying out the purposes of this part, 
including any additional information or data the OWS Administrator may 
require for the purposes of making determinations under subparts C and E 
of this part.

[53 FR 37429, Sept. 26, 1988, as amended at 71 FR 35514, June 21, 2006]

Subpart B--Tax Credit Reduction [Reserved]



               Subpart C_Relief From Tax Credit Reduction



Sec.  606.20  Cap on tax credit reduction.

    (a) Applicability. Subsection (f) of section 3302 of FUTA authorizes 
a limitation (cap) on the reduction of tax credits by reason of an 
outstanding balance of advances, if the OWS Administrator determines 
with respect to a State, on or before November 10 of a taxable year, 
that--
    (1) No action was taken by the State during the 12-month period 
ending on September 30 of such taxable year which has resulted, or will 
result, in a reduction in the State's unemployment tax effort, as 
defined inSec. 606.21(a);

[[Page 41]]

    (2) No action was taken by the State during the 12-month period 
ending on September 30 of such taxable year which has resulted, or will 
result, in a net decrease in the solvency of the State unemployment 
compensation system, as defined inSec. 606.21(b);
    (3) The State unemployment tax rate (as defined inSec. 606.3) for 
the taxable year equals or exceeds the average benefit-cost ratio (as 
defined inSec. 606.3) for the calendar years in the five-calendar year 
period ending with the calendar year immediately preceding the taxable 
year for which the cap is requested, under the rules specified inSec. 
606.21 (c) and (d); and
    (4) The outstanding balance of advances to the State on September 30 
of the taxable year was not greater than the outstanding balance of 
advances to the State on September 30 of the third preceding taxable 
year.
    (b) Maximum tax credit reduction. If a State qualifies for a cap, 
the maximum tax credit reduction for the taxable year shall not exceed 
0.6 percent, or, if higher, the tax credit reduction that was in effect 
for the taxable year preceding the taxable year for which the cap is 
requested.
    (c) Year not taken into account. If a State qualifies for a cap for 
any year, the year and January 1 of the year to which the cap applies 
will not be taken into account for purposes of determining reduction of 
tax credit for subsequent taxable years.
    (d) Partial caps. Partial caps obtained under subsection (f)(8) are 
no longer available. Nevertheless, for the purposes of applying section 
3302(c)(2) to subsequent taxable years, partial cap credits earned will 
be taken into account for purposes of determining reduction of tax 
credits. Also, the taxable year to which the partial cap applied (and 
January 1 thereof) will be taken into account for purposes of 
determining reduction of tax credits for subsequent taxable years.

[53 FR 37429, Sept. 26, 1988, as amended at 75 FR 57156, Sept. 17, 2010]



Sec.  606.21  Criteria for cap.

    (a) Reduction in unemployment tax effort. (1) For purposes of 
paragraph (a)(1) ofSec. 606.20, a reduction in a State's unemployment 
tax effort will have occurred with respect to a taxable year if any 
action is or was taken (legislative, judicial, or administrative,) that 
is effective during the 12-month period ending on September 30 of such 
taxable year, which has resulted in or will result in a reduction of the 
amount of contributions paid or payable or the amounts that were or 
would have been paid or payable but for such action.
    (2) Actions that will result in a reduction in tax effort include, 
but are not limited to, a reduction in the taxable wage base, the tax 
rate schedule, tax rates, or taxes payable (including surtaxes) that 
would not have gone into effect but for the legislative, judicial, or 
administrative action taken. Notwithstanding the foregoing criterion, a 
reduction in unemployment tax effort resulting from any provision of the 
State law enacted prior to August 13, 1981, will not be taken into 
account as a reduction in the State's unemployment tax effort for the 
purposes of this section.
    (b) Net decrease in solvency. For purposes of paragraph (a)(2) of 
Sec.  606.20, a net decrease in the solvency of the State's unemployment 
compensation system will have occurred with respect to a taxable year if 
any action is or was taken (legislative, judicial, or administrative), 
that is effective during the 12-month period ending on September 30 of 
such taxable year, which has resulted in or will result in an increase 
in benefits without at least an equal increase in taxes, or a decrease 
in taxes without at least an equal decrease in benefits. Notwithstanding 
the foregoing criterion, a decrease in solvency resulting from any 
provision of the State law enacted prior to August 13, 1981, will not be 
taken into account as a reduction in solvency of the State's 
unemployment compensation system for the purposes of this section.
    (c) State unemployment tax rate. For purposes of paragraph (a)(3) of 
Sec.  606.20, the State unemployment tax rate is defined inSec. 606.3. 
If such percentage is not a multiple of 0.1 percent, the percentage 
shall remain unrounded.
    (d) State five-year average benefit cost ratio. The average benefit-
cost ratio for the 5 preceding calendar years is the percentage 
determined by dividing the sum of the benefit-cost ratios for the 5

[[Page 42]]

years by five. If such percentage is not a multiple of 0.1 percent, the 
percentage shall remain unrounded.

[53 FR 37429, Sept. 26, 1988, as amended at 75 FR 57156, Sept. 17, 2010]



Sec.  606.22  Application for cap.

    (a) Application. (1) The Governor of the State shall make 
application, addressed to the Secretary of Labor, no later than July 1 
of a taxable year with respect to which a State requests a cap on tax 
credit reduction. The Governor is required to notify the Department on 
or before October 15 of such taxable year of any action occurring after 
the date of the initial application and effective prior to October 1 of 
such year that would impact upon the State's application.
    (2) The OWS Administrator will make a determination on the 
application on or before November 10 of such taxable year, will notify 
the applicant and the Secretary of the Treasury of such determination, 
and will cause notice of such determination to be published in the 
Federal Register.
    (b) Anticipated impact statement. In support of the application by 
the Governor, there shall be submitted with the application (on or 
before October 15), for the purposes of the criteria described in 
Sec.Sec. 606.20(a) (1) and (2) and 606.21 (a) and (b), a description 
of all statutory provisions enacted or amended, regulations adopted or 
revised, administrative policies and procedures adopted or revised, and 
judicial decisions given effect, which are effective during the 12-month 
period ending on September 30 of the taxable year for which a cap on tax 
credit reduction is requested, and an anticipated impact statement (AIS) 
for each such program action in the following respect--
    (1) The estimated dollar effect on each program action upon 
expenditures for compensation from the State unemployment fund and for 
the amounts of contributions paid or payable in such 12-month period, 
including the effect of interaction among program actions, and with 
respect to program actions for which dollar impact cannot be estimated 
or is minor or negligible, indicate whether the impact is positive or 
negative;
    (2) If a program action has no such dollar effect, an explanation of 
why there is or will be no such effect;
    (3) A description of assumptions and methodology used and the basis 
for the financial estimate of the impact of each program action 
described in paragraphs (b)(1) and (b)(2) of this section; and
    (4) A comparision of the program actions described in paragraphs 
(b)(1) and (b)(2) of this section with the program actions prior to the 
Federal fiscal year (as defined inSec. 606.3) which ends on such 
September 30.
    (c) Unemployment tax rate. With respect to the unemployment tax rate 
criterion described in Sec.Sec. 606.20(a)(3) and 606.21(c), the 
application shall include an estimate for the taxable year with respect 
to which a cap on tax credit reduction is requested and actual data for 
the prior two years as follows:
    (1) The amount of taxable wages as defined inSec. 606.3;
    (2) The amount of total wages as defined inSec. 606.3; and
    (3) The estimated distribution of taxable wages, as defined inSec. 
606.3, by tax rate under the State law.
    (d) Benefit cost ratio. With respect to the benefit cost ratio 
criterion described in Sec.Sec. 606.20(a)(3) and 606.21(d), the 
application shall include for each of the five calendar years prior to 
the taxable year for which a cap on tax credit reduction is requested, 
the following data:
    (1) The total dollar sum of compensation actually paid under the 
State law during the calendar year, including in such total sum all 
regular, additional, and extended compensation as defined in section 205 
of the Federal-State Extended Unemployment Compensation Act of 1970, but 
excluding from such total sum--
    (i) The total dollar amount of such compensation paid for which the 
State is entitled to reimbursement or was reimbursed under the 
provisions of any Federal law;
    (ii) The total dollar amount of such compensation paid which is 
attributable to services performed for a reimbursing employer, and which 
is not included in the total amount reported under paragraph (d)(1)(i) 
of this section;

[[Page 43]]

    (2) The total dollar amount of interest paid during the calendar 
year on any advance; and
    (3) The total dollar amount of wages (as defined inSec. 606.3) 
with respect to such calendar year.
    (e) Documentation required. Copies of the sources of or authority 
for each program action described in paragraph (b) of this section shall 
be submitted with each application for a cap on tax credit reduction. In 
addition, a notation shall be made on each AIS of where all figures 
referred to are contained in reports required by the Department or in 
other data sources.
    (f) State contact person. The Department may request additional 
information or clarification of information submitted bearing upon an 
application for a cap on tax credit reduction. To expedite requests for 
such information, the name and telephone number of an appropriate State 
official shall be included in the application by the Governor.

[53 FR 37429, Sept. 26, 1988, as amended at 75 FR 57156, Sept. 17, 2010]



Sec.  606.23  Avoidance of tax credit reduction.

    (a) Applicability. Subsection (g) of section 3302 of FUTA authorizes 
a State to avoid a tax credit reduction for a taxable year by meeting 
the three requirements of subsection (g). These requirements are met if 
the OWS Administrator determines that:
    (1) Advances were repaid by the State during the one-year period 
ending on November 9 of the taxable year in an amount not less than the 
sum of--
    (i) The potential additional taxes (as estimated by the OWS 
Administrator) that would be payable by the State's employers if 
paragraph (2) of section 3302(c) of FUTA were applied for such taxable 
year (as estimated with regard to the cap on tax credit reduction for 
which the State qualifies under Sec.Sec. 606.20 to 606.22 with respect 
to such taxable year), and
    (ii) Any advances made to such State during such one-year period 
under title XII of the Social Security Act;
    (2) There will be adequate funds in the State unemployment fund (as 
estimated by the OWS Administrator) sufficient to pay all benefits when 
due and payable under the State law during the three-month period 
beginning on November 1 of such taxable year without receiving any 
advance under title XII of the Social Security Act; and
    (3) There is a net increase (as estimated by the OWS Administrator) 
in the solvency of the State unemployment compensation system for the 
taxable year and such net increase equals or exceeds the potential 
additional taxes for such taxable year as estimated under paragraph 
(a)(1)(i) of this section.
    (b) Net increase in solvency. (1) The net increase in solvency for a 
taxable year, as determined for the purposes of paragraph (a)(3) of this 
section, must be attributable to legislative changes made in the State 
law after the later of--
    (i) September 3, 1982, or
    (ii) The date on which the first advance is taken into account in 
determining the amount of the potential additional taxes.
    (2) The OWS Administrator shall determine the net increase in 
solvency by first estimating the difference between revenue receipts and 
benefit outlays under the law in effect for the year for which avoidance 
is requested, as if the relevant changes in State law referred to in 
paragraph (b)(1) of this section were not in effect for such year. The 
OWS Administrator shall then estimate the difference between revenue 
receipts and benefit outlays under the law in effect for the year for 
which the avoidance is requested, taking into account the relevant 
changes in State law referred to in paragraph (b)(1) of this section. 
The amount (if any) by which the second estimated difference exceeds the 
first estimated difference shall constitute the net increase in solvency 
for the purposes of this section.
    (c) Year taken into account. If a State qualifies for avoidance for 
any year, that year and January 1 of that year to which the avoidance 
applies will be taken into account for purposes of determining reduction 
of tax credits for subsequent taxable years.



Sec.  606.24  Application for avoidance.

    (a) Application. (1) The Governor of the State shall make 
application, addressed to the Secretary of Labor, no later than July 1 
of a taxable year with

[[Page 44]]

respect to which a State requests avoidance of tax credit reduction. The 
Governor is required to notify the Department on or before October 15 of 
such taxable year of any action impacting upon the State's application 
occurring subsequent to the date of the initial application and on or 
before November 10.
    (2) The OWS Administrator will make a determination on the 
application as of November 10 of such taxable year, will notify the 
applicant and the Secretary of the Treasury of such determination, and 
will cause notice of such determination to be published in the Federal 
Register.
    (b) Information. (1) The application shall include a statement of 
the amount of advances repaid and to be repaid during the one-year 
period ending on November 9 of the taxable year for which avoidance is 
requested. If the amount repaid as of the date of the application is 
less than the amount required to satisfy the provisions ofSec. 
606.23(a)(1), the Governor shall provide a report later of the 
additional repayments that have been made in the remainder of the one-
year period ending on November 9 of the taxable year, for the purposes 
of meeting the provisions ofSec. 606.23(a)(1).
    (2) The application also shall include estimates of revenue 
receipts, benefit outlays, and end-of-month fund balance for each month 
in the period beginning with September of the taxable year for which 
avoidance is requested through the subsequent January. Actual data for 
the comparable period of the preceding year also shall be included in 
the application in order to determine the reasonableness of such 
estimates.
    (3) The application also shall include a description of State law 
changes, effective for the taxable year for which the avoidance is 
requested, which resulted in a net increase in the solvency of the State 
unemployment compensation system, and documentation which supports the 
State's estimate of the net increase in solvency for such taxable year.



Sec.  606.25  Waiver of and substitution for additional tax credit
reduction.

    A provision of subsection (c)(2) of section 3302 of FUTA provides 
that, for a State that qualifies, the additional tax credit reduction 
applicable under subparagraph (C), beginning in the fifth consecutive 
year of a balance of outstanding advances, shall be waived and the 
additional tax credit reduction applicable under subparagraph (B) shall 
be substituted. The waiver and substitution are granted if the OWS 
Administrator determines that the State has taken no action, effective 
during the 12-month period ending on September 30 of the year for which 
the waiver and substitution are requested, which has resulted or will 
result in a net decrease in the solvency of the State unemployment 
compensation system as determined for the purposes of Sec.Sec. 
606.20(a)(2) and 606.21(b).



Sec.  606.26  Application for waiver and substitution.

    (a) Application. The Governor of the State shall make application 
addressed to the Secretary of Labor, no later than July 1 of a taxable 
year with respect to which a State requests waiver and substitution. Any 
such application shall contain the supportive data and information 
required bySec. 606.22(b) for the purposes of Sec.Sec. 606.20(a)(2) 
and 606.21(b). The Governor is required to notify the Department on or 
before October 15 of such taxable year of action occurring after the 
date of the initial application and effective prior to October 1 of such 
year that would impact upon the State's application.
    (b) Notification of determination. The OWS Administrator will make a 
determination on the application as of November 10 of the taxable year, 
will notify the applicant and the Secretary of the Treasury of the 
resulting tax credit reduction to be applied, and will cause notice of 
such determination to be published in the Federal Register.



                     Subpart D_Interest on Advances



Sec.  606.30  Interest rates on advances.

    Advances made to States pursuant to title XII of the Social Security 
Act shall be subject to interest payable on the due dates specified in 
Sec.  606.31. \1\ The interest rate for each calendar year

[[Page 45]]

will be 10 percent or, if less, the rate determined by the Secretary of 
the Treasury and announced to the States by the Department.
---------------------------------------------------------------------------

    \1\ (Editorial note: This section will be added at a later date.)

[53 FR 37429, Sept. 26, 1988, as amended at 71 FR 35514, June 21, 2006]



Sec.  606.31  Due dates for payment of interest. [Reserved]



Sec.  606.32  Types of advances subject to interest.

    (a) Payment of interest. Except as otherwise provided in paragraph 
(b) of this section each State shall pay interest on any advance made to 
such State under title XII of the Social Security Act.
    (b) Cash flow loans--(1) Availability of interest-free advances. 
Advances are deemed cash flow loans and shall be free of interest 
provided that:
    (i) The advances are repaid in full prior to October 1 of the 
calendar year in which the advances are made;
    (ii) The State does not receive an additional advance after 
September 30 of the same calendar year in which the advance is made. If 
the State receives an additional advance after September 30 of the same 
calendar year in which earlier advances were made, interest on the fully 
repaid earlier advance(s) is due and payable not later than the day 
following the date of the first such additional advance. The 
administrator of the State agency must notify the Secretary of Labor no 
later than September 10 of the same calendar year of those loans deemed 
to be cash flow loans and not subject to interest. This notification 
must include the date and amount of each loan made beginning January 01 
through September 30 of the same calendar year, and a copy of 
documentation sent to the Secretary of the Treasury requesting loan 
repayment transfer(s) from the State's account in the UTF to the Federal 
unemployment account in the UTF; and
    (iii) The State has met the funding goals described in paragraph 
(b)(2) or (b)(3) of this section.
    (2) Funding goals. This paragraph (b)(2) is applicable to all States 
as of January 1, 2019. A State has met the funding goals requirement if:
    (i) The State, as of December 31 of any of the 5 consecutive 
calendar years preceding the calendar year in which such advances are 
made, had an AHCM of at least 1.00, as determined underSec. 606.3; and
    (ii) The State maintained tax effort as determined under paragraph 
(b)(4) of this section.
    (3) Phasing in funding goals. This paragraph (b)(3) applies for 
calendar years 2014 through 2018. A State has met the funding goals 
requirement if it has satisfied the solvency criterion in paragraph (i), 
and the maintenance of tax effort criteria in paragraph (ii), of this 
Sec.  606.32(b)(3).
    (i) A State has met the solvency criterion if:
    (A) For calendar year 2014, as of December 31 of any of the 5 
consecutively preceding calendar years, the State had an AHCM of at 
least 0.50, as determined underSec. 606.3;
    (B) For calendar year 2015, as of December 31 of any of the 5 
consecutively preceding calendar years, the State had an AHCM of at 
least 0.60, as determined underSec. 606.3;
    (C) For calendar year 2016, as of December 31 of any of the 5 
consecutively preceding calendar years, the State had an AHCM of at 
least 0.70, as determined underSec. 606.3;
    (D) For calendar year 2017, as of December 31 of any of the 5 
consecutively preceding calendar years, the State had an AHCM of at 
least 0.80, as determined underSec. 606.3;
    (E) For calendar year 2018, as of December 31 of any of the 5 
consecutively preceding calendar years, the State had an AHCM of at 
least 0.90, as determined underSec. 606.3;
    (ii) A State has met the maintenance of tax effort criteria if it 
maintained tax effort as determined under paragraph (b)(4) of this 
section.
    (4) Maintenance of tax effort criteria. A State has maintained tax 
effort if, for every year between the last calendar year in which it met 
the solvency criterion in paragraph (b)(2)(i) or (b)(3)(i) of this 
section and the calendar year in which an interest-free advance is 
taken, the State's unemployment tax rate as defined inSec. 606.3 for 
the calendar year is at least--
    (i) 80 percent of the prior year's unemployment tax rate; and

[[Page 46]]

    (ii) 75 percent of the State 5-year average benefit-cost ratio, as 
determined underSec. 606.21(d).

[53 FR 37429, Sept. 26, 1988, as amended at 75 FR 57156, Sept. 17, 2010]



Sec.  606.33  No payment of interest from unemployment fund. [Reserved]



Sec.  606.34  Reports of interest payable. [Reserved]



Sec.  606.35  Order of application for repayments. [Reserved]



                 Subpart E_Relief from Interest Payment



Sec.  606.40  May/September delay.

    Subsection (b)(3)(B) of section 1202 of the Social Security Act 
permits a State to delay payment of interest accrued on advances made 
during the last five months of the Federal fiscal year (May, June, July, 
August, and September) to no later than December 31 of the next 
succeeding calendar year. If the payment is delayed, interest on the 
delayed payment will accrue from the normal due date (i.e., September 
30) and in the same manner as if the interest due on the advance(s) was 
an advance made on such due date. The Governor of a State which has 
decided to delay such interest payment shall notify the Secretary of 
Labor no later than September 1 of the year with respect to which the 
delay is applicable.



Sec.  606.41  High unemployment deferral.

    (a) Applicability. Subsection (b)(3)(C) of section 1202 of the 
Social Security Act permits a State to defer payment of, and extend the 
payment for, 75 percent of interest charges otherwise due prior to 
October 1 of a year if the OWS Administrator determines that high 
unemployment conditions existed in the State.
    (b) High unemployment defined. For purposes of this section, high 
unemployment conditions existed in the State if the State's rate of 
insured unemployment (as determined for purposes of 20 CFR 615.12) under 
the State law with respect to the period consisting of the first six 
months of the preceding calendar year equalled or exceeded 7.5 percent; 
this means that in weeks 1 (that week which includes January 1 of the 
year) through 26 of such preceding calendar year, the rate of insured 
unemployment reported by the State and accepted by the Department under 
20 CFR part 615 must have averaged a percentage equalling or exceeding 
7.5 percent.
    (c) Schedule of deferred payments. The State must pay prior to 
October 1 one-fourth of the interest due, and must pay a minimum of one-
third of the deferred amount prior to October 1 in each of the three 
years following the year in which deferral was granted; at the State's 
option payment of deferred interest may be accelerated.
    (d) Related criteria. Timely payment of one-fourth of the interest 
due prior to October 1 is a precondition to obtaining deferral of 
payment of 75 percent of the interest due. No interest shall accrue on 
such deferred interest.
    (e) Application for deferral and determination. (1) The Governor of 
a State which has decided to request such deferral of interest payment 
shall apply to the Secretary of Labor no later than July 1 of the 
taxable year for which the deferral is requested.
    (2) The OWS Administrator will determine whether deferral is or is 
not granted on the basis of the Department's records of reports of the 
rates of insured unemployment and information obtained from the 
Department of the Treasury as to the timely and full payment of one-
fourth of the interest due.



Sec.  606.42  High unemployment delay.

    (a) Applicability. Paragraph (9) of section 1202 (b) of the Social 
Security Act permits a State to delay for a period not exceeding nine 
months the interest payment due prior to October 1 if, for the most 
recent 12-month period prior to such October 1 for which data are 
available, the State had an average total unemployment rate of 13.5 
percent or greater.
    (b) Delayed due date. An interest payment delayed under paragraph 
(9) must be paid in full not later than the last official Federal 
business day prior to the following July 1; at the State's option 
payment of delayed interest may be accelerated. No interest shall accrue 
on such delayed payment.

[[Page 47]]

    (c) Application for delay in payment and determination. (1) The 
Governor of a State which has decided to request delay in payment of 
interest under paragraph (9) shall apply to the Secretary of Labor no 
later than July 1 of the taxable year for which the delay is requested.
    (2) The OWS Administrator will determine whether delay is or is not 
granted on the basis of seasonally unadjusted civilian total 
unemployment rate data published by the Department's Bureau of Labor 
Statistics.



Sec.  606.44  Notification of determinations.

    The OWS Administrator will make determinations under Sec.Sec. 
606.41, 606.42, and 606.43 on or before September 10 of the taxable 
year, will promptly notify the applicants and the Secretary of the 
Treasury of such determinations, and will cause notice of such 
determinations to be published in the Federal Register. The OWS 
Administrator also will inform the Secretary of the Treasury and cause 
notice to be published in the Federal Register of information with 
respect to delayed payment of interest as provided inSec. 606.40.



PART 609_UNEMPLOYMENT COMPENSATION FOR FEDERAL CIVILIAN EMPLOYEES--
Table of Contents



                      Subpart A_General Provisions

Sec.
609.1 Purpose and application.
609.2 Definitions of terms.

                Subpart B_Administration of UCFE Program

609.3 Eligibility requirements for UCFE.
609.4 Weekly and maximum benefit amounts.
609.5 Claims for UCFE.
609.6 Determinations of entitlement; notices to individual.
609.7 Appeal and review.
609.8 The applicable State for an individual.
609.9 Provisions of State law applicable to UCFE claims.
609.10 Restrictions on entitlement.
609.11 Overpayments; penalties for fraud.
609.12 Inviolate rights to UCFE.
609.13 Recordkeeping; disclosure of information.
609.14 Payments to States.
609.15 Public access to Agreements.
609.16 Administration in absence of an Agreement.
609.17 Information, reports, and studies.

             Subpart C_Responsibilities of Federal Agencies

609.20 Information to Federal civilian employees.
609.21 Findings of Federal agency.
609.22 Correcting Federal findings.
609.23 Furnishing additional information.
609.24 Reconsideration of Federal findings.
609.25 Furnishing other information.
609.26 Liaison with Department.

    Authority: 5 U.S.C. 8508; Secretary's Order No. 4-75, 40 FR 18515; 
(5 U.S.C. 301). Interpret and apply secs. 8501-8508 of title 5, United 
States Code.

    Source: 47 FR 54687, Dec. 3, 1982, unless otherwise noted.



                      Subpart A_General Provisions



Sec.  609.1  Purpose and application.

    (a) Purpose. Subchapter I of chapter 85, title 5 of the United 
States Code, as amended by Pub. L. 94-566, 90 Stat. 2667, 5 U.S.C. 8501-
8508, provides for a permanent program of unemployment compensation for 
unemployed Federal civilian employees. The unemployment compensation 
provided for in subchapter I is hereinafter referred to as unemployment 
compensation for Federal employees, or UCFE. The regulations in this 
part are issued to implement the UCFE Program.
    (b) First rule of construction. The Act and the implementing 
regulations in this part shall be construed liberally so as to carry out 
the purposes of the Act.
    (c) Second rule of construction. The Act and the implementing 
regulations in this part shall be construed so as to assure insofar as 
possible the uniform interpretation and application of the Act 
throughout the United States.
    (d) Effectuating purpose and rules of construction. (1) In order to 
effectuate the provisions of this section, each State agency shall 
forward to the United States Department of Labor (hereafter Department), 
not later than 10 days after issuance, a copy of each judicial or 
administrative decision ruling on an individual's entitlement to payment 
of UCFE or to credit for a waiting period. On request of the Department, 
a State agency shall forward to the Department a copy of any 
determination or redetermination ruling on

[[Page 48]]

an individual's entitlement to UCFE or waiting period credit.
    (2) If the Department believes that a determination, 
redetermination, or decision is inconsistent with the Department's 
interpretation of the Act or this part, the Department may at any time 
notify the State agency of the Department's view. Thereafter the State 
agency shall issue a redetermination or appeal if possible, and shall 
not follow such determination, redetermination, or decision as a 
precedent; and, in any subsequent proceedings which involve such 
determination, redetermination, or decision, or wherein such 
determination, redetermination, or decision is cited as precedent or 
otherwise relied upon, the State agency shall inform the claims deputy 
or hearing officer or court of the Department's view and shall make all 
reasonable efforts, including appeal or other proceedings in an 
appropriate forum, to obtain modification, limitation, or overruling of 
the determination, redetermination, or decision.
    (3) If the Department believes that a determination, 
redetermination, or decision is patently and flagrantly violative of the 
Act or this part, the Department may at any time notify the State agency 
of the Department's view. If the determination, redetermination, or 
decision in question denies UCFE to a claimant, the steps outlined in 
paragraph (d)(2) of this section shall be followed by the State agency. 
If the determination, redetermination, or decision in question awards 
UCFE to a claimant, the benefits are ``due'' within the meaning of 
section 303(a)(1) of the Social Security Act, 42 U.S.C. 503(a)(1), and 
therefore must be paid promptly to the claimant. However, the State 
agency shall take the steps outlined in paragraph (d)(2) of this 
section, and payments to the claimant may be temporarily delayed if 
redetermination or appeal action is taken not more than one business day 
following the day on which the first payment otherwise would be issued 
to the claimant; and the redetermination action is taken or appeal is 
filed to obtain a reversal of the award of UCFE and a ruling consistent 
with the Department's view; and the redetermination action or appeal 
seeks an expedited redetermination or appeal within not more than two 
weeks after the redetermination action is taken or the appeal is filed. 
If redetermination action is not taken or appeal is not filed within the 
above time limit, or a redetermination or decision is not obtained 
within the two-week limit, or any redetermination or decision or order 
is issued which affirms the determination, redetermination, or decision 
awarding UCFE or allows it to stand in whole or in part, the benefits 
awarded must be paid promptly to the claimant.
    (4)(i) If any determination, redetermination, or decision, referred 
to in paragraph (d)(2) or paragraph (d)(3) of this section, is treated 
as a precedent for any future UCFE claim or claim under the UCX Program 
(part 614 of this chapter), the Secretary will decide whether the 
Agreement with the State entered into under the Act shall be terminated.
    (ii) In the case of any determination, redetermination, or decision 
that is not legally warranted under the Act or this part, including any 
determination, redetermination, or decision referred to in paragraph 
(d)(3) of this section, the Secretary will decide whether the State 
shall be required to restore the funds of the United States for any sums 
paid under such a determination, redetermination, or decision, and 
whether, in the absence of such restoration, the Agreement with the 
State shall be terminated and whether other action shall be taken to 
recover such sums for the United States.
    (5) A State agency may request reconsideration of a notice issued 
pursuant to paragraph (d)(2) of paragraph (d)(3) of this section, and 
shall be given an opportunity to present views and arguments if desired.
    (6) Concurrence of the Department in a determination, 
redetermination, or decision shall not be presumed from the absence of a 
notice issued pursuant to this section.



Sec.  609.2  Definitions of terms.

    For the purposes of the Act and this part:
    (a) Act means subchapter I of chapter 85, title 5, United States 
Code, 5 U.S.C. 8501-8508.

[[Page 49]]

    (b) Agreement means the agreement entered into pursuant to the Act 
between a State and the Secretary under which the State agency of the 
State agrees to make payments of unemployment compensation in accordance 
with the Act and the regulations and procedures thereunder prescribed by 
the Department.
    (c) Based period means the base period as defined by the applicable 
State law for the benefit year.
    (d) Benefit year means the benefit year as defined by the applicable 
State law, and if not so defined the term means the period prescribed in 
the agreement with the State or, in the absence of an Agreement, the 
period prescribed by the Department.
    (e) Federal agency means any department, agency, or governmental 
body of the United States, including any instrumentality wholly or 
partially owned by the United States, in any branch of the Government of 
the United States, which employs any individual in Federal civilian 
service.
    (f) Federal civilian service means service performed in the employ 
of any Federal agency, except service performed--
    (1) By an elective official in the executive or legislative branches 
of the Government of the United States;
    (2) As a member of the Armed Forces or the Commissioned Corps of the 
National Oceanic and Atmospheric Administration;
    (3) By Foreign Service personnel for whom special separation 
allowances are provided under chapter 14 of title 22 of the United 
States Code;
    (4) Outside the 50 States, the Commonwealth of Puerto Rico, the 
Virgin Islands, and the District of Columbia, by an individual who is 
not a citizen of the United States;
    (5) By an individual excluded by regulations of the Office of 
Personnel Management from civil service retirement coverage provided by 
subchapter III of chapter 83 of title 5 of the United States Code 
because the individual is paid on a contract or fee basis;
    (6) By an individual receiving nominal pay and allowances of $12 or 
less a year;
    (7) In a hospital, home, or other institution of the United States 
by a patient or inmate thereof;
    (8) By a student-employee as defined by 5 U.S.C. 5351; that is: (i) 
A student nurse, medical or dental intern, resident-in-training, student 
dietitian, student physical therapist, or student occupational 
therapist, assigned or attached to a hospital, clinic, or medical or 
dental laboratory operated by an agency as defined in section 5351; or
    (ii) Any other student-employee, assigned or attached primarily for 
training purposes to such a hospital, clinic, or medical or dental 
laboratory operated by such an agency, who is designated by the head of 
the agency with the approval of the Office of Personnel Management;
    (9) By an individual serving on a temporary basis in case of fire, 
storm, earthquake, flood, or other similar emergency;
    (10) By an individual employed under a Federal relief program to 
relieve the individual from unemployment;
    (11) As a member of a State, county, or community committee under 
the Agricultural Stabilization and Conservation Service or of any other 
board, council, committee, or other similar body, unless such body is 
composed exclusively of individuals otherwise in the full-time employ of 
the United States;
    (12) By an officer or member of the crew on or in connection with an 
American vessel which is:
    (i) Owned by or bareboat chartered to the United States, and
    (ii) The business of which is conducted by a general agent of the 
Secretary of Commerce; and
    (iii) If contributions on account of such service are required under 
section 3305(g) of the Internal Revenue Code of 1986 (26 U.S.C. 3305(g)) 
to be made to an unemployment fund under a State law;
    (13) By an individual excluded by any other Federal law from 
coverage under the UCFE Program; or
    (14) By an individual whose service is covered by the UCX Program to 
which part 614 of this chapter applies.
    (g) Federal employee means an individual who has performed Federal 
civilian service.

[[Page 50]]

    (h) Federal findings means the facts reported by a Federal agency 
pertaining to an individual as to: (1) Whether or not the individual has 
performed Federal civilian service for such an agency;
    (2) The period or periods of such Federal civilian service;
    (3) The individual's Federal wages; and
    (4) The reasons for termination of the individual's Federal civilian 
service.
    (i) Federal wages means all pay and allowances, in cash and in kind, 
for Federal civilian service.
    (j) First claim means an initial claim for unemployment compensation 
under the UCFE Program, the UCX Program (part 614 of this chapter), a 
State law, or some combination thereof, whereby a benefit year is 
established under an applicable State law.
    (k) Official station means the State (or country, if outside the 
United States) designated on a Federal employee's notification of 
personnel action terminating the individual's Federal civilian service 
(Standard Form 50 or its equivalent) as the individual's ``duty 
station.'' If the form of notification does not specify the Federal 
employee's ``duty station'', the individual's official station shall be 
the State or country designated under ``name and location of employing 
office'' on such form or designated as the individual's place of 
employment on an equivalent form.
    (l) Secretary means the Secretary of Labor of the United States.
    (m) State means the 50 States, the District of Columbia, the 
Commonwealth of Puerto Rico, and the Virgin Islands.
    (n) State agency means the agency of the State which administers the 
applicable State law and is administering the UCFE Program in the State 
pursuant to an Agreement with the Secretary.
    (o)(1) State law means the unemployment compensation law of a State 
approved by the Secretary under section 3304 of the Internal Revenue 
Code of 1986, 26 U.S.C. 3304, if the State is certified under section 
3304(c) of the Internal Revenue Code of 1986, 26 U.S.C. 3304(c).
    (2) Applicable State law means the State law made applicable to a 
UCFE claimant bySec. 609.8.
    (p)(1) Unemployment compensation means cash benefits (including 
dependents' allowances) payable to individuals with respect to their 
unemployment, and includes regular, additional, emergency, and extended 
compensation.
    (2) Regular compensation means unemployment compensation payable to 
an individual under any State law, but not including additional 
compensation or extended compensation.
    (3) Additional compensation means unemployment compensation totally 
financed by a State and payable under a State law by reason of 
conditions of high unemployment or by reason of other special factors.
    (4) Emergency compensation means supplementary unemployment 
compensation payable under a temporary Federal law after exhaustion of 
regular and extended compensation.
    (5) Extended compensation means unemployment compensation payable to 
an individual for weeks of unemployment in an extended benefit period, 
under those provisions of a State law which satisfy the requirements of 
the Federal-State Extended Unemployment Compensation Act of 1970, as 
amended, 26 U.S.C. 3304 note, and part 615 of this chapter, with respect 
to the payment of extended compensation.
    (q) Week means, for purposes of eligibility for and payment of UCFE, 
a week as defined in the applicable State law.
    (r) Week of unemployment means a week of total, part-total, or 
partial unemployment as defined in the applicable State law, which shall 
be applied in the same manner and to the same extent to all employment 
and earnings, and in the same manner and to the same extent for the 
purposes of the UCFE Program, as if the individual filing for UCFE were 
filing a claim for State unemployment compensation.

[47 FR 54687, Dec. 3, 1982, as amended at 71 FR 35514, June 21, 2006]

[[Page 51]]



                Subpart B_Administration of UCFE Program



Sec.  609.3  Eligibility requirements for UCFE.

    An individual shall be eligible to receive a payment of UCFE or to 
waiting period credit with respect to a week of unemployment if:
    (a) The individual has Federal civilian service and Federal wages in 
the base period under the applicable State law;
    (b) The individual meets the qualifying employment and wage 
requirements of the applicable State law, either on the basis of Federal 
civilian service and Federal wages alone or in combination with service 
and wages covered under a State law or under the UCX Program (part 614 
of this chapter);
    (c) The individual has filed an initial claim for UCFE and, as 
appropriate, has filed a timely claim for waiting period credit or a 
payment of UCFE with respect to that week of unemployment; and
    (d) The individual is totally, part-totally, or partially 
unemployed, and is able to work, available for work, and seeking work 
within the meaning of or as required by the applicable State law, and is 
not subject to disqualification under this part or the applicable State 
law, with respect to that week of unemployment.



Sec.  609.4  Weekly and maximum benefit amounts.

    (a) Total unemployment. The weekly amount of UCFE payable to an 
eligible individual for a week of total unemployment shall be the amount 
that would be payable to the individual as unemployment compensation for 
a week of total unemployment as determined under the applicable State 
law.
    (b) Partial and part-total unemployment. The weekly amount of UCFE 
payable for a week of partial or part-total unemployment shall be the 
amount that would be payable to the individual as unemployment 
compensation for a week of partial or part-total unemployment as 
determined under the applicable State law.
    (c) Maximum amount. The maximum amount of UCFE which shall be 
payable to an eligible individual during and subsequent to the 
individual's benefit year shall be the maximum amount of all 
unemployment compensation that would be payable to the individual as 
determined under the applicable State law.
    (d) Computation rules. (1) The weekly and maximum amounts of UCFE 
payable to an individual under the UCFE Program shall be determined 
under the applicable State law to be in the same amount, on the same 
terms, and subject to the same conditions as the State unemployment 
compensation which would be payable to the individual under the 
applicable State law if the individual's Federal civilian service and 
Federal wages assigned or transferred under this part to the State had 
been included as employment and wages covered by that State law.
    (2) All Federal civilian service and Federal wages for all Federal 
agencies shall be considered employment with a single employer for 
purposes of the UCFE Program.



Sec.  609.5  Claims for UCFE.

    (a) First claims. A first claim for UCFE shall be filed by an 
individual in any State agency of any State (or Canada) according to the 
applicable State law, and on a form prescribed by the Department which 
shall be furnished to the individual by the State agency where the claim 
is filed.
    (b) Weekly claims. Claims for waiting week credit and payments of 
UCFE for weeks of unemployment shall be filed in any State agency (or 
Canada) at the times and in the manner as claims for State unemployment 
compensation are filed under the applicable State law, and on forms 
prescribed by the Department which shall be furnished to the individual 
by the State agency where the claim is filed.
    (c) Secretary's standard. The procedure for reporting and filing 
claims for UCFE and waiting period credit shall be consistent with this 
part 609 and the Secretary's ``Standard for Claim Filing, Claimant 
Reporting, Job Finding and Employment Services'' (Employment Security 
Manual, part V, sections 5000 et seq.).

[[Page 52]]



Sec.  609.6  Determinations of entitlement; notices to individual.

    (a) Determination of first claim. The State agency whose State law 
applies to an individual underSec. 609.8 shall, promptly upon the 
filing of a first claim for UCFE, determine whether the individual is 
eligible and whether a disqualification applies, and, if the individual 
is found to be eligible, the individual's benefit year and the weekly 
and maximum amounts of UCFE payable to the individual.
    (b) Determinations of weekly claims. The State agency promptly 
shall, upon the filing of a claim for payment of UCFE or waiting period 
credit with respect to a week, determine whether the individual is 
entitled to a payment of UCFE or waiting period credit with respect to 
such week, and, if entitled, the amount of UCFE or waiting period credit 
to which the individual is entitled.
    (c) Redetermination. The provisions of the applicable State law 
concerning the right to request, or authority to undertake, 
reconsideration of a determination pertaining to State unemployment 
compensation under the applicable State law shall apply to 
determinations pertaining to UCFE.
    (d) Notices to individual. The State agency promptly shall give 
notice in writing to the individual of any determination or 
redetermination of a first claim, and, except as may be authorized under 
paragraph (g) of this section, of any determination or redetermination 
of any weekly claim which denies UCFE or waiting period credit or 
reduces the weekly amount or maximum amount initially determined to be 
payable. Each notice of determination or redetermination shall include 
such information regarding the determination or redetermination and 
notice of right to reconsideration or appeal, or both, as is furnished 
with written notices of determinations and redeterminations with respect 
to claims for State unemployment compensation; and where information 
furnished by a Federal agency was considered in making the 
determination, or redetermination, the notice thereof shall include an 
explanation of the right of the individual to seek additional 
information pursuant toSec. 609.23 and/or a reconsideration of Federal 
findings pursuant toSec. 609.24.
    (e) Obtaining information for claim determinations. (1) Information 
required for the determination of claims for UCFE shall be obtained by 
the State agency from claimants, employers, and others, in the same 
manner as information is obtained for claim purposes under the 
applicable State law, but information (including additional and 
reconsidered Federal findings) shall be obtained from the Federal agency 
that employed the UCFE claimant as prescribed in Sec.Sec. 609.21 
through 609.25. On request by a UCFE claimant, the State agency shall 
seek additional information pursuant toSec. 609.23 and reconsideration 
of Federal findings pursuant toSec. 609.24.
    (2) If Federal findings have not been received from a Federal agency 
within 12 days after the request for information was submitted to the 
Federal agency, the State agency shall determine the individual's 
entitlement to UCFE on the basis of an affidavit completed by the 
individual on a form prescribed by the Department. In addition, the 
individual shall submit for examination by the State agency any 
documents issued by the Federal agency (for example, Standard Form 50 or 
W-2) verifying that the individual performed services for and received 
wages from such Federal agency.
    (3) If Federal findings received by a State agency after a 
determination has been made under this section contain information which 
would result in a change in the individual's eligibility for or 
entitlement to UCFE, the State agency promptly shall make a 
redetermination and notify the individual, as provided in this section. 
All payments of UCFE made prior to or after such redetermination shall 
be adjusted in accordance therewith.
    (f) Promptness. Full payment of UCFE when due shall be consistent 
with this part 609 and shall be made with the greatest promptness that 
is administratively feasible, but the provisions of part 640 of this 
chapter (relating to promptness of benefit payments) shall not be 
applicable to the UCFE Program.
    (g) Secretary's standard. The procedures for making determinations 
and

[[Page 53]]

redeterminations, and furnishing written notices of determinations, 
redeterminations, and rights of appeal to individuals applying for UCFE, 
shall be consistent with this part 609 and with the Secretary's 
``Standard for Claim Determinations--Separation Information'' 
(Employment Security Manual, part V, sections 6010 et seq.).

[47 FR 54687, Dec. 3, 1982, as amended at 71 FR 35514, June 21, 2006]



Sec.  609.7  Appeal and review.

    (a) Applicable State law. The provisions of the applicable State law 
concerning the right of appeal and fair hearing from a determination or 
redetermination of entitlement to State unemployment compensation shall 
apply to determinations and redeterminations of eligibility for or 
entitlement to UCFE and waiting period credit. Any such determination or 
redetermination shall be subject to appeal and review only in the manner 
and to the extent provided in the applicable State law with respect to 
determinations and redeterminations of entitlement to State unemployment 
compensation.
    (b) Rights of appeal and fair hearing. The provisions on right to 
appeal and opportunity for a fair hearing with respect to claims for 
UCFE shall be consistent with this part and with sections 303(a)(1) and 
303(a)(3) of the Social Security Act, 42 U.S.C. 503(a)(1) and 503(a)(3).
    (c) Promptness on appeals. (1) Decisions on appeals under the UCFE 
Program shall accord with the Secretary's ``Standard for Appeals 
Promptness--Unemployment Compensation'' in part 650 of this chapter, and 
withSec. 609.1(d).
    (2) Any provision of an applicable State law for advancement or 
priority of unemployment compensation cases on judicial calendars, or 
otherwise intended to provide for the prompt payment of unemployment 
compensation when due, shall apply to proceedings involving claims for 
UCFE.
    (d) Appeal and review by Federal agency. If a Federal agency 
believes that a State agency's determination or redetermination of an 
individual's eligibility for or entitlement to UCFE is incorrect, the 
Federal agency may seek appeal and review of such determination or 
redetermination in the same manner as an interested employer may seek 
appeal and review under the applicable State law.

[47 FR 54687, Dec. 3, 1982, as amended at 71 FR 35514, June 21, 2006]



Sec.  609.8  The applicable State for an individual.

    (a) The applicable State. The applicable State for an individual 
shall be the State to which the individual's Federal civilian service 
and Federal wages are assigned or transferred under this section. The 
applicable State law for the individual shall be the State law of such 
State.
    (b) Assignment of service and wages. (1) An individual's Federal 
civilian service and Federal wages shall be assigned to the State in 
which the individual had his or her last official station prior to 
filing a first claim unless:
    (i) At the time a first claim is filed the individual resides in 
another State in which, after separation from Federal civilian service, 
the individual performed service covered under the State law, in which 
case all of the individual's Federal civilian service and wages shall be 
assigned to the latter State; or
    (ii) Prior to filing a first claim an individual's last official 
station was outside the States, in which case all of the individual's 
Federal civilian service and Federal wages shall be assigned to the 
State in which the individual resides at the time the individual files a 
first claim, provided the individual is personally present in a State 
when the individual files the first claim.
    (2) Federal civilian service and wages assigned to a State in error 
shall be reassigned for use by the proper State agency. An appropriate 
record of a reassignment shall be made by the State agency which makes 
the reassignment.
    (3) Federal civilian service and Federal wages assigned to a State 
shall be transferred to another State where such transfer is necessary 
for the purposes of a combined-wage claim filed by an individual.
    (c) Assignment deemed complete. All of an individual's Federal 
civilian service and Federal wages shall be deemed to have been assigned 
to a State upon the filing of a first claim. Federal civilian

[[Page 54]]

service and Federal wages shall be assigned to a State only in 
accordance with paragraph (b) of this section.
    (d) Use of assigned service and wages. All assigned Federal civilian 
service and Federal wages shall be used only by the State to which 
assigned or transferred in accordance with paragraph (b) of this 
section.



Sec.  609.9  Provisions of State law applicable to UCFE claims.

    (a) Particular provisions applicable. Except where the result would 
be inconsistent with the provisions of the Act or this part or the 
procedures thereunder prescribed by the Department, the terms and 
conditions of the applicable State law which apply to claims for, and 
the payment of, State unemployment compensation shall apply to claims 
for, and the payment of, UCFE and claims for waiting period credit. The 
provisions of the applicable State law which shall apply include, but 
are not limited to:
    (1) Claim filing and reporting;
    (2) Information to individuals, as appropriate;
    (3) Notices to individuals and Federal agencies, as appropriate, 
including notice to each individual of each determination and 
redetermination of eligibility for or entitlement to UCFE;
    (4) Determinations and redeterminations;
    (5) Ability to work, availability for work, and search for work; and
    (6) Disqualifications.
    (b) IBPP. The Interstate Benefit Payment Plan shall apply, where 
appropriate, to individuals filing claims for UCFE.
    (c) Wage combining. The State's provisions complying with the 
Interstate Arrangement for Combining Employment and Wages (part 616 of 
this chapter) shall apply, where appropriate, to individuals filing 
claims for UCFE.
    (d) Procedural requirements. The provisions of the applicable State 
law which apply hereunder to claims for and the payment of UCFE shall be 
applied consistently with the requirements of title III of the Social 
Security Act and the Federal Unemployment Tax Act which are pertinent in 
the case of State unemployment compensation, including but not limited 
to those standards and requirements specifically referred to in the 
provisions of this part, except as provided in paragraph (f) ofSec. 
609.6.



Sec.  609.10  Restrictions on entitlement.

    (a) Disqualification. If the week of unemployment for which an 
individual claims UCFE is a week to which a disqualification for State 
unemployment compensation applies under the applicable State law, or 
would apply but for the fact that the individual has no right to such 
compensation, the individual shall not be entitled to a payment of UCFE 
for that week.
    (b) Allocation of terminal annual leave payments. Lump-sum terminal 
annual leave payments shall not be allocated by a Federal agency and 
shall be allocated by a State agency in the same manner as similar 
payments to individuals employed by private employers are allocated 
under the applicable State law. In a State in which a private employer 
has an option as to the period to which such payments shall be 
allocated, such payments shall be allocated to the date of separation 
from employment.



Sec.  609.11  Overpayments; penalties for fraud.

    (a) False statements and representations. Section 8507(a) of the Act 
provides that if a State agency, the Department, or a court of competent 
jurisdiction finds that an individual--
    (1) Knowingly has made, or caused to be made by another, a false 
statement or representation of a material fact, or knowingly has failed, 
or caused another to fail, to disclose a material fact; and
    (2) As a result of that action has received an amount as UCFE to 
which the individual was not entitled; the individual shall repay the 
amount to the State agency or the Department. Instead of requiring 
repayments, the State agency or the Department may recover the amount by 
deductions from UCFE payable to the individual during the 2-year period 
after the date of the finding. A finding by a State agency or the 
Department may be made only after an opportunity for a fair hearing, 
subject to such further review as may be appropriate underSec. 609.7.

[[Page 55]]

    (b) Prosecution for fraud. Section 1919 of title 18, United States 
Code, provides that whoever makes a false statement or representation of 
a material fact knowing it to be false, or knowingly fails to disclose a 
material fact, to obtain or increase for himself or for any other 
individual any payment authorized to be paid under chapter 85 of title 
5, United States Code, or under an agreement thereunder, shall be fined 
not more than $1,000 or imprisoned not more than one year, or both.
    (c) Absence of fraud. If a State agency or court of competent 
jurisdiction finds that an individual has received a payment of UCFE to 
which the individual was not entitled under the Act and this part, which 
was not due to a false statement or representation as provided in 
paragraph (a) or (b) of this section, the individual shall be liable to 
repay to the applicable State the total sum of the payment to which the 
individual was not entitled, and the State agency shall take all 
reasonable measures authorized under any State law or Federal law to 
recover for the account of the United States the total sum of the 
payment to which the individual was not entitled.
    (d) Recovery by offset. (1) The State agency shall recover, insofar 
as is possible, the amount of any overpayment which is not repaid by the 
individual, by deductions from any UCFE payable to the individual under 
the Act and this part, or from any unemployment compensation payable to 
the individual under any Federal unemployment compensation law 
administered by the State agency, or from any assistance or allowance 
payable to the individual with respect to unemployment under any other 
Federal law administered by the State agency.
    (2) A State agency shall also recover, insofar as is possible, the 
amount of any overpayment of UCFE made to the individual by another 
State, by deductions from any UCFE payable by the State agency to the 
individual under the Act and this part, or from any unemployment 
compensation payable to the individual under any Federal unemployment 
compensation law administered by the State agency, or from any 
assistance or allowance payable to the individual with respect to 
unemployment under any other Federal law administered by the State 
agency.
    (3) Recoupment of fraudulent overpayments referred to in paragraph 
(a) of this section shall be limited to the 2-year period stated in that 
paragraph. Recoupment of fraudulent overpayments referred to in 
paragraph (b) of this section, and nonfraudulent overpayments referred 
to in paragraph (c) of this section shall be subject to any time 
limitation on recoupment provided for in the State law that applies to 
the case.
    (e) Debts due the United States. UCFE payable to an individual shall 
be applied by the State agency for the recovery by offset of any debt 
due to the United States from the individual, but shall not be applied 
or used by the State agency in any manner for the payment of any debt of 
the individual to any State or any other entity or person except 
pursuant to a court order for child support or alimony in accordance 
with the law of the State and section 459 of the Social Security Act, 42 
U.S.C. 659.
    (f) Application of State law. (1) Except as indicated in paragraph 
(a) of this section, any provision of State law that may be applied for 
the recovery of overpayments or prosecution for fraud, and any provision 
of State law authorizing waiver of recovery of overpayments of 
unemployment compensation, shall be applicable to UCFE.
    (2) In the case of any finding of false statement or representation 
under the Act and paragraph (a) of this section, or prosecution for 
fraud under 18 U.S.C. 1919 or pursuant to paragraph (f)(1) of this 
section, the individual shall be disqualified or penalized in accordance 
with the provisions of the applicable State law relating to fraud in 
connection with a claim for State unemployment compensation.
    (g) Final decision. Recovery of any overpayment of UCFE shall not be 
enforced by the State agency until the determination or redetermination 
establishing the overpayment has become final, or if appeal is taken 
from the determination or redetermination, until the decision after 
opportunity for a fair hearing has become final.
    (h) Procedural requirements. (1) The provisions of paragraphs (c), 
(d), and (g)

[[Page 56]]

ofSec. 609.6 shall apply to determinations and redeterminations made 
pursuant to this section.
    (2) The provisions ofSec. 609.7 shall apply to determinations and 
redeterminations made pursuant to this section.
    (i) Fraud detection and prevention. Provisions in the procedures of 
each State with respect to detection and prevention of fraudulent 
overpayments of UCFE shall be, as a minimum, commensurate with the 
procedures adopted by the State with respect to State unemployment 
compensation and consistent with the Secretary's ``Standard for Fraud 
and Overpayment Detection'' (Employment Security Manual, part V, section 
7510 et seq.).
    (j) Recovered overpayments. An amount repaid or recouped under this 
section shall be--
    (1) Deposited in the fund from which payment was made, if the 
repayment was to a State agency; or
    (2) Returned to the Treasury of the United States and credited to 
the current applicable appropriation, fund, or account from which 
payment was made, if the repayment was to the Department.



Sec.  609.12  Inviolate rights to UCFE.

    Except as specifically provided in this part, the rights of 
individuals to UCFE shall be protected in the same manner and to the 
same extent as the rights of persons to State unemployment compensation 
are protected under the applicable State law. Such measures shall 
include protection of applicants for UCFE from waiver, release, 
assignment, pledge, encumbrance, levy, execution, attachment, and 
garnishment of their rights to UCFE, except as provided inSec. 609.11. 
In the same manner and to the same extent, individuals shall be 
protected from discrimination and obstruction in regard to seeking, 
applying for, and receiving any right to UCFE.



Sec.  609.13  Recordkeeping; disclosure of information.

    (a) Recordkeeping. Each State agency will make and maintain records 
pertaining to the administration of the UCFE Program as the Department 
requires, and will make all such records available for inspection, 
examination, and audit by such Federal officials or employees as the 
Department may designate or as may be required by law.
    (b) Disclosure of Information. Information in records maintained by 
a State agency in administering the UCFE Program shall be kept 
confidential, and information in such records may be disclosed only in 
the same manner and to the same extent as information with respect to 
State unemployment compensation and the entitlement of individuals 
thereto may be disclosed under the applicable State law. This provision 
on the confidentiality of information maintained in the administration 
of the UCFE Program shall not apply, however, to the Department or for 
the purposes of Sec.Sec. 609.11 or 609.13, or in the case of 
information, reports and studies required pursuant to Sec.Sec. 609.17 
or 609.25, or where the result would be inconsistent with the Freedom of 
Information Act (5 U.S.C. 552), the Privacy Act of 1974, as amended (5 
U.S.C. 552a), or regulations of the Department promulgated thereunder.

[47 FR 54687, Dec. 3, 1982, as amended at 71 FR 35514, June 21, 2006]



Sec.  609.14  Payments to States.

    (a) State entitlement. Each State is entitled to be paid by the 
United States with respect to each individual whose base period wages 
included Federal wages, an amount bearing the same ratio to the total 
amount of compensation paid to such individual as the amount of the 
individual's Federal wages in the individual's base period bears to the 
total amount of the individual's base period wages.
    (b) Payment. Each State shall be paid, either in advance or by way 
of reimbursement, as may be determined by the Department, the sum that 
the Department estimates the State is entitled to receive under the Act 
and this part for each calendar month. The sum shall be reduced or 
increased by the amount which the Department finds that its estimate for 
an earlier calendar month was greater or less than the sum which should 
have been paid to the State. An estimate may be made on the basis of a 
statistical, sampling, or other method agreed on by the Department and 
the State agency.

[[Page 57]]

    (c) Certification by the Department. The Department, from time to 
time, shall certify to the Secretary of the Treasury the sum payable to 
each State under this section. The Secretary of the Treasury, before 
audit or settlement by the General Accounting Office, shall pay the 
State in accordance with the certification from the funds for carrying 
out the purposes of the Act and this part.
    (d) Use of money. Money paid a State under the Act and this part may 
be used solely for the purposes for which it is paid. Money so paid 
which is not used solely for these purposes shall be returned, at the 
time specified by the Agreement, to the Treasury of the United States 
and credited to the current applicable appropriation, fund, or account 
from which payments to states under the Act and this part may be made.



Sec.  609.15  Public access to Agreements.

    The State agency of a State will make available to any individual or 
organization a true copy of the Agreement with the State for inspection 
and copying. Copies of an Agreement may be furnished on request to any 
individual or organization upon payment of the same charges, if any, as 
apply to the furnishing of copies of other records of the State agency.



Sec.  609.16  Administration in absence of an Agreement.

    (a) Administering Program. The Department shall administer the UCFE 
Program through personnel of the Department or through other 
arrangements under procedures prescribed by the Department, in the case 
of any State which does not have an Agreement with the Secretary as 
provided for in 5 U.S.C. 8502. The procedures prescribed by the 
Department under this section shall be consistent with the Act and this 
part.
    (b) Applicable State law. On the filing by an individual of a claim 
for UCFE in accordance with arrangements under this section, UCFE shall 
be paid to the individual, if eligible, in the same amount, on the same 
terms, and subject to the same conditions as would be paid to the 
individual under the applicable State law if the individual's Federal 
civilian service and Federal wages had been included as employment and 
wages under the State law. Any such claim shall include the individual's 
Federal civilian service and Federal wages, combined with any service 
and wages covered by State law. However, if the individual, without 
regard to his or her Federal civilian service and Federal wages, has 
employment or wages sufficient to qualify for compensation during the 
benefit year under that State law, then payments of UCFE under this 
section may be made only on the basis of the individual's Federal 
civilian service and Federal wages.
    (c) Fair hearing. An individual whose claim for UCFE is denied under 
this section is entitled to a fair hearing under rules of procedure 
prescribed by the Department. A final determination by the Department 
with respect to entitlement to UCFE under this section is subject to 
review by the courts in the same manner and to the same extent as is 
provided by section 205(g) of the Social Security Act, 42 U.S.C. 405(g).



Sec.  609.17  Information, reports, and studies.

    State agencies shall furnish to the Department such information and 
reports and conduct such studies as the Department determines are 
necessary or appropriate for carrying out the purposes of the UCFE 
Program.



             Subpart C_Responsibilities of Federal Agencies



Sec.  609.20  Information to Federal civilian employees.

    Each Federal agency shall:
    (a) Furnish information to its employees as to their rights and 
responsibilities under the UCFE Program and 18 U.S.C. 1919; and
    (b) Furnish a completed copy of a form approved by the Department, 
``Notice to Federal Employee About Unemployment Compensation,'' in 
accordance with instructions thereon, to each employee at the time of 
separation from Federal civilian service, when transferred from one 
payroll office to another, or when the office responsible for 
distribution of the form is advised that an individual is in nonpay

[[Page 58]]

status for seven consecutive days or more.



Sec.  609.21  Findings of Federal agency.

    (a) Answering request. Within four workdays after receipt from a 
State agency of a request for Federal findings on a form furnished by 
the State agency, and prescribed by the Department, a Federal agency 
shall make such Federal findings, complete all copies of the form, and 
transmit the completed copies to the State agency. If documents 
necessary for completion of the form have been assigned to an agency 
records center or the Federal Records Center in St. Louis, the Federal 
agency shall obtain the necessary information from the records center. 
Any records center shall give priority to such a request.
    (b) Failure to meet time limit. If a completed form containing the 
Federal agency's findings cannot be returned within four workdays of 
receipt, the Federal agency immediately shall inform the State agency, 
and shall include an estimated date by which the completed form will be 
returned.
    (c) Administrative control. Each Federal agency shall maintain a 
control of all requests for Federal findings received by it, and the 
Federal agency's response to each request. The records shall be 
maintained so as to enable the Federal agency to ascertain at any time 
the number of such forms that have not been returned to State agencies, 
and the dates of the Federal agency's receipt of such unreturned forms.



Sec.  609.22  Correcting Federal findings.

    If a Federal agency ascertains at any time within one year after it 
has returned a completed form reporting its findings, that any of its 
findings were erroneous, it shall promptly correct its error and forward 
its corrected findings to the State agency.



Sec.  609.23  Furnishing additional information.

    On receipt of a request for additional information from a State 
agency, a Federal agency shall consider the information it supplied 
initially in connection with such request and shall review its findings. 
The Federal agency promptly shall forward to the State agency such 
additional findings as will respond to the request. The Federal agency 
shall, if possible, respond within four workdays after the receipt of a 
request under this section.



Sec.  609.24  Reconsideration of Federal findings.

    On receipt of a request for reconsideration of Federal findings from 
a State agency, the Federal agency shall consider the initial 
information supplied in connection with such request and shall review 
its findings. The Federal agency shall correct any errors or omissions 
in its findings and shall affirm, modify, or reverse any or all of its 
findings in writing. The Federal agency promptly shall forward its 
reconsidered findings to the requesting authority. The Federal agency 
shall, if possible, respond within four workdays after the receipt of a 
request under this section.



Sec.  609.25  Furnishing other information.

    (a) Additional Information. In addition to the information required 
by Sec.Sec. 609.21, 609.22, 609.23, and 609.24, a Federal agency shall 
furnish to a State agency or the Department, within the time requested, 
any information which it is not otherwise prohibited from releasing by 
law, which the Department determines is necessary for the administration 
of the UCFE Program.
    (b) Reports. Federal agencies shall furnish to the Department or 
State agencies such reports containing such information as the 
Department determines are necessary or appropriate for carrying out the 
purposes of the UCFE Program.



Sec.  609.26  Liaison with Department.

    To facilitate the Department's administration of the UCFE Program, 
each Federal agency shall designate one or more of its officials to be 
the liaison with the Department. Each Federal agency will inform the 
Department of its designation(s) and of any change in a designation.

[[Page 59]]



PART 614_UNEMPLOYMENT COMPENSATION FOR EX-SERVICEMEMBERS--
Table of Contents



                      Subpart A_General Provisions

Sec.
614.1 Purpose and application.
614.2 Definitions of terms.

                 Subpart B_Administration of UCX Program

614.3 Eligibility requirements for UCX.
614.4 Weekly and maximum benefit amounts.
614.5 Claims for UCX.
614.6 Determinations of entitlement; notices to individual and Federal 
          military agency.
614.7 Appeal and review.
614.8 The applicable State for an individual.
614.9 Provisions of State law applicable to UCX claims.
614.10 Restrictions on entitlement.
614.11 Overpayments; penalties for fraud.
614.12 Schedules of remuneration.
614.13 Inviolate rights to UCX.
614.14 Recordkeeping; disclosure of information.
614.15 Payments to States.
614.16 Public access to Agreements.
614.17 Administration in absence of an Agreement.
614.18 Information, reports, and studies.

   Subpart C_Responsibilities of Federal Military Agencies and State 
                                Agencies

614.20 Information to ex-servicemembers.
614.21 Findings of Federal military agency.
614.22 Correcting Federal findings.
614.23 Finality of findings.
614.24 Furnishing other information.
614.25 Liaison with Department

Appendix A to Part 614--Standard for Claim Filing, Claimant Reporting, 
          Job Finding, and Employment Services
Appendix B to Part 614--Standard for Claim Determination--Separation 
          Information
Appendix C to Part 614--Standard for Fraud and Overpayment Detection

    Authority: 5 U.S.C. 8508; Secretary's Order No. 4-75 (40 FR 18515).

    Source: 47 FR 54697, Dec. 3, 1982, unless otherwise noted.



                      Subpart A_General Provisions



Sec.  614.1  Purpose and application.

    (a) Purpose. Subchapter II of chapter 85, title 5 of the United 
States Code (5 U.S.C. 8521-8525) provides for a permanent program of 
unemployment compensation for unemployed individuals separated from the 
Armed Forces. The unemployment compensation provided for in subchapter 
II is hereinafter referred to as Unemployment Compensation for Ex-
servicemembers, or UCX. The regulations in this part are issued to 
implement the UCX Program.
    (b) First rule of construction. The Act and the implementing 
regulations in this part shall be construed liberally so as to carry out 
the purposes of the Act.
    (c) Second rule of construction. The Act and the implementing 
regulations in this part shall be construed so as to assure insofar as 
possible the uniform interpretation and application of the Act 
throughout the United States.
    (d) Effectuating purpose and rules of construction. (1) In order to 
effectuate the provisions of this section, each State agency shall 
forward to the United States Department of Labor (hereafter Department), 
not later than 10 days after issuance, a copy of each judicial or 
administrative decision ruling on an individual's entitlement to payment 
of UCX or to credit for a waiting period. On request of the Department, 
a State agency shall forward to the Department a copy of any 
determination or redetermination ruling on an individual's entitlement 
to UCX or waiting period credit.
    (2)(i) If the Department believes that a determination, 
redetermination, or decision is inconsistent with the Department's 
interpretation of the Act or this part, the Department may at any time 
notify the State agency of the Department's view. Thereafter, the State 
agency shall issue a redetermination or appeal if possible, and shall 
not follow such determination, redetermination, or decision as a 
precedent; and, in any subsequent proceedings which involve such 
determination, redetermination, or decision, or wherein such 
determination, redetermination, or decision is cited as precedent or 
otherwise relied upon, the State agency shall inform the claims deputy 
or hearing officer or court of the Department's view and shall make all 
reasonable efforts, including appeal or other proceedings in an 
appropriate forum, to obtain modification, limitation, or overruling of 
the determination, redetermination, or decision.

[[Page 60]]

    (ii) If the Department believes that a State agency has failed to 
use, or use in a timely manner, the crossmatch mechanism at the claims 
control center designated by the Department, the Department may at any 
time notify the State of the Department's view. Thereafter, the State 
agency shall take action to ensure that operable procedures for the 
effective utilization of the claims control center are in place and 
adhered to. In any case of any determination, redetermination, or 
decision that is not legally warranted under the Act or this part had 
the State used, or used in a timely manner, the crossmatch mechanism at 
the claims control center designated by the Department, State agency 
shall take the steps outlined in paragraph (d)(2)(i) of this section.
    (3) If the Department believes that a determination, 
redetermination, or decision is patently and flagrantly violative of the 
Act or this part, the Department may at any time notify the State agency 
of the Department's view. If the determination, redetermination, or 
decision in question denies UCX to a claimant, the steps outlined in 
paragraph (2) above shall be followed by the State agency. If the 
determination, redetermination, or decision in question awards UCX to a 
claimant, the benefits are ``due'' within the meaning of section 
303(a)(1) of the Social Security Act, 42 U.S.C. 503(a)(1), and therefore 
must be paid promptly to the claimant. However, the State agency shall 
take the steps outlined in paragraph (d)(2) of this section, and 
payments to the claimant may be temporarily delayed if redetermination 
or appeal action is taken not more than one business day following the 
day on which the first payment otherwise would be issued to the 
claimant; and the redetermination action is taken or appeal is filed to 
obtain a reversal of the award of UCX and a ruling consistent with the 
Department's view; and the redetermination action or appeal seeks an 
expedited redetermination or appeal within not more than two weeks after 
the redetermination action is taken or the appeal is filed. If 
redetermination action is not taken or appeal is not filed within the 
above time limit, or a redetermination or decision is not obtained 
within the two-week limit, or any redetermination or decision or order 
is issued which affirms the determination, redetermination, or decision 
awarding UCX or allows it to stand in whole or in part, the benefits 
awarded must be paid promptly to the claimant.
    (4)(i) If any determination, redetermination, or decision, referred 
to in paragraph (d)(2) or paragraph (d)(3) of this section, is treated 
as a precedent for any future UCX claim or claim under the UCFE Program 
(part 609 of this chapter), the Secretary will decide whether the 
Agreement with the State entered into under the Act shall be terminated.
    (ii) In the case of any determination, redetermination, or decision 
that is not legally warranted under the Act or this part, including any 
determination, redetermination, or decision referred to in paragraph 
(d)(2) or in paragraph (d)(3) of this section, the Secretary will decide 
whether the State shall be required to restore the funds of the United 
States for any sums paid under such a determination, redetermination, or 
decision, and whether, in absence of such restoration, the Agreement 
with the State shall be terminated and whether other action shall be 
taken to recover such sums for the United States.
    (5) A State agency may request reconsideration of a notice issued 
pursuant to paragraph (d)(2) or paragraph (d)(3) of this section, and 
shall be given an opportunity to present views and arguments if desired.
    (6) Concurrence of the Department in a determination, 
redetermination, or decision shall not be presumed from the absence of a 
notice issued pursuant to this section.

(Approved by the Office of Management and Budget under control number 
1205-0163)

[47 FR 54697, Dec. 3, 1982, as amended at 53 FR 40553, Oct. 17, 1988; 53 
FR 43799, Oct. 26, 1988; 57 FR 59799, Dec. 15, 1992]



Sec.  614.2  Definitions of terms.

    For purposes of the Act and this part:
    (a) Act means subchapter II of chapter 85 of title 5 of the United 
States Code, 5 U.S.C. 8521-8525.
    (b) Agreement means the Agreement entered into pursuant to 5 U.S.C. 
8502 between a State and the Secretary

[[Page 61]]

under which the State agency of the State agrees to make payments of 
unemployment compensation in accordance with the Act and the regulations 
and procedures thereunder prescribed by the Department.
    (c) Base period means the base period as defined by the applicable 
State law for the benefit year.
    (d) Benefit year means the benefit year as defined by the applicable 
State law, and if not so defined the term means the period prescribed in 
the Agreement with the State or, in the absence of an Agreement, the 
period prescribed by the Department.
    (e) Ex-servicemember means an individual who has performed Federal 
military service.
    (f) Federal military agency means any of the Armed Forces of the 
United States, including the Army, Air Force, Navy, Marine Corps, and 
Coast Guard, and the National Oceanic and Atmospheric Administration 
(Department of Commerce).
    (g) Federal military service means active service (not including 
active duty in a reserve status unless for a continuous period of 90 
days or more) in the Armed Forces or the Commissioned Corps of the 
National Oceanic and Atmospheric Administration if with respect to that 
service--
    (1) The individual was discharged or released under honorable 
conditions (and, if an officer, did not resign for the good of the 
service); and
    (2)(i) The individual was discharged or released after completing 
his/her first full term of active service which the individual initially 
agreed to serve, or
    (ii) The individual was discharged or released before completing 
such term of active service--
    (A) For the convenience of the Government under an early release 
program,
    (B) Because of medical disqualification, pregnancy, parenthood, or 
any service-incurred injury or disability,
    (C) Because of hardship, or
    (D) Because of personality disorders or inaptitude but only if the 
service was continuous for 365 days or more.
    (h) Federal military wages means all pay and allowances in cash and 
in kind for Federal military service, computed on the basis of the pay 
and allowances for the pay grade of the individual at the time of his or 
her latest discharge or release from Federal/military service, as 
determined in accordance with the Schedule of Remuneration applicable at 
the time the individual files his or her first claim for compensation 
for a benefit year.
    (i) First claim means an initial claim for unemployment compensation 
under the UCX Program, the UCFE Program (part 609 of this chapter), or a 
State law, or some combination thereof, first filed by an individual 
after the individual's latest discharge or release from Federal military 
service, whereby a benefit year is established under an applicable State 
law.
    (j) Military document means an official document or documents issued 
to an individual by a Federal military agency relating to the 
individual's Federal military service and discharge or release from such 
service.
    (k) Period of active service means a period of continuous active 
duty (including active duty for training purposes) in a Federal military 
agency or agencies, beginning with the date of entry upon active duty 
and ending on the effective date of the first discharge or release 
thereafter which is not qualified or conditional.
    (l) Schedule of Remuneration means the schedule issued by the 
Department from time to time under 5 U.S.C. 8521(a)(2) and this part, 
which specifies for purposes of the UCX Program, the pay and allowances 
for each pay grade of servicemember.
    (m) Secretary means the Secretary of Labor of the United States.
    (n) State means the 50 States, the District of Columbia, the 
Commonwealth of Puerto Rico, and the Virgin Islands.
    (o) State agency means the agency of the State which administers the 
applicable State unemployment compensation law and is administering the 
UCX Program in the State pursuant to an Agreement with the Secretary.
    (p)(1) State law means the unemployment compensation law of a State 
approved by the Secretary under section 3304 of the Internal Revenue 
Code of

[[Page 62]]

1986, 26 U.S.C. 3304, if the State is certified under section 3304(c) of 
the Internal Revenue Code of 1986, 26 U.S.C. 3304(c).
    (2) Applicable State law means the State law made applicable to a 
UCX claimant bySec. 614.8.
    (q)(1) Unemployment compensation means cash benefits (including 
dependents' allowances) payable to individuals with respect to their 
unemployment, and includes regular, additional, emergency, and extended 
compensation.
    (2) Regular compensation means unemployment compensation payable to 
an individual under any State law, but not including additional 
compensation or extended compensation.
    (3) Additional compensation means unemployment compensation totally 
financed by a State and payable under a State law by reason of 
conditions of high unemployment or by reason of other special factors.
    (4) Emergency compensation means supplementary unemployment 
compensation payable under a temporary Federal law after exhaustion of 
regular and extended compensation.
    (5) Extended compensation means unemployment compensation payable to 
an individual for weeks of unemployment in an extended benefit period, 
under those provisions of a State law which satisfy the requirements of 
the Federal-State Extended Unemployment Compensation Act of 1970, as 
amended, 26 U.S.C. 3304 note, and part 615 of this chapter, with respect 
to the payment of extended compensation.
    (r) Unemployment Compensation for Ex-Servicemember means the 
unemployment compensation payable under the Act to claimants eligible 
for the payments, and is referred to as UCX.
    (s) Week means, for purposes of eligibility for and payment of UCX, 
a week as defined in the applicable State law.
    (t) Week of unemployment means a week of total, part-total, or 
partial unemployment as defined in the applicable State law, which shall 
be applied in the same manner and to the same extent to all employment 
and earnings, and in the same manner and to the same extent for the 
purposes of the UCX Program, as if the individual filing for UCX were 
filing a claim for State unemployment compensation.

[47 FR 54697, Dec. 3, 1982, as amended at 53 FR 40554, Oct. 17, 1988; 53 
FR 43799, Oct. 26, 1988; 57 FR 59799, Dec. 15, 1992]



                 Subpart B_Administration of UCX Program



Sec.  614.3  Eligibility requirements for UCX.

    An individual shall be eligible to receive a payment of UCX or 
waiting period credit with respect to a week of unemployment if:
    (a) The individual has Federal military service and Federal military 
wages in the base period under the applicable State law;
    (b) The individual meets the qualifying employment and wage 
requirements of the applicable State law, either on the basis of Federal 
military service and Federal military wages alone or in combination with 
service and wages covered under a State law or under the UCFE Program 
(part 609 of this chapter);
    (c) The individual has filed an initial claim for UCX and, as 
appropriate, has filed a timely claim for waiting period credit or 
payment of UCX with respect to that week of unemployment; and
    (d) The individual is totally, part-totally, or partially 
unemployed, and is able to work, available for work, and seeking work 
within the meaning of or as required by the applicable State law, and is 
not subject to disqualification under this part or the applicable State 
law, with respect to that week of unemployment.

[47 FR 54697, Dec. 3, 1982, as amended at 53 FR 40554, Oct. 17, 1988; 57 
FR 59799, Dec. 15, 1992]



Sec.  614.4  Weekly and maximum benefit amounts.

    (a) Total unemployment. The weekly amount of UCX payable to an 
eligible individual for a week of total unemployment shall be the amount 
that would be payable to the individual as unemployment compensation for 
a week of total unemployment as determined under the applicable State 
law.

[[Page 63]]

    (b) Partial and part-total unemployment. The weekly amount of UCX 
payable for a week of partial or part-total unemployment shall be the 
amount that would be payable to the individual as unemployment 
compensation for a week of partial or part-total unemployment as 
determined under the applicable State law.
    (c) Maximum amount. The maximum amount of UCX which shall be payable 
to an eligible individual during and subsequent to the individual's 
benefit year shall be the maximum amount of all unemployment 
compensation that would be payable to the individual as determined under 
the applicable State law.
    (d) Computation rules. The weekly and maximum amounts of UCX payable 
to an individual under the UCX Program shall be determined under the 
applicable State law to be in the same amount, on the same terms, and 
subject to the same conditions as the State unemployment compensation 
which would be payable to the individual under the applicable State law 
if the individual's Federal military service and Federal military wages 
assigned or transferred under this part to the State had been included 
as employment and wages covered by that State law, subject to the use of 
the applicable Schedule of Remuneration.

[47 FR 54697, Dec. 3, 1982, as amended at 53 FR 40554, Oct. 17, 1988; 57 
FR 59800, Dec. 15, 1992]



Sec.  614.5  Claims for UCX.

    (a) First claims. A first claim for UCX shall be filed by an 
individual in any State agency of any State according to the applicable 
State law, and on a form prescribed by the Department which shall be 
furnished to the individual by the State agency where the claim is 
filed.
    (b) Weekly claims. Claims for waiting week credit and payments of 
UCX for weeks of unemployment shall be filed in any State agency (or 
Canada) at the times and in the manner as claims for State unemployment 
compensation are filed under the applicable State law, and on forms 
prescribed by the Department which shall be furnished to the individual 
by the State agency where the claim is filed.
    (c) Secretary's standard. The procedures for reporting and filing 
claims for UCX and waiting period credit shall be consistent with this 
part 614 and the Secretary's ``Standard for Claim Filing, Claimant 
Reporting, Job Finding and Employment Services'' in the Employment 
Security Manual, part V, sections 5000-5004 (appendix A of this part).

[47 FR 54697, Dec. 3, 1982, as amended at 53 FR 40554, Oct. 17, 1988]



Sec.  614.6  Determinations of entitlement; notices to individual and
Federal military agency.

    (a) Determinations of first claim. Except for findings of a Federal 
military agency and the applicable Schedule of Remuneration which are 
final and conclusive underSec. 614.23, the State agency whose State 
law applies to an individual underSec. 614.8 shall, promptly upon the 
filing of a first claim for UCX, determine whether the individual is 
otherwise eligible, and, if the individual is found to be eligible, the 
individual's benefit year and the weekly and maximum amounts of UCX 
payable to the individual.
    (b) Determinations of weekly claims. The State agency promptly 
shall, upon the filing of a claim for a payment of UCX or waiting period 
credit with respect to a week, determine whether the individual is 
entitled to a payment of UCX or waiting period credit respect to such 
week, and, if entitled, the amount of UCX or waiting period credit to 
which the individual is entitled.
    (c) Redetermination. The provisions of the applicable State law 
concerning the right to request, or authority to undertake, 
reconsideration of a determination pertaining to State unemployment 
compensation under the applicable State law shall apply to 
determinations pertaining to UCX.
    (d) Notices to individual and Federal military agency. (1) The State 
agency promptly shall give notice in writing to the individual of any 
determination or redetermination of a first claim, and, except as may be 
authorized under paragraph (g) of this section, of any determination or 
redetermination of any weekly claim which denies UCX or waiting period 
credit or reduces the weekly amount or maximum amount

[[Page 64]]

initially determined to be payable. Each notice of determination or 
redetermination shall include such information regarding the 
determination or redetermination and notice of right to reconsideration 
or appeal, or both, as is furnished with written notices of 
determinations and redeterminations with respect to claims for State 
unemployment compensation. Such notice shall include the findings of any 
Federal military agency utilized in making the determination or 
redetermination, and shall inform the individual of the finality of 
Federal findings and the individual's right to request correction of 
such findings as is provided inSec. 614.22.
    (2) A notice of claim filing and subsequent notices of monetary and 
nonmonetary determinations on a UCX claim shall be sent to each Federal 
military agency for which the individual performed Federal military 
service during the appropriate base period, together with notice of 
appeal rights of the Federal military agency to the same extent that 
chargeable employers are given such notices under State law and practice 
unless an alternate mechanism is established by the Department of Labor 
in lieu of such notices.
    (e) Obtaining information for claim determinations. (1) Information 
required for the determination of claims for UCX shall be obtained by 
the State agency from claimants, employers, and others, in the same 
manner as information is obtained for claim purposes under the 
applicable State law, but Federal military findings shall be obtained 
from military documents, the applicable Schedule of Remuneration, and 
from Federal military agencies as prescribed in Sec.Sec. 614.21 
through 614.24.
    (f) Promptness. Full payment of UCX when due shall be consistent 
with this part and shall be made with the greatest promptness that is 
administratively feasible, but the provisions of part 640 of this 
chapter (relating to promptness of benefit payments) shall not be 
applicable to the UCX Program.
    (g) Secretary's standard. The procedures for making determinations 
and redeterminations, and furnishing written notices of determinations, 
redeterminations, and rights of appeal to individuals applying for UCX 
and to appropriate Federal military agencies shall be consistent with 
this part 614 and the Secretary's ``Standard for Claim Determinations-
Separation Information'' in the Employment Security Manual, part V, 
sections 6010-6015 (Appendix B of this part).

[47 FR 54697, Dec. 3, 1982, as amended at 53 FR 40554, Oct. 17, 1988; 71 
FR 35514, June 21, 2006]



Sec.  614.7  Appeal and review.

    (a) Applicable State Law. The provisions of the applicable State law 
concerning the right of appeal and fair hearing from a determination or 
redetermination of entitlement to State unemployment compensation 
(exclusive of findings which are final and conclusive underSec. 
614.25) shall apply to determinations and redeterminations of 
eligibility for or entitlement to UCX and waiting period credit. Any 
such determination or redetermination shall be subject to appeal and 
review only in the manner and to the extent provided in the applicable 
State law with respect to determinations and redeterminations of 
entitlement to State unemployment compensation.

(Section 614.24 governs appeals of findings of the Veterans 
Administration)

    (b) Rights of appeal and fair hearing. The provisions on right of 
appeal and opportunity for a fair hearing with respect to claims for UCX 
shall be consistent with this part and with sections 303(a)(1) and 
303(a)(3) of the Social Security Act, 42 U.S.C. 503(a)(1) and 503(a)(3).
    (c) Promptness on appeals. (1) Decisions on appeals under the UCX 
Program shall accord with the Secretary's ``Standard for Appeals 
Promptness--Unemployment Compensation'' in part 650 of this chapter, and 
withSec. 614.1(d).
    (2) Any provision of an applicable State law for advancement or 
priority of unemployment compensation cases on judicial calendars, or 
otherwise intended to provide for the prompt payment of unemployment 
compensation when due, shall apply to proceedings involving claims for 
UCX.

[[Page 65]]

    (d) Appeal and review by Federal military agency. If a Federal 
military agency believes that a State agency's determination or 
redetermination of an individual's eligibility for or entitlement to UCX 
is incorrect, the Federal military agency may seek appeal and review of 
such determination or redetermination in the same manner as an 
interested employer may seek appeal and review under the applicable 
State law.



Sec.  614.8  The applicable State for an individual.

    (a) The applicable State. The applicable State for an individual 
shall be the State to which the individual's Federal military service 
and Federal military wages are assigned or transferred under this 
section. The applicable State law for the individual shall be the State 
law of such State.
    (b) Assignment of service and wages. (1) When an individual files a 
first claim, all of the individual's Federal military service and 
Federal military wages shall be deemed to be assigned to the State in 
which such claim is filed, which shall be the ``Paying State'' in the 
case of a combined-wage claim. (Sec.  616.6(e) of this chapter.)
    (2) Federal military service and Federal military wages assigned to 
a State in error shall be reassigned for use by the proper State agency. 
An appropriate record of the reassignment shall be made by the State 
agency which makes the reassignment.
    (c) Assignment deemed complete. All of an individual's Federal 
military service and Federal military wages shall be deemed to have been 
assigned to a State upon the filing of a first claim. Federal military 
service and Federal military wages shall be assigned to a State only in 
accordance with paragraph (b) of this section.
    (d) Use of assigned service and wages. All assigned Federal military 
service and Federal military wages shall be used only by the State to 
which assigned in accordance with paragraph (b) of this section, except 
that any Federal military service and Federal military wages which are 
not within the base period of the State to which they were assigned 
shall be subject to transfer in accordance with part 616 of this chapter 
for the purposes of any subsequent Combined-Wage Claim filed by the 
individual.



Sec.  614.9  Provisions of State law applicable to UCX claims.

    (a) Particular provisions applicable. Except where the result would 
be inconsistent with the provisions of the Act or this part or the 
procedures thereunder prescribed by the Department, the terms and 
conditions of the applicable State law which apply to claims for, and 
the payment of, State unemployment compensation shall apply to claims 
for, and the payment of, UCX and claims for waiting period credit. The 
provisions of the applicable State law which shall apply include, but 
are not limited to:
    (1) Claim filing and reporting;
    (2) Information to individuals, as appropriate;
    (3) Notices to individuals, as appropriate, including notice to each 
individual of each determination and redetermination of eligibility for 
or entitlement to UCX;
    (4) Determinations and redeterminations;
    (5) Ability to work, availability for work, and search for work; and
    (6) Disqualifications, except in regard to separation from any 
Federal military agency.
    (b) IBPP. The Interstate Benefit Payment Plan shall apply, where 
appropriate, to individuals filing claims for UCX.
    (c) Wage combining. The State's provisions complying with the 
Interstate Arrangement for Combining Employment and Wages (part 616 of 
this chapter) shall apply, where appropriate, to individuals filing 
claims for UCX.
    (d) Procedural requirements. The provisions of the applicable State 
law which apply hereunder to claims for and the payment of UCX shall be 
applied consistently with the requirements of title III of the Social 
Security Act and the Federal Unemployment Tax Act which are pertinent in 
the case of State unemployment compensation, including but not limited 
to those standards and requirements specifically referred to in the 
provisions of this part, except as provided in paragraph (f) ofSec. 
614.6.

[[Page 66]]



Sec.  614.10  Restrictions on entitlement.

    (a) Disqualification. If the week of unemployment for which an 
individual claims UCX is a week to which a disqualification for State 
unemployment compensation applies under the applicable State law, the 
individual shall not be entitled to a payment of UCX for that week. As 
provided inSec. 614.9(a), no disqualification shall apply in regard to 
separation from any Federal military agency.
    (b) Effect of ``days lost''. The continuity of a period of an 
individual's Federal military service shall not be deemed to be 
interrupted by reason of any ``days lost'' in such period, but ``days 
lost'' shall not be counted for purposes of determining:
    (1) Whether an individual has performed Federal military service;
    (2) Whether an individual meets the wage and employment requirements 
of a State law; or
    (3) The amount of an individual's Federal military wages.
    (c) Allocation of military accrued leave. A State agency shall 
allocate the number of days of unused military leave specified in an ex-
servicemember's military document, for which a lump-sum payment has been 
made, in the same manner as similar payments by private employers to 
their employees are allocated under the applicable State law, except 
that the applicable Schedule of Remuneration instead of the lump-sum 
payment shall be used to determine the amount of the claimant's Federal 
military wages. In a State in which a private employer has an option as 
to the period to which such payments shall be allocated, such payments 
shall be allocated to the date of the individual's latest discharge or 
release from Federal military service. An allocation under this 
paragraph shall be disregarded in determining whether an individual has 
had a period of active service constituting Federal military service.
    (d) Education and training allowances. An individual is not entitled 
to UCX under the Act or this part for a period with respect to which the 
individual receives:
    (1) A subsistence allowance for vocational rehabilitation training 
under chapter 31 of title 38 of the United States Code, 38 U.S.C. 1501 
et seq., or under part VIII of Veterans Regulation Numbered 1(a); or
    (2) An educational assistance allowance or special training 
allowance under chapter 35 of title 38 of the United States Code, 38 
U.S.C. 1700 et seq.



Sec.  614.11  Overpayments; penalties for fraud.

    (a) False statements and representations. Section 8507(a) of the Act 
provides that if a State agency, the Department, or a court of competent 
jurisdiction finds that an individual--
    (1) Knowingly has made, or caused to be made by another, a false 
statement or representation of a material fact, or knowingly has failed, 
or caused another to fail, to disclose a material fact; and
    (2) As a result of that action has received an amount as UCX to 
which the individual was not entitled; the individual shall repay the 
amount to the State agency or the Department. Instead of requiring 
repayment, the State agency or the Department may recover the amount by 
deductions from UCX payable to the individual during the 2-year period 
after the date of the finding. A finding by a State agency or the 
Department may be made only after an opportunity for a fair hearing, 
subject to such further review as may be appropriate underSec. 614.7.
    (b) Prosecution for fraud. Section 1919 of title 18, United States 
Code, provides that whoever makes a false statement or representation of 
a material fact knowing it to be false, or knowingly fails to disclose a 
material fact, to obtain or increase for himself or for any other 
individual any payment authorized to be paid under chapter 85 of title 
5, United States Code, or under an agreement thereunder, shall be fined 
not more than $1,000 or imprisoned not more than one year, or both.
    (c) Absence of fraud. If a State agency or court of competent 
jurisdiction finds that an individual has received a payment of UCX to 
which the individual was not entitled under the Act and this part, which 
was not due to a false statement or representation as provided in 
paragraph (a) or (b) of this section, the individual shall be liable to

[[Page 67]]

repay to the applicable State the total sum of the payment to which the 
individual was not entitled, and the State agency shall take all 
reasonable measures authorized under any State law or Federal law to 
recover for the account of the United States the total sum of the 
payment to which the individual was not entitled.
    (d) Recovery by offset. (1) The State agency shall recover, insofar 
as is possible, the amount of any overpayment which is not repaid by the 
individual, by deductions from any UCX payable to the individual under 
the Act and this part, or from any unemployment compensation payable to 
the individual under any Federal unemployment compensation law 
administered by the State agency, or from any assistance or allowance 
payable to the individual with respect to unemployment under any other 
Federal law administered by the State agency.
    (2) A State agency shall also recover, insofar as is possible, the 
amount of any overpayment of UCX made to the individual by another State 
by deductions from any UCX payable by the State agency to the individual 
under the Act and this part, or from any unemployment compensation 
payable to the individual under any Federal unemployment compensation 
law administered by the State agency, or from any assistance or 
allowance payable to the individual with respect to unemployment under 
any other Federal law administered by the State agency.
    (3) Recoupment of fraudulent overpayments referred to in paragraph 
(a) of this section shall be limited to the 2-year period stated in that 
paragraph. Recoupment of fraudulent overpayments referred to in 
paragraph (b) of this section, and nonfraudulent overpayments referred 
to in paragraph (c) of this section shall be subject to any time 
limitation on recoupment provided for in the State law that applies to 
the case.
    (e) Debts due the United States. UCX payable to an individual shall 
be applied by the State agency for the recovery by offset of any debt 
due to the United States from the individual, but shall not be applied 
or used by the State agency in any manner for the payment of any debt of 
the individual to any State or any other entity or person except 
pursuant to a court order for child support or alimony in accordance 
with the law of the State and section 459 of the Social Security Act, 42 
U.S.C. 659.
    (f) Application of State law. (1) Except as indicated in paragraph 
(a) of this section, any provision of State law that may be applied for 
the recovery of overpayments or prosecution for fraud, and any provision 
of State law authorizing waiver of recovery of overpayments of 
unemployment compensation, shall be applicable to UCX.
    (2) In the case of any finding of false statement of representation 
under the Act and paragraph (a) of this section, or prosecution for 
fraud under 18 U.S.C. 1919 or pursuant to paragraph (f)(1) of this 
section, the individual shall be disqualified or penalized in accordance 
with the provision of the applicable State law relating to fraud in 
connection with a claim for State unemployment compensation.
    (g) Final decision. Recovery of any overpayment of UCX shall not be 
enforced by the State agency until the determination or redetermination 
establishing the overpayment has become final, or if appeal is taken 
from the determination or redetermination, until the decision after 
opportunity for a fair hearing has become final.
    (h) Procedural requirements. (1) The provisions of paragraphs (c), 
(d), and (g) ofSec. 614.6 shall apply to determinations and 
redeterminations made pursuant to this section.
    (2) The provisions ofSec. 614.7 shall apply to determinations and 
redeterminations made pursuant to this section.
    (i) Fraud detection and prevention. Provisions in the procedures of 
each State with respect to detection and prevention of fraudulent 
overpayments of UCX shall be, as a minimum, commensurate with the 
procedures adopted by the State with respect to State unemployment 
compensation and consistent with this part 614 and the Secretary's 
``Standard for Fraud and Overpayment Detection'' in the Employment 
Security Manual, part V, sections 7510-7515 (Appendix C of this part), 
and provide for timely use of any crossmatch

[[Page 68]]

mechanism established by the Department.
    (j) Recovered overpayments. An amount repaid or recouped under this 
section shall be--
    (1) Deposited in the fund from which payment was made, if the 
repayment was to a State agency; or
    (2) Returned to the Treasury of the United States and credited to 
the current applicable appropriation, fund, or account from which 
payment was made, if the repayment was to the Department.

[47 FR 54697, Dec. 3, 1982, as amended at 53 FR 40555, Oct. 17, 1988]



Sec.  614.12  Schedules of remuneration.

    (a) Authority. Section 8521(a)(2) of chapter 85, title 5 of the 
United States Code, 5 U.S.C. 8521(a)(2), requires the Secretary of Labor 
to issue from time to time, after consultation with the Secretary of 
Defense, a Schedule of Remuneration specifying the pay and allowances 
for each pay grade of members of the Armed Forces.
    (b) Elements of schedule. A schedule reflects representative amounts 
for appropriate elements of the pay and allowances, whether in cash or 
kind, for each pay grade of members of the Armed Forces, with a 
statement of the effective date of the schedule. Benefit amounts for the 
UCX Program are computed on the basis of the Federal military wages for 
the pay grade of the individual at the time of the individual's latest 
discharge or release from Federal military service, as specified in the 
schedule applicable at the time the individual files his or her first 
claim for compensation for the benefit year.
    (c) Effective date. Any new Schedule of Remuneration shall take 
effect beginning with the first week of the calendar quarter following 
the calendar quarter in which such schedule is issued, and shall remain 
applicable until a subsequent schedule becomes effective. Prior 
schedules shall continue to remain applicable for the periods they were 
in effect.
    (d) Publication. Any new Schedule of Remuneration shall be issued by 
the Secretary of Labor to the State agencies and the Federal military 
agencies. Promptly after the issuance of a new Schedule of Remuneration 
it shall be published as a notice in the Federal Register.



Sec.  614.13  Inviolate rights to UCX.

    Except as specifically provided in this part, the rights of 
individuals to UCX shall be protected in the same manner and to the same 
extent as the rights of persons to State unemployment compensation are 
protected under the applicable State law. Such measures shall include 
protection of applicants for UCX from waiver, release, assignment, 
pledge, encumbrance, levy, execution, attachment, and garnishment of 
their rights to UCX, except as provided inSec. 614.11. In the same 
manner and to the same extent, individuals shall be protected from 
discrimination and obstruction in regard to seeking, applying for, and 
receiving any right to UCX.



Sec.  614.14  Recordkeeping; disclosure of information.

    (a) Recordkeeping. Each State agency will make and maintain records 
pertaining to the administration of the UCX Program as the Department 
requires, and will make all such records available for inspection, 
examination, and audit by such Federal officials or employees as the 
Department may designate or as may be required by law.
    (b) Disclosure of information. Information in records maintained by 
a State agency in administering the UCX Program shall be kept 
confidential, and information in such records may be disclosed only in 
the same manner and to the same extent as information with respect to 
State unemployment compensation and the entitlement of individuals 
thereto may be disclosed under the applicable State law. This provision 
on the confidentiality of information maintained in the administration 
of the UCX Program shall not apply, however, to the Department or for 
the purposes of Sec.Sec. 614.11 or 614.14, or in the case of 
information, reports and studies required pursuant to Sec.Sec. 614.18 
or 614.26, or where the result would be inconsistent with the Freedom of 
Information Act, 5 U.S.C. 552, the Privacy Act of 1974, 5 U.S.C. 552a, 
or regulations of the Department promulgated thereunder.

[[Page 69]]



Sec.  614.15  Payments to States.

    (a) State entitlement. Each State is entitled to be paid by the 
United States with respect to each individual whose base period wages 
included Federal military wages, an amount bearing the same ratio to the 
total amount of compensation paid to such individual as the amount of 
the individual's Federal military wages in the individual's base period 
bears to the total amount of the individual's base period wages.
    (b) Payment. Each State shall be paid, either in advance or by way 
of reimbursement, as may be determined by the Department, the sum that 
the Department estimates the State is entitled to receive under the Act 
and this part for each calendar month. The sum shall be reduced or 
increased by the amount which the Department finds that its estimate for 
an earlier calendar month was greater or less than the sum which should 
have been paid to the State. An estimate may be made on the basis of a 
statistical, sampling, or other method agreed on by the Department and 
the State agency.
    (c) Certification by the Department. The Department, from time to 
time, shall certify to the Secretary of the Treasury the sum payable to 
each State under this section. The Secretary of the Treasury, before 
audit or settlement by the General Accounting Office, shall pay the 
State in accordance with the certification from the funds for carrying 
out the purposes of the Act and this part.
    (d) Use of money. Money paid a State under the Act and this part may 
be used solely for the purposes for which it is paid. Money so paid 
which is not used solely for these purposes shall be returned, at the 
time specified by the Agreement, to the Treasury of the United States 
and credited to the current applicable appropriation, fund, or account 
from which payments to States under the Act and this part may be made.



Sec.  614.16  Public access to Agreements.

    The State agency of a State will make available to any individual or 
organization a true copy of the Agreement with the State for inspection 
and copying. Copies of an Agreement may be furnished on request to any 
individual or organization upon payment of the same charges, if any, as 
apply to the furnishing of copies of other records of the State agency.



Sec.  614.17  Administration in absence of an Agreement.

    (a) Administering program. The Department shall administer the UCX 
Program through personnel of the Department or through other 
arrangements under procedures prescribed by the Department, in the case 
of any State which does not have an Agreement with the Secretary as 
provided for in 5 U.S.C. 8502. The procedures prescribed by the 
Department under this section shall be consistent with the Act and this 
part.
    (b) Applicable State law. On the filing by an individual of a claim 
for UCX in accordance with arrangements under this section, UCX shall be 
paid to the individual, if eligible, in the same amount, on the same 
terms, and subject to the same conditions as would be paid to the 
individual under the applicable State law if the individual's Federal 
military service and Federal military wages had been included as 
employment and wages under the State law. Any such claims shall include 
the individual's Federal military service and Federal military wages, 
combined with any service and wages covered by State law. However, if 
the individual, without regard to his or her Federal military service 
and Federal military wages, has employment or wages sufficient to 
qualify for compensation during the benefit year under that State law, 
then payments of UCX under this section may be made only on the basis of 
the individual's Federal military service and Federal military wages.
    (c) Fair hearing. An individual whose claim for UCX is denied under 
this section is entitled to a fair hearing under rules of procedures 
prescribed by the Department. A final determination by the Department 
with respect to entitlement to UCX under this section is subject to 
review by the courts in the same manner and to the same extent as is 
provided by section 205(g) of the Social Security Act, 42 U.S.C. 405(g).

[[Page 70]]



Sec.  614.18  Information, reports, and studies.

    State agencies shall furnish to the Department such information and 
reports and conduct such studies as the Department determines are 
necessary or appropriate for carrying out the purposes of the UCX 
Program.



   Subpart C_Responsibilities of Federal Military Agencies and State 
                                Agencies



Sec.  614.20  Information to ex-servicemembers.

    At the time of discharge or release from Federal military service, 
each Federal military agency shall furnish to each ex-servicemember 
information explaining rights and responsibilities under the UCX Program 
and 18 U.S.C. 1919, and military documents necessary for filing claims 
for UCX.



Sec.  614.21  Findings of Federal military agency.

    (a) Findings in military documents. Information contained in a 
military document furnished to an ex-servicemember shall constitute 
findings to whichSec. 614.23 applies as to:
    (1) Whether the individual has performed active service in the Armed 
Forces or the Commissioned Corps of the National Oceanic and Atmospheric 
Administration;
    (2) The beginning and ending dates of the period of active service 
and ``days lost'' during such period;
    (3) The type of discharge or release terminating the period of 
active service;
    (4) The individuals' pay grade at the time of discharge or release 
from active service; and
    (5) The narrative reason or other reason for separation from active 
service.
    (b) Discharges not under honorable conditions. A military document 
which shows that an individual's discharge or release was under other 
than honorable conditions shall also be a finding to whichSec. 614.23 
applies.

[53 FR 40555, Oct. 17, 1988]



Sec.  614.22  Correcting Federal findings.

    (a) Request for correction. (1) If an individual believes that a 
finding specified inSec. 614.21 is incorrect or that information as to 
any finding has been omitted from a military document, the individual 
may request the issuing Federal military agency to correct the military 
document. A request for correction may be made through the State agency, 
which shall forward such request and any supporting information 
submitted by the individual to the Federal military agency.
    (2) The Federal military agency shall promptly forward to the 
individual or State agency making the request the corrected military 
document. Information contained in a corrected military document issued 
pursuant to such a request shall constitute the findings of the Federal 
military agency underSec. 614.21.
    (3) If a determination or redetermination based on a finding as to 
which correction is sought has been issued by a State agency before a 
request for correction under this paragraph is made, the individual who 
requested such correction shall file a request for redetermination or 
appeal from such determination or redetermination with the State agency, 
and shall inform the State agency of the request for correction.
    (4) An individual who files a request for correction of findings 
under this paragraph shall promptly notify the State agency of the 
action of the Federal military agency on such request.
    (b) State agency procedure when request made. (1) If a determination 
of entitlement has not been made when an individual notifies a State 
agency of a request for correction under paragraph (a) of this section, 
the State agency may postpone such determination until the individual 
has notified the State agency of the action of the Federal military 
agency on the request.
    (2) If a determination of entitlement has been made when an 
individual notifies a State agency that a request for correction of 
Federal findings has been made, or if an individual notifies a State 
agency prior to a determination of entitlement that a request has been 
made but such determination is not postponed by the State agency, the 
individual may file a request for redetermination or appeal in 
accordance with the applicable State law.

[[Page 71]]

    (3) Except as provided in paragraph (c) of this section, no 
redetermination shall be made or hearing scheduled on an appeal until 
the individual has notified the State agency of the action of the 
Federal military agency on a request for correction under paragraph (a) 
of this section.
    (c) State agency procedure when request answered. On receipt of 
notice of the action of a Federal military agency on a request for 
correction of its findings, a State agency shall:
    (1) Make a timely determination or redetermination of the 
individual's entitlement, or
    (2) Promptly schedule a hearing on the individual's appeal.

If such notice is not received by a State agency within one year of the 
date on which an individual first filed a claim, or such notice is not 
given promptly by an individual, a State agency without further 
postponement may make such determination or redetermination or schedule 
such hearing.
    (d) Findings corrected without request. Information as to any 
finding specified inSec. 614.21 contained in a corrected military 
document issued by a Federal military agency on its own motion shall 
constitute the findings of such agency underSec. 614.21, if notice 
thereof is received by a State agency before the period for 
redetermination or appeal has expired under the State law. On timely 
receipt of such notice a State agency shall take appropriate action 
under the applicable State law to give effect to the corrected findings.



Sec.  614.23  Finality of findings.

    The findings of a Federal military agency referred to in Sec.Sec. 
614.21 and 614.22, and the Schedules of Remuneration issued by the 
Department pursuant to the Act andSec. 614.12, shall be final and 
conclusive for all purposes of the UCX Program, including appeal and 
review pursuant toSec. 614.7 orSec. 614.17.

[53 FR 40555, Oct. 17, 1988]



Sec.  614.24  Furnishing other information.

    (a) Additional information. In addition to the information required 
by Sec.Sec. 614.21 and 614.22, a Federal military agency shall furnish 
to a State agency or the Department, within the time requested, any 
information which it is not otherwise prohibited from releasing by law, 
which the Department determines is necessary for the administration of 
the UCX Program.
    (b) Reports. Federal military agencies shall furnish to the 
Department or State agencies such reports containing such information as 
the Department determines are necessary or appropriate for carrying out 
the purposes of the UCX Program.

[47 FR 54697, Dec. 3, 1982, as amended at 53 FR 40555, Oct. 17, 1988]



Sec.  614.25  Liaison with Department

    To facilitate the Department's administration of the UCX program, 
each Federal military agency shall designate one or more of its 
officials to be the liaison with the Department. Each Federal military 
agency will inform the Department of its designation(s) and of any 
change in a designation.

[53 FR 40555, Oct. 17, 1988]



    Sec. Appendix A to Part 614--Standard for Claim Filing, Claimant 
             Reporting, Job Finding, and Employment Services

        Employment Security Manual (Part V, Sections 5000-5004) *
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    * Revises subgrouping 5000-5004.
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                         5000-5099 Claims Filing

5000 Standards for Claim Filing, Claimant Reporting, Job Finding, and 
          Employment Services
    A. Federal law requirements. Section 3304(a)(1) of the Federal 
Unemployment Tax Act and section 303(a)(2) of the Social Security Act 
require that a State law provide for:
    ``Payment of unemployment compensation solely through public 
employment offices or such other agencies as the Secretary may 
approve.''
    Section 3304(a)(4) of the Federal Unemployment Tax Act and section 
303(a)(5) of the Social Security Act require that a State law provide 
for:
    ``Expenditure of all money withdrawn from an unemployment fund of 
such State, in the payment of unemployment compensation. * * *''
    Section 303(a)(1) of the Social Security Act requires that the State 
law provide for:
    ``Such methods of administration * * * as are found by the Secretary 
to be reasonably calculated to insure full payment of unemployment 
compensation when due.''

[[Page 72]]

    B. Secretary's interpretation of Federal law requirements.
    1. The Secretary interprets section 3304(a)(1) of the Federal 
Unemployment Tax Act and section 303(a)(2) of the Social Security Act to 
require that a State law provide for payment of unemployment 
compensation solely through public employment offices or claims offices 
administered by the State employment security agency if such agency 
provides for such coordination in the operations of its public 
employment offices and claims offices as will insure: (a) The payment of 
benefits only to individuals who are unemployed and who are able to work 
and available for work, and (b) that individuals claiming unemployment 
compensation (claimants) are afforded such placement and other 
employment services as are necessary and appropriate to return them to 
suitable work as soon as possible.
    2. The Secretary interprets all the above sections to require that a 
State law provide for:
    a. Such contact by claimants with public employment offices or 
claims offices or both, (1) as will reasonably insure the payment of 
unemployment compensation only to individuals who are unemployed and who 
are able to work and available for work, and (2) that claimants are 
afforded such placement and other employment services as are necessary 
and appropriate to facilitate their return to suitable work as soon as 
possible; and
    b. Methods of administration which do not unreasonably limit the 
opportunity of individuals to establish their right to unemployment 
compensation due under such State law.

5001 Claim Filing and Claimant Reporting Requirements Designed to 
Satisfy Secretary's Interpretation
    A. Claim filing--total or part-total unemployment.
    1. Individuals claiming unemployment compensation for total or part-
total unemployment are required to file a claim weekly or biweekly, in 
person or by mail, at a public employment office or a claims office 
(these terms include offices at itinerant points) as set forth below.
    2. Except as provided in paragraph 3, a claimant is required to file 
in person:
    a. His new claim with respect to a benefit year, or his continued 
claim for a waiting week or for his first compensable week of 
unemployment in such year; and
    b. Any other claim, when requested to do so by the claims personnel 
at the office at which he files his claim(s) because questions about his 
right to benefits are raised by circumstances such as the following:
    (1) The conditions or circumstances of his separation from 
employment;
    (2) The claimant's answers to questions on mail claim(s) indicate 
that he may be unable to work or that there may be undue restrictions on 
his availability for work or that his search for work may be inadequate 
or that he may be disqualified;
    (3) The claimant's answers to questions on mail claims create 
uncertainty about his credibility or indicate a lack of understanding of 
the applicable requirement; or
    (4) The claimant's record shows that he has previously filed a 
fraudulent claim.
    In such circumstances, the claimant is required to continue to file 
claims in person each week (or biweekly) until the State agency 
determines that filing claims in person is no longer required for the 
resolution of such questions.
    3. A claimant must be permitted to file a claim by mail in any of 
the following circumstances:
    a. He is located in an area requiring the expenditure of an 
unreasonable amount of time or money in traveling to the nearest 
facility established by the State agency for filing claims in person;
    b. Conditions make it impracticable for the agency to take claims in 
person;
    c. He has returned to full-time work on or before the scheduled date 
for his filing a claim, unless the agency makes provision for in-person 
filing at a time and place that does not interfere with his employment;
    d. The agency finds that he has good cause for failing to file a 
claim in person.
    4. A claimant who has been receiving benefits for partial 
unemployment may continue to file claims as if he were a partially 
unemployed worker for the first four consecutive weeks of total or part-
total unemployment immediately following his period of partial 
unemployment so long as he remains attached to his regular employer.
    B. Claim filing--partial unemployment. Each individual claiming 
unemployment compensation for a week (or other claim period) during 
which, because of lack of work, he is working less than his normal 
customary full-time hours for his regular employer and is earning less 
than the earnings limit provided in the State law, shall not be required 
to file a claim for such week or other claim period earlier than 2 weeks 
from the date that wages are paid for such claim period or, if a low 
earnings report is required by the State law, from the date the employer 
furnished such report to the individual. State agencies may permit 
claims for partial unemployment to be filed either in person or by mail, 
except that in the circumstances set forth in section A 3, filing by 
mail must be permitted, and in the circumstances set forth in section A 
2 b, filing in person may be required.

5002 Requirement for Job Finding, Placement, and other Employment 
Services Designed to Satisfy Secretary's Interpretation

[[Page 73]]

    A. Claims personnel are required to assure that each claimant is 
doing what a reasonable individual in his circumstances would do to 
obtain suitable work.
    B. In the discretion of the State agency:
    1. The claims personnel are required to give each claimant such 
necessary and appropriate assistance as they reasonably can in finding 
suitable work and at their discretion determine when more complete 
placement and employment services are necessary and appropriate for a 
claimant; and if they determine more complete services are necessary and 
appropriate, the claims personnel are to refer him to employment service 
personnel in the public employment office in which he has been filing 
claim(s), or, if he has been filing in a claims office, in the public 
employment office most accessible to him; or
    2. All placement and employment services are required to be afforded 
to each claimant by employment service personnel in the public 
employment office most accessible to him, in which case the claims 
personnel in the office in which the claimant files his claim are to 
refer him to the employment service personnel when placement or other 
employment services are necessary and appropriate for him.
    C. The personnel to whom the State agency assigns the 
responsibilities outlined in paragraph B above are required to give 
claimants such job-finding assistance, placement, and other employment 
services as are necessary and appropriate to facilitate their return to 
suitable work as soon as possible.
    In some circumstances, no such services or only limited services may 
be required. For example, if a claimant is on a short-term temporary 
layoff with a fixed return date, the only service necessary and 
appropriate to be given to him during the period of the layoff is a 
referral to suitable temporary work if such work is being performed in 
the labor market area.
    Similarly, claimants whose unemployment is caused by a labor dispute 
presumably will return to work with their employer as soon as the labor 
dispute is settled. They generally do not need services, nor do 
individuals in occupations where placement customarily is made by other 
nonfee charging placement facilities such as unions and professional 
associations.
    Claimants who fall within the classes which ordinarily would require 
limited services or no services shall, if they request placement and 
employment services, be afforded such services as are necessary and 
appropriate for them to obtain suitable work or to achieve their 
reasonable employment goals.
    On the other hand, a claimant who is permanently separated from his 
job is likely to require some services. He may need only some direction 
in how to get a job; he may need placement services if he is in an 
occupation for which there is some demand in the labor market area; if 
his occupation is outdated, he may require counseling and referral to a 
suitable training course. The extent and character of the services to be 
given any particular claimant may change with the length of his 
unemployment and depend not only on his own circumstances and 
conditions, but also on the condition of the labor market in the area.
    D. Claimants are required to report to employment service personnel, 
as directed, but such personnel and the claims personnel are required to 
so arrange and coordinate the contacts required of a claimant as not to 
place an unreasonable burden on him or unreasonably limit his 
opportunity to establish his rights to compensation. As a general rule, 
a claimant is not required to contact in person claims personnel or 
employment service personnel more frequently than once a week, unless he 
is directed to report more frequently for a specific service such as 
referral to a job or a training course or counseling which cannot be 
completed in one visit.
    E. Employment service personnel are required to report promptly to 
claims personnel in the office in which the claimant files his claim(s): 
(1) His failure to apply for or accept work to which he was referred by 
such personnel or when known, by any other nonfee-charging placement 
facility such as a union or a professional association; and (2) any 
information which becomes available to it that may have a bearing on the 
claimant's ability to work or availability for work, or on the 
suitability of work to which he was referred or which was offered to 
him.

5004 Evaluation of Alternative State Provisions. If the State law 
provisions do not conform to the ``suggested State law requirements'' 
set forth in sections 5001 and 5002, but the State law contains 
alternative provisions, the Manpower Administrator, in collaboration 
with the State agency, will study the actual or anticipated effect of 
the alternative provisions. If the Manpower Administrator concludes that 
the alternative provisions satisfy the requirements of the Federal law 
as construed by the Secretary (see section 5000 B) he will so notify the 
State agency. If he does not so conclude, he will submit the matter to 
the Secretary. If the Secretary concludes that the alternative 
provisions satisfy such requirements, the State agency will be so 
notified. If the Secretary concludes that there is a question as to 
whether the alternative provisions satisfy such requirements, the State 
agency will be advised that unless the State law provisions are 
appropriately revised, a notice of hearing will be issued as required by 
the Code

[[Page 74]]

of Federal Regulations, title 20, section 601.3.

[53 FR 40555, Oct. 17, 1988; 53 FR 43799, Oct. 26, 1988]



     Sec. Appendix B to Part 614--Standard for Claim Determination--
                         Separation Information

         Employment Security Manual (Part V, Sections 6010-6015)

6010-6019 Standard for Claim Determinations--Separation Information *
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    * Revises subgrouping 6010-6019
---------------------------------------------------------------------------

6010 Federal Law Requirements. Section 303(a)(1) of the Social Security 
          Act requires that a State law include provision for:
    ``Such methods of administration . . . as are found by the Secretary 
to be reasonably calculated to insure full payment of unemployment 
compensation when due.''
    Section 303(a)(3) of the Social Security Act requires that a State 
law include provision for:
    ``Opportunity for a fair hearing before an impartial tribunal, for 
all individuals whose claims for unemployment compensation are denied.''
    Section 3304(a)(4) of the Federal Unemployment Tax Act and section 
303(a)(5) of the Social Security Act require that a State law include 
provision for:
    ``Expenditure of all money withdrawn from an unemployment fund of 
such State, in the payment of unemployment compensation * * *.
    Section 3306(h) of the Federal Unemployment Tax Act defines 
``compensation'' as ``cash benefits payable to individuals with respect 
to their unemployment.''

6011 Secretary's Interpretation of Federal Law Requirements. The 
Secretary interprets the above sections to require that a State law 
include provisions which will insure that:
    A. Individuals who may be entitled to unemployment compensation are 
furnished such information as will reasonably afford them an opportunity 
to know, establish, and protect their rights under the unemployment 
compensation law of such State, and
    B. The State agency obtains and records in time for the prompt 
determination and review of benefit claims such information as will 
reasonably insure the payment of benefits to individuals to whom 
benefits are due.

6012 Criteria for Review of State Law Conformity with Federal 
Requirements
    In determining the conformity of a State law with the above 
requirements of the Federal Unemployment Tax Act and the Social Security 
Act as interpreted by the Secretary, the following criteria will be 
applied:
    A. Is it required that individuals who may be entitled to 
unemployment compensation be furnished such information of their 
potential rights to benefits, including the manner and places of filing 
claims, the reasons for determinations, and their rights of appeal, as 
will insure them a reasonable opportunity to know, establish, and 
protect their rights under the law of the State?
    B. Is the State agency required to obtain, in time for prompt 
determination of rights to benefits such information as will reasonably 
insure the payment of benefits to individuals to whom benefits are due?
    C. Is the State agency required to keep records of the facts 
considered in reaching determinations of rights to benefits?
6013 Claim Determinations Requirements Designed To Meet Department of 
          Labor Criteria
    A. Investigation of claims. The State agency is required to obtain 
promptly and prior to a determination of an individual's right to 
benefits, such facts pertaining thereto as will be sufficient reasonably 
to insure the payment of benefits when due.
    This requirement embraces five separate elements:
    1. It is the responsibility of the agency to take the initiative in 
the discovery of information. This responsibility may not be passed on 
the claimant or the employer. In addition to the agency's own records, 
this information may be obtained from the worker, the employer, or other 
sources. If the information obtained in the first instance discloses no 
essential disagreement and provides a sufficient basis for a fair 
determination, no further investigation is necessary. If the information 
obtained from other sources differs essentially from that furnished by 
the claimant, the agency, in order to meet its responsibility, is 
required to inform the claimant of such information from other sources 
and to afford the claimant an opportunity to furnish any further facts 
he may have.
    2. Evidentiary facts must be obtained as distinguished from ultimate 
facts or conclusions. That a worker was discharged for misconduct is an 
ultimate fact or conclusion; that he destroyed a machine upon which he 
was working is a primary or evidentiary fact, and the sort of fact that 
the requirement refers to.
    3. The information obtained must be sufficient reasonably to insure 
the payment of benefits when due. In general, the investigation made by 
the agency must be complete enough to provide information upon which the 
agency may act with reasonable assurance that its decision is consistent 
with the unemployment compensation law. On the other hand, the 
investigation should not be so exhaustive and time-consuming as unduly 
to delay the payment of benefits and to result in excessive costs.

[[Page 75]]

    4. Information must be obtained promptly so that the payment of 
benefits is not unduly delayed.
    5. If the State agency requires any particular evidence from the 
worker, it must give him a reasonable opportunity to obtain such 
evidence.
    B. Recording of facts. The agency must keep a written record of the 
facts considered in reaching its determinations.
    C. Determination notices
    1. The agency must give each claimant a written notice of:
    a. Any monetary determination with respect to his benefit year;
    b. Any determination with respect to purging a disqualification if, 
under the State law, a condition or qualification must be satisfied with 
respect to each week of disqualification; but in lieu of giving written 
notice of each determination for each week in which it is determined 
that the claimant has met the requirements for purging the agency may 
inform the claimant that he has purged the disqualification for a week 
by notation on his applicant identification card or otherwise in 
writing.
    c. Any other determination which adversely affects \1\ his rights to 
benefits, except that written notice of determination need not be given 
with respect to:
---------------------------------------------------------------------------

    \1\ A determination ``adversely affects'' claimant's right to 
benefits if it: (1) Results in a denial to him of benefits (including a 
cancellation of benefits or wage credits or any reduction in whole or in 
part below the weekly or maximum amount established by his monetary 
determination) for any week or other period; or (2) denies credit for a 
waiting week; or (3) applies any disqualification or penalty; or (4) 
determines that he has not satisfied a condition of eligibility, 
requalification for benefits, or purging a disqualification; or (5) 
determines that an overpayment has been made or orders repayment or 
recoupment of any sum paid to him; or (6) applies a previously 
determined overpayment, penalty, or order for repayment or recoupment; 
or (7) in any other way denies claimant a right to benefits under the 
State law.
---------------------------------------------------------------------------

    (1) A week in a benefit year for which the claimant's weekly benefit 
amount is reduced in whole or in part by earnings if, the first time in 
the benefit year that there is such a reduction, he is required to be 
furnished a booklet or leaflet containing the information set forth 
below in paragraph 2f(1). However, a written notice of determination is 
required if: (a) There is a dispute concerning the reduction with 
respect to any week (e.g., as to the amount computed as the appropriate 
reduction, etc.); or (b) there is a change in the State law (or in the 
application thereof) affecting the reduction; or
    (2) Any week in a benefit year subsequent to the first week in such 
benefit year in which benefits were denied, or reduced in whole or in 
part for reasons other than earnings, if denial or reduction for such 
subsequent week is based on the same reason and the same facts as for 
the first week, and if written notice of determination is required to be 
given to the claimant with respect to such first week, and with such 
notice of determination, he is required to be given a booklet or 
pamphlet containing the information set forth below in paragraphs 2f(2) 
and 2h. However, a written notice of determination is required if: (a) 
There is a dispute concerning the denial or reduction of benefits with 
respect to such week; or (b) there is a change in the State law (or in 
the application thereof) affecting the denial or reduction; or (c) there 
is a change in the amount of the reduction except as to the balance 
covered by the last reduction in a series of reductions.
    Note: This procedure may be applied to determinations made with 
respect to any subsequent weeks for the same reason and on the basis of 
the same facts: (a) That claimant is unable to work, unavailable for 
work, or is disqualified under the labor dispute provision; and (b) 
reducing claimant's weekly benefit amount because of income other than 
earnings or offset by reason of overpayment.
    2. The agency must include in written notices of determinations 
furnished to claimants sufficient information to enable them to 
understand the determinations, the reasons therefor, and their rights to 
protest, request reconsideration, or appeal.
    The written notice of monetary determination must contain the 
information specified in the following items (except h) unless an item 
is specifically not applicable. A written notice of any other 
determination must contain the information specified in as many of the 
following items as are necessary to enable the claimant to understand 
the determination and to inform him of his appeal rights. Information 
specifically applicable to the individual claimant must be contained in 
the written notice of determination. Information of general application 
such as (but not limited to) the explanation of benefits for partial 
unemployment, information as to deductions, seasonality factors, and 
information as to the manner and place of taking an appeal, extension of 
the appeal period, and where to obtain information and assistance may be 
contained in a booklet or leaflet which is given the claimant with his 
monetary determination.
    a. Base period wages. The statement concerning base-period wages 
must be in sufficient detail to show the basis of computation of 
eligibility and weekly and maximum benefit amounts. (If maximum benefits 
are allowed, it may not be necessary to show details of earnings.)

[[Page 76]]

    b. Employer name. The name of the employer who reported the wages is 
necessary so that the worker may check the wage transcript and know 
whether it is correct. If the worker is given only the employer number, 
he may not be able to check the accuracy of the wage transcript.
    c. Explanation of benefit formula--weekly and maximum benefit 
amounts. Sufficient information must be given the worker so that he will 
understand how his weekly benefit amount, including allowances for 
dependents, and his maximum benefit amount were figured. If benefits are 
computed by means of a table contained in the law, the table must be 
furnished with the notice of determination whether benefits are granted 
or denied.
    The written notice of determination must show clearly the weekly 
benefit amount and the maximum potential benefits to which the claimant 
is entitled.
    The notice to a claimant found ineligible by reason of insufficient 
earnings in the base period must inform him clearly of the reason for 
ineligibility. An explanation of the benefit formula contained in a 
booklet or pamphlet should be given to each claimant at or prior to the 
time he receives written notice of a monetary determination.
    d. Benefit year. An explanation of what is meant by the benefit year 
and identification of the claimant's benefit year must be included in 
the notice of determinaton.
    e. Information as to benefits for partial unemployment. There must 
be included either in the written notice of determination or in a 
booklet or pamphlet accompanying the notice an explanation of the 
claimant's rights to partial benefits for any week with respect to which 
he is working less than his normal customary full-time workweek because 
of lack of work and for which he earns less than his weekly benefit 
amount or weekly amount plus earnings, whichever is provided by the 
State law. If the explanation is contained in the notice of 
determination, reference to the item in the notice in which his weekly 
benefit amount is entered should be made.
    f. Deductions from weekly benefits.
    (1) Earnings. Although written notice of determinations deducting 
earnings from a claimant's weekly benefit amount is generally not 
required (see paragraph 1c (1) above), where written notice of 
determination is required (or given) it shall set forth the amount of 
earnings, the method of computing the deduction in sufficient detail to 
enable the claimant to verify the accuracy of the deduction, and his 
right to protest, request redetermination, and appeal. Where a written 
notice of determination is given to the claimant because there has been 
a change in the State law or in the application of the law, an 
explanation of the change shall be included.
    Where claimant is not required to receive a written notice of 
determination, he must be given a booklet or pamphlet the first time in 
his benefit year that there is a deduction for earnings which shall 
include the following information:
    (a) The method of computing deductions for earnings in sufficient 
detail to enable the claimant to verify the accuracy of the deduction;
    (b) That he will not automatically be given a written notice of 
determination for a week with respect to which there is a deduction for 
earnings (unless there is a dispute concerning the reduction with 
respect to a week or there has been a change in the State law or in the 
application of the law affecting the deduction) but that he may obtain 
such a written notice upon request; and
    (c) A clear statement of his right to protest, request a 
redetermination, and appeal from any determination deducting earnings 
from his weekly benefit amount even though he does not automatically 
receive a written notice of determination; and if the State law requires 
written notice of determination in order to effectuate a protest, 
redetermination, or appeal, he must be so advised and advised also that 
he must request a written notice of determination before he takes any 
such action.
    (2) Other deductions.
    (a) A written notice of determination is required with respect to 
the first week in claimant's benefit year in which there is a reduction 
from his benefits for a reason other than earnings. This notice must 
describe the deduction made from claimant's weekly benefit amount, the 
reason for the deduction, the method of computing it in sufficient 
detail to enable him to verify the accuracy of such deduction, and his 
right to protest, request redetermination, or appeal.
    (b) A written notice of determination is not required for subsequent 
weeks that a deduction is made for the same reason and on the basis of 
the same facts, if the notice of determination pursuant to (2)(a), or a 
booklet or pamphlet given him with such notice explains: (i) The several 
kinds of deductions which may be made under the State law (e.g., 
retirement pensions, vacation pay, and overpayments); (ii) the method of 
computing each kind of deduction in sufficient detail that claimant will 
be able to verify the accuracy of deductions made from his weekly 
benefit payments; (iii) any limitation on the amount of any deduction or 
the time in which any deduction may be made; (iv) that he will not 
automatically be given a written notice of determination for subsequent 
weeks with respect to which there is a deduction for the same reason and 
on the basis of the same facts, but that he may obtain a written notice 
of determination upon request; (v) his right to protest, request 
redetermination, or appeal with respect to subsequent weeks for which 
there is a reduction from his benefits for the same reason, and on

[[Page 77]]

the basis of the same facts even though he does not automatically 
receive a written notice of determination; and (vi) that if the State 
law requires written notice of determination in order to effectuate a 
protest, redetermination, or appeal, he must be so advised and advised 
also that he must request a written notice of determination before he 
takes any such action.
    g. Seasonality factors. If the individual's determination is 
affected by seasonality factors under the State law, an adequate 
explanation must be made. General explanations of seasonality factors 
which may affect determinations for subsequent weeks may be included in 
a booklet or pamphlet given with his notice of monetary determination.
    h. Disqualification or ineligibility. If a disqualification is 
imposed, or if the claimant is declared ineligible for one or more 
weeks, he must be given not only a statement of the period of 
disqualification or ineligibility and the amount of wage-credit 
reductions, if any, but also an explanation of the reason for the 
ineligibility or disqualification. This explanation must be sufficiently 
detailed so that he will understand why he is ineligible or why he has 
been disqualified, and what he must do in order to requalify for 
benefits or purge the disqualification. The statement must be 
individualized to indicate the facts upon which the determination was 
based, e.g., state, ``It is found that you left your work with Blank 
Company because you were tired of working; the separation was voluntary, 
and the reason does not constitute good cause,'' rather than merely the 
phrase ``voluntary quit.'' Checking a box as to the reason for the 
disqualification is not a sufficiently detailed explanation. However, 
this statement of the reason for the disqualification need not be a 
restatement of all facts considered in arriving at the determination.
    i. Appeal rights. The claimant must be given information with 
respect to his appeal rights.
    (1) The following information shall be included in the notice of 
determination:
    (a) A statement that he may appeal or, if the State law requires or 
permits a protest or redetermination before an appeal, that he may 
protest or request a redetermination.
    (b) The period within which an appeal, protest, or request for 
redetermination must be filed. The number of days provided by statute 
must be shown as well as either the beginning date or ending date of the 
period. (It is recommended that the ending date of the appeal period be 
shown, as this is the more understandable of the alternatives.)
    (2) The following information must be included either in the notice 
of determination or in separate informational material referred to in 
the notice:
    (a) The manner in which the appeal, protest, or request for 
redetermination must be filed, e.g., by signed letter, written 
statement, or on a prescribed form, and the place or places to which the 
appeal, protest, or request for redetermination may be mailed or hand-
delivered.
    (b) An explanation of any circumstances (such as nonworkdays, good 
cause, etc.) which will extend the period for the appeal, protest, or 
request for redetermination beyond the date stated or identified in the 
notice of determination.
    (c) That any further information claimant may need or desire can be 
obtained together with assistance in filing his appeal, protest, or 
request for redetermination from the local office.
    If the information is given in separate material, the notice of 
determination would adequately refer to such material if it said, for 
example, ``For other information about your (appeal), (protest), 
(redetermination) rights, see pages ---- to ---- of the ----------------
------------ (name of pamphlet or booklet) heretofore furnished to 
you.''
6014 Separation Information Requirements Designed To Meet Department of 
          Labor Criteria
    A. Information to agency. Where workers are separated, employers are 
required to furnish the agency promptly, either upon agency request or 
upon such separation, a notice describing the reasons for and the 
circumstances of the separation and any additional information which 
might affect a claimant's right to benefits. Where workers are working 
less than full time, employers are required to furnish the agency 
promptly, upon agency request, information concerning a claimant's hours 
of work and his wages during the claim periods invovled, and other facts 
which might affect a claimant's eligibility for benefits during such 
periods.
    When workers are separated and the notices are obtained on a request 
basis, or when workers are working less than full time and the agency 
requests information, it is essential to the prompt processing of claims 
that the request be sent out promptly after the claim is filed and the 
employer be given a specific period within which to return the notice, 
preferably within 2 working days.
    When workers are separated and notices are obtained upon separation, 
it is essential that the empolyer be required to send the notice to the 
agency with sufficient promptness to insure that, if a claim is filed, 
it may be processed promptly. Normally, it is desirable that such a 
notice be sent to the central office of the agency, since the employer 
may not know in which local office the worker will file his claim. The 
usual procedure is for the employer to give the worker a copy of the 
notice sent by the employer to the agency.
    B. Information to worker.

[[Page 78]]

    1. Information required to be given. Employees are required to give 
their employers information and instructions concerning the employees' 
potential rights to benefits and concerning registration for work and 
filing claims for benefits.
    The information furnished to employees under such a requirement need 
not be elaborate; it need only be adequate to insure that the worker who 
is separated or who is working less than full time knows he is 
potentially eligible for benefits and is informed as to what he is to do 
or where he is to go to file his claim and register for work. When he 
files his claim, he can obtain more detailed information.
    In States that do not require employers to furnish periodically to 
the State agency detailed reports of the wages paid to their employees, 
each employer is required to furnish to his employees information as to: 
(a) The name under which he is registered by the State agency, (b) the 
address where he maintains his payroll records, and (c) the workers' 
need for this information if and when they file claims for benefits.
    2. Methods for giving information. The information and instructions 
required above may be given in any of the following ways:
    a. Posters prominently displayed in the employer's establishment. 
The State agency should supply employers with a sufficient number of 
posters for distribution throughout their places of business and should 
see that the posters are conspicuously displayed at all times.
    b. Leaflets. Leaflets distributed either periodically or at the time 
of separation or reduction of hours. The State agency should supply 
employers with a sufficient number of leaflets.
    c. Individual notices. Individual notices given to each employee at 
the time of separation or reduction in hours.
    It is recommended that the State agency's publicity program be used 
to supplement the employer-information requirements. Such a program 
should stress the availability and location of claim-filing offices and 
the importance of visiting those offices whenever the worker is 
unemployed, wishes to apply for benefits, and to seek a job.

6015 Evaluation of Alternative State Provisions with Respect to Claim 
Determinations and Separation Information. If the State law provisions 
do not conform to the suggested requirements set forth in sections 6013 
and 6014, but the State law contains alternative provisions, the Bureau 
of Employment Security, in collaboration with the State agency, will 
study the actual or anticipated effects of the alternative provisions. 
If the Administrator of the Bureau concludes that the alternative 
provisions satisfy the criteria in section 6012, he will so notify the 
State agency. If the Administrator of the Bureau does not so conclude, 
he will submit the matter to the Secretary. If the Secretary concludes 
that the alternative provisions satisfy the criteria in section 6012, 
the State agency will be so notified. If the Secretary concludes that 
there is a question as to whether the alternative provisions satisfy the 
criteria, the State agency will be advised that unless the State law 
provisions are appropriately revised, a notice of hearing will be issued 
as required by the Code of Federal Regulations, title 20,Sec. 601.5.

[53 FR 40557, Oct. 17, 1988; 53 FR 43799, Oct. 26, 1988]



    Sec. Appendix C to Part 614--Standard for Fraud and Overpayment 
                                Detection

         Employment Security Manual (Part V, Sections 7510-7515)

7510-7519 Standard for Fraud and Overpayment Detection

7510 Federal Law Requirements. Section 303(a)(1) of the Social Security 
Act requires that a State law include provision for:
    ``Such methods of administration * * * as are found by the Secretary 
to be reasonably calculated to insure full payment of unemployment 
compensation when due.''
    Section 1603(a)(4) of the Internal Revenue Code and section 
3030(a)(5) of the Social Security Act require that a State law include 
provision for:
    ``Expenditure for all money withdrawn from an unemployment fund of 
such State, in the payment of unemployment compensation * * * ''
    Section 1607(h) of the Internal Revenue Code defines 
``compensation'' as ``cash benefits payable to individuals with respect 
to their unemployment.''

7511 The Secretary's Interpretation of Federal Law Requirements. The 
Secretary of Labor interprets the above sections to require that a State 
law include provision for such methods of administration as are, within 
reason, calculated (1) to detect benefits paid through error by the 
agency or through willful misrepresentation or error by the claimant or 
others, and (2) to deter claimants from obtaining benefits through 
willful misrepresentation.
7513 Criteria for Review of State Conformity With Federal Requirements. 
In detemining State conformity with the above requirements of the 
Internal Revenue Code and the Social Security Act, as interpreted by the 
Secretary of Labor, the following criteria will be applied:
    A. Are investigations required to be made after the payment of 
benefits, (or, in the case of interstate claims, are investigations made 
by the agent State after the processing of claims) as to claimants' 
entitlement to benefits paid to them

[[Page 79]]

in a sufficient proportion of cases to test the effectiveness of the 
agency's procedures for the prevention of payments which are not due? To 
carry out investigations, has the agency assigned to some individual or 
unit, as a basic function, the responsibility of making or functionally 
directing such investigations?
    Explantaion: It is not feasible to prescribe the extent to which the 
above activities are required; however, they should always be carried on 
to such an extent that they will show whether or not error or willful 
misrepresentation is increasing or decreasing, and will reveal problem 
areas. The extent and nature of the above activities should be varied 
according to the seriousness of the problem in the State. The 
responsible individual or unit should:
    1. Check paid claims for overpayment and investigate for willful 
misrepresentation or, alternatively, advise and assist the operating 
units in the performance of such functions, or both;
    2. Perform consultative services with respect to methods and 
procedures for the prevention and detection of fraud; and
    3. Perform other services which are closely related to the above.
    Although a State agency is expected to make a full-time assignment 
of responsibility to a unit or individual to carry on the functions 
described above, a small State agency might make these functions a part-
time responsibility of one individual. In connection with the detection 
of overpayments, such a unit or individual might, for example:
    (a) Investigate information on suspected benefit fraud received from 
any agency personnel, and from sources outside the agency, including 
anonymous complaints;
    (b) Investigate information secured from comparisons of benefit 
payments with employment records to detect cases of concurrent working 
(whether in covered or noncovered work) and claiming of benefits 
(including benefit payments in which the agency acted as agent for 
another State).
    The benefit fraud referred to herein may involve employers, agency 
employees, and witnesses, as well as claimants.
    Comparisons of benefit payments with employment records are commonly 
made either by post-audit or by industry surveys. The so-called ``post-
audit'' is a matching of central office wage-record files against 
benefit payments for the same period. ``Industry surveys'' or ``mass 
audits'' are done in some States by going directly to employers for pay-
roll information to be checked against concurrent benefit lists. A plan
    A. of investigation based on a sample post-audit will be considered 
as partial fulfillment of the investigation program; it would need to be 
supplemented by other methods capable of detecting overpayments to 
persons who have moved into noncovered occupations or are claiming 
interstate benefits.
    B. Are adequate records maintained by which the results of 
investigations may be evaluated? *
---------------------------------------------------------------------------

    * Revises section 7513 as issued 5/5/50.
---------------------------------------------------------------------------

    Explanation. To meet this criterion, the State agency will be 
expected to maintain records of all its activities in the detection of 
overpayments, showing whether attributable to error or willful 
misrepresentation, measuring the results obtained through various 
methods, and noting the remedial action taken in each case. The adequacy 
and effectiveness of various methods of checking for willful 
misrepresentation can be evaluated only if records are kept of the 
results obtained. Internal reports on fraudulent and erroneous 
overpayments are needed by State agencies for self-evaluation. Detailed 
records should be maintained in order that the State agency may 
determine, for example, which of several methods of checking currently 
used are the most productive. Such records also will provide the basis 
for drawing a clear distinction between fraud and error.
    C. Does the agency take adequate action with respect to publicity 
concerning willful misrepresentation and its legal consequences to deter 
fraud by claimants? *
    Explanation. To meet this criterion, the State agency must issue 
adequate material on claimant eligibility requirements and must take 
necessary action to obtain publicity on the legal consequences of 
willful misrepresentation or willful nondisclosure of facts.
    Public announcements on convictions and resulting penalties for 
fraud are generally considered necessary as a deterrent to other 
persons, and to inform the public that the agency is carrying on an 
effective program to prevent fraud. This alone is not considered 
adequate publicity. It is important that information be circulated which 
will explain clearly and understandably the claimant's rights, and the 
obligations which he must fulfill to be eligible for benefits. Leaflets 
for distribution and posters placed in local offices are appropriate 
media for such information.

7515 Evalauation of Alternative State Provisions with Respect to 
Erroneous and Illegal Payments. If the methods of administration 
provided for by the State law do not conform to the suggested methods of 
meeting the requirements set forth in section 7511, but a State law does 
provide for alternative methods of administration designed to accomplish 
the same results, the Bureau of Employment Security, in collaboration 
with the State agency, will study the actual or anticipated effect of 
the alternative methods of administration. If the Bureau concludes that 
the alternative methods satisfy the criteria in section 7513, it will so 
notify the State agency. If the Bureau does not so conclude, it will 
submit to the

[[Page 80]]

Secretary the results of the study for his determination of whether the 
State's alternative methods of administration meet the criteria. \*\
---------------------------------------------------------------------------

    \*\ Revises section 7513 as issued 5/5/50.
---------------------------------------------------------------------------



PART 615_EXTENDED BENEFITS IN THE FEDERAL-STATE UNEMPLOYMENT 
COMPENSATION PROGRAM--Table of Contents



Sec.
615.1 Purpose.
615.2 Definitions.
615.3 Effective period of the program.
615.4 Eligibility requirements for Extended Benefits.
615.5 Definition of ``exhaustee.''
615.6 Extended Benefits; weekly amount.
615.7 Extended Benefits; maximum amount.
615.8 Provisions of State law applicable to claims.
615.9 Restrictions on entitlement.
615.10 Special provisions for employers.
615.11 Extended Benefit Periods.
615.12 Determination of ``on'' and ``off'' indicators.
615.13 Announcement of the beginning and ending of Extended Benefit 
          Periods.
615.14 Payments to States.
615.15 Records and reports.

    Authority: 26 U.S.C. 7805; 42 U.S.C. 1102; Secretary's Order No. 4-
75 (40 FR 18515).

    Source: 53 FR 27937, July 25, 1988, unless otherwise noted.



Sec.  615.1  Purpose.

    The regulations in this part are issued to implement the ``Federal-
State Extended Unemployment Compensation Act of 1970'' as it has been 
amended, which requires, as a condition of tax offset under the Federal 
Unemployment Tax Act (26 U.S.C. 3301 et seq.), that a State unemployment 
compensation law provide for the payment of extended unemployment 
compensation during periods of high unemployment to eligible individuals 
as prescribed in the Act. The benefits provided under State law, in 
accordance with the Act and this part, are hereafter referred to as 
Extended Benefits, and the program is referred to as the Extended 
Benefit Program.



Sec.  615.2  Definitions.

    For the purposes of the Act and this part--
    (a) Act means the ``Federal-State Extended Unemployment Compensation 
Act of 1970'' (title II of Pub. L. 91-373; 84 Stat. 695, 708), approved 
August 10, 1970, as amended from time to time, including the 1980 
amendments in section 416 of Pub. L. 96-364 (94 Stat. 1208, 1310), 
approved September 26, 1980, and in sections 1022 and 1024 of Pub. L. 
96-499 (94 Stat. 2599, 2656, 2658) approved December 5, 1980, and the 
1981 amendments in sections 2401 through 2404 and section 2505(b) of 
Pub. L. 97-35 (95 Stat. 357, 874-875, 884) approved August 13, 1981, and 
the 1982 amendment in section 191 of Pub. L. 97-248 (96 Stat. 324, 407) 
approved September 3, 1982, and the 1983 amendment in section 522 of 
Pub. L. 98-21 (97 Stat. 65, 148) approved April 20, 1983.
    (b) Base period means, with respect to an individual, the base 
period as determined under the applicable State law for the individual's 
applicable benefit year.
    (c)(1) Benefit year means, with respect to an individual, the 
benefit year as defined in the applicable State law.
    (2) Applicable benefit year means, with respect to an individual, 
the current benefit year if, at the time an initial claim for Extended 
Benefits is filed, the individual has an unexpired benefit year only in 
the State in which such claim is filed, or, in any other case, the 
individual's most recent benefit year. For this purpose, the most recent 
benefit year for an individual who has unexpired benefit years in more 
than one State when an initial claim for Extended Benefits is filed, is 
the benefit year with the latest ending date or, if such benefit years 
have the same ending date, the benefit year in which the latest 
continued claim for regular compensation was filed. The individual's 
most recent benefit year which expires in an Extended Benefit Period is 
the applicable benefit year if the individual cannot establish a second 
benefit year or is precluded from receiving regular compensation in a 
second benefit year solely by reason of a State law provision which 
meets the requirement of section 3304(a)(7) of the Internal Revenue Code 
of 1986 (26 U.S.C. 3304(a)(7)).

[[Page 81]]

    (d) Compensation and unemployment compensation means cash benefits 
(including dependents' allowances) payable to individuals with respect 
to their unemployment, and includes regular compensation, additional 
compensation and extended compensation as defined in this section.
    (e) Regular compensation means compensation payable to an individual 
under a State law, and, when so payable, includes compensation payable 
pursuant to 5 U.S.C. chapter 85, but does not include extended 
compensation or additional compensation.
    (f) Additional compensation means compensation totally financed by a 
State and payable under a State law by reason of conditions of high 
unemployment or by reason of other special factors and, when so payable, 
includes compensation payable pursuant to 5 U.S.C. chapter 85.
    (g) Extended compensation means the extended unemployment 
compensation payable to an individual for weeks of unemployment which 
begin in an Extended Benefit Period, under those provisions of a State 
law which satisfy the requirements of the Act and this part with respect 
to the payment of extended unemployment compensation, and, when so 
payable, includes compensation payable pursuant to 5 U.S.C. chapter 85, 
but does not include regular compensation or additional compensation. 
Extended compensation is referred to in this part as Extended Benefits.
    (h) Eligibility period means, with respect to an individual, the 
period consisting of--
    (1) The weeks in the individual's applicable benefit year which 
begin in an Extended Benefit Period, or with respect to a single benefit 
year, the weeks in the benefit year which begin in more than one 
Extended Benefit Period, and
    (2) If the applicable benefit year ends within an Extended Benefit 
Period, any weeks thereafter which begin in such Extended Benefit 
Period, but an individual may not have more than one eligibility period 
with respect to any one exhaustion of regular benefits, or carry over 
from one eligibility period to another any entitlement to Extended 
Benefits.
    (i) Sharable compensation means:
    (1) Extended Benefits paid to an eligible individual under those 
provisions of a State law which are consistent with the Act and this 
part, and that does not exceed the smallest of the following:
    (i) 50 percent of the total amount of regular compensation payable 
to the individual during the applicable benefit year; or
    (ii) 13 times the individual's weekly amount of Extended Benefits 
payable for a week of total unemployment, as determined pursuant to 
Sec.  615.6(a); or
    (iii) 39 times the individual's weekly benefit amount, referred to 
in (ii), reduced by the regular compensation paid (or deemed paid) to 
the individual during the applicable benefit year; and
    (2) Regular compensation paid to an eligible individual with respect 
to weeks of unemployment in the individual's eligibility period, but 
only to the extent that the sum of such compensation, plus the regular 
compensation paid (or deemed paid) to the individual with respect to 
prior weeks of unemployment in the applicable benefit year, exceeds 26 
times and does not exceed 39 times the average weekly benefit amount 
(including allowances for dependents) for weeks of total unemployment 
payable to the individual under the State law in such benefit year: 
Provided, that such regular compensation is paid under provisions of a 
State law which are consistent with the Act and this part.
    (3) Notwithstanding the preceding provisions of this paragraph, 
sharable compensation shall not include any regular or extended 
compensation with respect to which a State is not entitled to a payment 
under section 202(a)(6) or 204 of the Act orSec. 615.14 of this part.
    (j)(1) Secretary means the Secretary of Labor of the United States.
    (2) Department means the United States Department of Labor, and 
shall include the Employment and Training Administration, the agency of 
the United States Department of Labor headed by the Assistant Secretary 
of Labor for Employment and Training to whom has been delegated the 
Secretary's authority under the Act in Secretary's Order No. 4-75 (40 FR 
18515) and Secretary's Order No. 14-75.

[[Page 82]]

    (k)(1) State means the States of the United States, the District of 
Columbia, the Commonwealth of Puerto Rico, and the U. S. Virgin Islands.
    (2) Applicable State means, with respect to an individual, the State 
with respect to which the individual is an ``exhaustee'' as defined in 
Sec.  615.5, and in the case of a combined wage claim for regular 
compensation, the term means the ``paying State'' as defined inSec. 
616.6(e) of this chapter.
    (3) State agency means the State unemployment compensation agency of 
a State which administers the State law.
    (l)(1) State law means the unemployment compensation law of a State, 
approved by the Secretary under section 3304(a) of the Internal Revenue 
Code of 1986 (26 U.S.C. 3304(a)).
    (2) Applicable State law means the law of the State which is the 
applicable State for an individual.
    (m)(1) Week means, for purposes of eligibility for and payment of 
Extended Benefits, a week as defined in the applicable State law.
    (2) Week means, for purposes of computation of Extended Benefit 
``on'' and ``off'' and ``no change'' indicators and insured unemployment 
rates and the beginning and ending of Extended Benefit Periods, a 
calendar week.
    (n)(1) Week of unemployment means a week of total, part-total, or 
partial unemployment as defined in the applicable State law, which shall 
be applied in the same manner and to the same extent to the Extended 
Benefit Program as if the individual filing a claim for Extended 
Benefits were filing a claim for regular compensation, except as 
provided in paragraph (n)(2) of this section.
    (2) Week of unemployment in section 202(a)(3)(A) of the Act means a 
week of unemployment, as defined in paragraph (n)(1) of this section, 
for which the individual claims Extended Benefits or sharable regular 
benefits.
    (o) For the purposes of section 202(a)(3) of the Act--
    (1) Employed, for the purposes of section 202(a)(3)(B)(ii) of the 
Act, and employment, for the purposes of section 202(a)(4) of the Act, 
means service performed in an employer-employee relationship as defined 
in the State law; and that law also shall govern whether that service 
must be covered by it, must consist of consecutive weeks, and must 
consist of more weeks of work than are required under section 
202(a)(3)(B) of the Act;
    (2) Individual's capabilities, for the purposes of section 
202(a)(3)(C), means work which the individual has the physical and 
mental capacity to perform and which meets the minimum requirements of 
section 202(a)(3)(D);
    (3) Reasonably short period, for the purposes of section 
202(a)(3)(C), means the number of weeks provided by the applicable State 
law;
    (4) Average weekly benefit amount, for the purposes of section 
202(a)(3)(D)(i), means the weekly benefit amount (including dependents' 
allowances payable for a week of total unemployment and before any 
reduction because of earnings, pensions or other requirements) 
applicable to the week in which the individual failed to take an action 
which results in a disqualification as required by section 202(a)(3)(B) 
of the Act;
    (5) Gross average weekly remuneration, for the purposes of section 
202(a)(3)(D)(i), means the remuneration offered for a week of work 
before any deductions for taxes or other purposes and, in case the 
offered pay may vary from week to week, it shall be determined on the 
basis of recent experience of workers performing work similar to the 
offered work for the employer who offered the work;
    (6) And, as used in section 202(a)(3)(D)(ii), shall be interpreted 
to mean ``or'';
    (7) Provisions of the applicable State law, as used in section 
202(a)(3)(D)(iii), include statutory provisions and decisions based on 
statutory provisions, such as not requiring an individual to take a job 
which requires traveling an unreasonable distance to work, or which 
involves an unreasonable risk to the individual's health, safety or 
morals; and such provisions shall also include labor standards and 
training provisions required under sections 3304(a)(5) and 3304(a)(8) of 
the Internal Revenue Code of 1986 and section 236(e) of the Trade Act of 
1974;
    (8) A systematic and sustained effort, for the purposes of section 
202(a)(3)(E), means--

[[Page 83]]

    (i) A high level of job search activity throughout the given week, 
compatible with the number of employers and employment opportunities in 
the labor market reasonably applicable to the individual,
    (ii) A plan of search for work involving independent efforts on the 
part of each individual which results in contacts with persons who have 
the authority to hire or which follows whatever hiring procedure is 
required by a prospective employer in addition to any search offered by 
organized public and private agencies such as the State employment 
service or union or private placement offices or hiring halls,
    (iii) Actions by the individual comparable to those actions by which 
jobs are being found by people in the community and labor market, but 
not restricted to a single manner of search for work such as registering 
with and reporting to the State employment service and union or private 
placement offices or hiring halls, in the same manner that such work is 
found by people in the community,
    (iv) A search not limited to classes of work or rates of pay to 
which the individual is accustomed or which represent the individual's 
higher skills, and which includes all types of work within the 
individual's physical and mental capabilities, except that the 
individual, while classified by the State agency as provided inSec. 
615.8(d) as having ``good'' job prospects, shall search for work that is 
suitable work under State law provisions which apply to claimants for 
regular compensation (which is not sharable),
    (v) A search by every claimant, without exception for individuals or 
classes of individuals other than those in approved training, as 
required under section 3304(a)(8) of the Internal Revenue Code of 1986 
or section 236(e) of the Trade Act of 1974,
    (vi) A search suspended only when severe weather conditions or other 
calamity forces suspension of such activities by most members of the 
community, except that
    (vii) The individual, while classified by the State agency as 
provided inSec. 615.8(d) as having ``good'' job prospects, if such 
individual normally obtains customary work through a hiring hall, shall 
search for work that is suitable work under State law provisions which 
apply to claimants for regular compensation (which is not sharable);
    (9) Tangible evidence of an active search for work, for the purposes 
of section 202(a)(3)(E), means a written record which can be verified, 
and which includes the actions taken, methods of applying for work, 
types of work sought, dates and places where work was sought, the name 
of the employer or person who was contacted and the outcome of the 
contact;
    (10) Date of a disqualification, as used in section 202(a)(4), means 
the date the disqualification begins, as determined under the applicable 
State law;
    (11) Jury duty, for purposes of section 202(a)(3)(A)(ii), means the 
performance of service as a juror, during all periods of time an 
individual is engaged in such service, in any court of a State or the 
United States pursuant to the law of the State or the United States and 
the rules of the court in which the individual is engaged in the 
performance of such service; and
    (12) Hospitalized for treatment of an emergency or life-threatening 
condition, as used in section 202(a)(3)(A)(ii), has the following 
meaning: ``Hospitalized for treatment'' means an individual was admitted 
to a hospital as an inpatient for medical treatment. Treatment is for an 
``emergency or life threatening condition'' if determined to be such by 
the hospital officials or attending physician that provide the treatment 
for a medical condition existing upon or arising after hospitalization. 
For purposes of this definition, the term ``medical treatment'' refers 
to the application of any remedies which have the objective of effecting 
a cure of the emergency or life-threatening condition. Once an 
``emergency condition'' or a ``life-threatening condition'' has been 
determined to exist by the hospital officials or attending physician, 
the status of the individual as so determined shall remain unchanged 
until release from the hospital.
    (p)(1) Claim filed in any State under the interstate benefit payment 
plan, as used in section 202(c), means any interstate claim for a week 
of unemployment filed pursuant to the Interstate Benefit Payment Plan, 
but does not include--

[[Page 84]]

    (i) A claim filed in Canada,
    (ii) A visiting claim filed by an individual who has received 
permission from his/her regular reporting office to report temporarily 
to a local office in another State and who has been furnished intrastate 
claim forms on which to file claims, or
    (iii) A transient claim filed by an individual who is moving from 
place to place searching for work, or an intrastate claim for Extended 
Benefits filed by an individual who does not reside in a State that is 
in an Extended Benefit Period,
    (2) The first 2 weeks, as used in section 202(c), means the first 
two weeks for which the individual files compensable claims for Extended 
Benefits under the Interstate Benefit Payment Plan in an agent State in 
which an Extended Benefit Period is not in effect during such weeks, and
    (q) Benefit structure as used in section 204(a)(2)(D), for the 
requirement to round down to the ``nearest lower full dollar amount'' 
for Federal reimbursement of sharable regular and sharable extended 
compensation means all of the following:
    (1) Amounts of regular weekly benefit payments,
    (2) Amounts of additional and extended weekly benefit payments,
    (3) The State maximum or minimum weekly benefit,
    (4) Partial and part-total benefit payments,
    (5) Amounts payable after deduction for pensions, and
    (6) Amounts payable after any other deduction required by State law.

[53 FR 27937, July 25, 1988, as amended at 71 FR 35514, June 21, 2006]



Sec.  615.3  Effective period of the program.

    An Extended Benefit Program conforming with the Act and this part 
shall be a requirement for a State law effective on and after January 1, 
1972, pursuant to section 3304(a)(11) of the Internal Revenue Code of 
1986, (26 U.S.C. 3304(a)(11)). Continuation of the program by a State in 
conformity and substantial compliance with the Act and this part, 
throughout any 12-month period ending on October 31 of a year subsequent 
to 1972, shall be a condition of the certification of the State with 
respect to such 12-month period under section 3304(c) of the Internal 
Revenue Code of 1986 (26 U.S.C. 3304(c)). Conformity with the Act and 
this part in the payment of regular compensation and Extended Benefits 
to any individual shall be a continuing requirement, applicable to every 
week as a condition of a State's entitlement to payment for any 
compensation as provided in the Act and this part.



Sec.  615.4  Eligibility requirements for Extended Benefits.

    (a) General. An individual is entitled to Extended Benefits for a 
week of unemployment which begins in the individual's eligibility period 
if, with respect to such week, the individual is an exhaustee as defined 
inSec. 615.5, files a timely claim for Extended Benefits, and 
satisfies the pertinent requirements of the applicable State law which 
are consistent with the Act and this part.
    (b) Qualifying for Extended Benefits. The State law shall specify 
whether an individual qualifies for Extended Benefits by earnings and 
employment in the base period for the individual's applicable benefit 
year as required by section 202(a)(5) of the Act, (and if it does not 
also apply this requirement to the payment of sharable regular benefits, 
the State will not be entitled to a payment underSec. 615.14), as 
follows:
    (1) One and one-half times the high quarter wages; or
    (2) Forty times the most recent weekly benefit amount, and if this 
alternative is adopted, it shall use the weekly benefit amount 
(including dependents' allowances) payable for a week of total 
unemployment (before any reduction because of earnings, pensions or 
other requirements) which applied to the most recent week of regular 
benefits; or
    (3) Twenty weeks of full-time insured employment, and if this 
alternative is adopted, the term ``full-time'' shall have the meaning 
provided by the State law.



Sec.  615.5  Definition of ``exhaustee.''

    (a)(1) ``Exhaustee'' means an individual who, with respect to any 
week

[[Page 85]]

of unemployment in the individual's eligibility period:
    (i) Has received, prior to such week, all of the regular 
compensation that was payable under the applicable State law or any 
other State law (including regular compensation payable to Federal 
civilian employees and Ex-Servicemembers under 5 U.S.C. chapter 85) for 
the applicable benefit year that includes such week; or
    (ii) Has received, prior to such week, all of the regular 
compensation that was available under the applicable State law or any 
other State law (including regular compensation available to Federal 
civilian employees and Ex-Servicemembers under 5 U.S.C. chapter 85) in 
the benefit year that includes such week, after the cancellation of some 
or all of the individual's wage credits or the total or partial 
reduction of the individual's right to regular compensation; or
    (iii) The applicable benefit year having expired prior to such week 
and the individual is precluded from establishing a second (new) benefit 
year, or the individual established a second benefit year but is 
suspended indefinitely from receiving regular compensation, solely by 
reason of a State law provision which meets the requirement of section 
3304(a)(7) of the Internal Revenue Code of 1986 (26 U.S.C. 3304(a)(7)): 
Provided, that, an individual shall not be entitled to Extended Benefits 
based on regular compensation in a second benefit year during which the 
individual is precluded from receiving regular compensation solely by 
reason of a State law provision which meets the requirement of section 
3304(a)(7) of the Internal Revenue Code of 1986 (26 U.S.C. 3304(a)(7)); 
or
    (iv) The applicable benefit year having expired prior to such week, 
the individual has insufficient wages or employment, or both, on the 
basis of which a new benefit year could be established in any State that 
would include such week; and
    (v) Has no right to unemployment compensation for such week under 
the Railroad Unemployment Insurance Act or such other Federal laws as 
are specified by the Department pursuant to this paragraph; and
    (vi) Has not received and is not seeking for such week unemployment 
compensation under the unemployment compensation law of Canada, unless 
the Canadian agency finally determines that the individual is not 
entitled to unemployment compensation under the Canadian law for such 
week.
    (2) An individual who becomes an exhaustee as defined above shall 
cease to be an exhaustee commencing with the first week that the 
individual becomes eligible for regular compensation under any State law 
or 5 U.S.C. chapter 85, or has any right to unemployment compensation as 
provided in paragraph (a)(1)(v) of this section, or has received or is 
seeking unemployment compensation as provided in paragraph (a)(1)(vi) of 
this section. The individual's Extended Benefit Account shall be 
terminated upon the occurrence of any such week, and the individual 
shall have no further right to any balance in that Extended Benefit 
Account.
    (b) Special Rules. For the purposes of paragraphs (a)(1)(i) and 
(a)(1)(ii) of this section, an individual shall be deemed to have 
received in the applicable benefit year all of the regular compensation 
payable according to the monetary determination, or available to the 
individual, as the case may be, even though--
    (1) As a result of a pending appeal with respect to wages or 
employment or both that were not included in the original monetary 
determination with respect to such benefit year, the individual may 
subsequently be determined to be entitled to more or less regular 
compensation, or
    (2) By reason of a provision in the State law that establishes the 
weeks of the year in which regular compensation may be paid to the 
individual on the basis of wages in seasonal employment--
    (i) The individual may be entitled to regular compensation with 
respect to future weeks of unemployment in the next season or off 
season, as the case may be, but such compensation is not payable with 
respect to the week of unemployment for which Extended Benefits are 
claimed, and
    (ii) The individual is otherwise an exhaustee within the meaning of 
this

[[Page 86]]

section with respect to rights to regular compensation during the season 
or off season in which that week of unemployment occurs, or
    (3) Having established a benefit year, no regular compensation is 
payable during such year because wage credits were cancelled or the 
right to regular compensation was totally reduced as the result of the 
application of a disqualification.
    (c) Adjustment of week. If it is subsequently determined as the 
result of a redetermination or appeal that an individual is an exhaustee 
as of a different week than was previously determined, the individual's 
rights to Extended Benefits shall be adjusted so as to accord with such 
redetermination or decision.

[53 FR 27937, July 25, 1988, as amended at 71 FR 35514, June 21, 2006]



Sec.  615.6  Extended Benefits; weekly amount.

    (a) Total unemployment. (1) The weekly amount of Extended Benefits 
payable to an individual for a week of total unemployment in the 
individual's eligibility period shall be the amount of regular 
compensation payable to the individual for a week of total unemployment 
during the applicable benefit year. If the individual had more than one 
weekly amount of regular compensation for total unemployment during such 
benefit year, the weekly amount of extended compensation for total 
unemployment shall be one of the following which applies as specified in 
the applicable State law:
    (i) The average of such weekly amounts of regular compensation,
    (ii) The last weekly benefit amount of regular compensation in such 
benefit year, or
    (iii) An amount that is reasonably representative of the weekly 
amounts of regular compensation payable during such benefit year.
    (2) If the method in paragraph (a)(1)(iii) of this section is 
adopted by a State, the State law shall specify how such amount is to be 
computed. If the method in paragraph (a)(1)(i) of this section is 
adopted by a State, and the amount computed is not an even dollar 
amount, the amount shall be raised or lowered to an even dollar amount 
as provided by the applicable State law for regular compensation.
    (b) Partial and part-total unemployment. The weekly amount of 
Extended Benefits payable for a week of partial or part-total 
unemployment shall be determined under the provisions of the applicable 
State law which apply to regular compensation, computed on the basis of 
the weekly amount of Extended Benefits payable for a week of total 
unemployment as determined pursuant to paragraph (a) of this section.



Sec.  615.7  Extended Benefits; maximum amount.

    (a) Individual account. An Extended Benefit Account shall be 
established for each individual determined to be eligible for Extended 
Benefits, in the sum of the maximum amount potentially payable to the 
individual as computed in accordance with paragraph (b) of this section.
    (b) Computation of amount in individual account. (1) The amount 
established in the Extended Benefit Account of an individual, as the 
maximum amount potentially payable to the individual during the 
individual's eligibility period, shall be equal to the lesser of--
    (i) 50 percent of the total amount of regular compensation 
(including dependents' allowances) payable to the individual during the 
individual's applicable benefit year; or
    (ii) 13 times the individual's weekly amount of Extended Benefits 
payable for a week of total unemployment, as determined pursuant to 
Sec.  615.6(a); or
    (iii) 39 times the individual's weekly benefit amount referred to in 
(ii), reduced by the regular compensation paid (or deemed paid) to the 
individual during the individual's applicable benefit year.
    (2) If the State law so provides, the amount in the individual's 
Extended Benefit Account shall be reduced by the aggregate amount of 
additional compensation paid (or deemed paid) to the individual under 
such law for prior weeks of unemployment in such benefit year which did 
not begin in an Extended Benefit Period.

[[Page 87]]

    (c) Changes in accounts. (1) If an individual is entitled to more or 
less Extended Benefits as a result of a redetermination or an appeal 
which awarded more or less regular compensation or Extended Benefits, an 
appropriate change shall be made in the individual's Extended Benefit 
Account pursuant to an amended determination of the individual's 
entitlement to Extended Benefits.
    (2) If an individual who has received Extended Benefits for a week 
of unemployment is determined to be entitled to more regular 
compensation with respect to such week as the result of a 
redetermination or an appeal, the Extended Benefits paid shall be 
treated as if they were regular compensation up to the greater amount to 
which the individual has been determined to be entitled, and the State 
agency shall make appropriate adjustments between the regular and 
extended accounts. If the individual is entitled to more Extended 
Benefits as a result of being entitled to more regular compensation, an 
amended determination shall be made of the individual's entitlement to 
Extended Benefits. If the greater amount of regular compensation results 
in an increased duration of regular compensation, the individual's 
status as an exhaustee shall be redetermined as of the new date of 
exhaustion of regular compensation.
    (3) If an individual who has received Extended Benefits for a week 
of unemployment is determined to be entitled to less regular 
compensation as the result of a redetermination or an appeal, and as a 
consequence is entitled to less Extended Benefits, any Extended Benefits 
paid in excess of the amount to which the individual is determined to be 
entitled after the redetermination or decision on appeal shall be 
considered an overpayment which the individual shall have to repay on 
the same basis and in the same manner that excess payments of regular 
compensation are required to be repaid under the applicable State law. 
If such decision reduces the duration of regular compensation payable to 
the individual, the claim for Extended Benefits shall be backdated to 
the earliest date, subsequent to the date when the redetermined regular 
compensation was exhausted and within the individual's eligibility 
period, that the individual was eligible to file a claim for Extended 
Benefits. Any such changes shall be made pursuant to an amended 
determination of the individual's entitlement to Extended Benefits.
    (d) Reduction because of trade readjustment allowances. Section 
233(d) of the Trade Act of 1974 (and section 204(a)(2)(C) of the Act), 
requiring a reduction of Extended Benefits because of the receipt of 
trade readjustment allowances, shall be applied as follows:
    (1) The reduction of Extended Benefits shall apply only to an 
individual who has not exhausted his/her Extended Benefits at the end of 
the benefit year;
    (2) The amount to be deducted is the product of the weekly benefit 
amount for Extended Benefits multiplied by the number of weeks for which 
trade readjustment allowances were paid (regardless of the amount paid 
for any such week) up to the close of the last week that begins in the 
benefit year; and
    (3) The amount to be deducted shall be deducted from the balance of 
Extended Benefits not used as of the close of the last week which begins 
in the benefit year.



Sec.  615.8  Provisions of State law applicable to claims.

    (a) Particular provisions applicable. Except where the result would 
be inconsistent with the provisions of the Act or this part, the terms 
and conditions of the applicable State law which apply to claims for, 
and the payment of, regular compensation shall apply to claims for, and 
the payment of, Extended Benefits. The provisions of the applicable 
State law which shall apply to claims for, and the payment of, Extended 
Benefits include, but are not limited to:
    (1) Claim filing and reporting;
    (2) Information to individuals, as appropriate;
    (3) Notices to individuals and employers, as appropriate;
    (4) Determinations, redeterminations, and appeal and review;
    (5) Ability to work and availability for work, except as provided 
otherwise in this section;

[[Page 88]]

    (6) Disqualifications, including disqualifying income provisions, 
except as provided by paragraph (c) of this section;
    (7) Overpayments, and the recovery thereof;
    (8) Administrative and criminal penalties;
    (9) The Interstate Benefit Payment Plan;
    (10) The Interstate Arrangement for Combining Employment and Wages, 
in accordance with part 616 of this chapter.
    (b) Provisions not to be applicable. The State law and regulations 
shall specify those of its terms and conditions which shall not be 
applicable to claims for, or payment of, Extended Benefits. Among such 
terms and conditions shall be at least those relating to--
    (1) Any waiting period;
    (2) Monetary or other qualifying requirements, except as provided in 
Sec.  615.4(b); and
    (3) Computation of weekly and total regular compensation.
    (c) Terminating disqualifications. A disqualification in a State 
law, as to any individual who voluntarily left work, was suspended or 
discharged for misconduct, gross misconduct or the commission or 
conviction of a crime, or refused an offer of or a referral to work, as 
provided in sections 202(a) (4) and (6) of the Act--
    (1) As applied to regular benefits which are not sharable, is not 
subject to any limitation in sections 202(a) (4) and (6);
    (2) As applied to eligibility for Extended Benefits, shall require 
that the individual be employed again subsequent to the date of the 
disqualification before it may be terminated, even though it may have 
been terminated on other grounds for regular benefits which are not 
sharable; and if the State law does not also apply this provision to the 
payment of what would otherwise be sharable regular benefits, the State 
will not be entitled to a payment under the Act andSec. 615.14 in 
regard to such regular compensation; and
    (3) Will not apply in regard to eligibility for Extended Benefits in 
a subsequent eligibility period.
    (d) Classification and determination of job prospects. (1) As to 
each individual who files an initial claim for Extended Benefits (or 
sharable regular compensation), the State agency shall classify the 
individual's prospects for obtaining work in his/her customary 
occupation within a reasonably short period, as ``good'' or ``not 
good,'' and shall promptly (not later than the end of the week in which 
the initial claim is filed) notify the individual in writing of such 
classification and of the requirements applicable to the individual 
under the provisions of the applicable State law corresponding to 
section 202(a)(3) of the Act and this part. Such requirements shall be 
applicable beginning with the week following the week in which the 
individual is furnished such written notice.
    (2) If an individual is thus classified as having good prospects, 
but those prospects are not realized by the close of the period the 
State law specifies as a reasonably short period, the individual's 
prospects will be automatically reclassified as ``not good'' or 
classified as ``good'' or ``not good'' depending on the individual's job 
prospects as of that date.
    (3) Whenever, as part of a determination of an individual's 
eligibility for benefits, an issue arises concerning the individual's 
failure to apply for or accept an offer of work (sections 
202(a)(3)(A)(i) and (F) of the Act and paragraphs (e) and (f) of this 
section), or to actively engage in seeking work (sections 
202(a)(3)(A)(ii) and (E) of the Act and paragraph (g) of this section), 
a written appealable determination shall be made which includes a 
finding as to the individual's job prospects at the time the issue 
arose. The reasons for allowing or denying benefits in the written 
notice of determination shall explain how the individual's job prospects 
relate to the decision to allow or deny benefits.
    (4) If an individual's job prospects are determined in accordance 
with the preceding paragraph (3) to be ``good,'' the suitability of work 
will be determined under the standard State law provisions applicable to 
claimants for regular compensation which is not sharable; and if 
determined to be ``not good,'' the suitability of work will be 
determined under the definition of

[[Page 89]]

suitable work in the State law provisions corresponding to sections 
202(a)(3) (C) and (D) of the Act and this part. Any determination or 
classification of an individual's job prospects is mutually exclusive, 
and only one suitable work definition shall be applied to a claimant as 
to any failure to accept or apply for work or seek work with respect to 
any week.
    (e) Requirement of referral to work. (1) The State law shall 
provide, as required by section 202(a)(3)(F) of the Act and this part, 
that the State Workforce Agency shall refer every claimant for Extended 
Benefits to work which is ``suitable work'' as provided in paragraph 
(d)(4) of this section, beginning with the week following the week in 
which the individual is furnished a written notice of classification of 
job prospects as required by paragraphs (d)(1) and (h) of this section.
    (2) To make such referrals, the State Workforce Agency shall assure 
that each Extended Benefit claimant is registered for work and continues 
to be considered for referral to job openings as long as he/she 
continues to claim benefits.
    (3) In referring claimants to available job openings, the State 
Workforce Agency shall apply to Extended Benefit claimants the same 
priorities, policies, and judgments as it does to other applicants, 
except that it shall not restrict referrals only to work at higher skill 
levels, prior rates of pay, customary work, or preferences as to work or 
pay for individuals whose prospects of obtaining work in their customary 
occupations have been classified as or determined to be ``not good.''
    (4) For referral purposes, any work which does not exceed the 
individual's capabilities shall be considered suitable work for an 
Extended Benefit claimant whose job prospects have been classified as or 
determined to be ``not good'', except as modified by this paragraph (e).
    (5) For Extended Benefit claimants whose prospects of obtaining work 
in their customary occupations have been classified as or determined to 
be ``not good'', work shall not be suitable, and referral to a job shall 
not be made, if--
    (i) The gross average weekly remuneration for the work for any week 
does not exceed the sum of the individual's weekly benefit amount plus 
any supplemental unemployment benefits (SUB) (as defined in section 
501(c)(17)(D) of the Internal Revenue Code of 1986) payable to the 
individual,
    (ii) The work is not offered in writing or is not listed with the 
State employment service,
    (iii) The work pays less than the higher of the minimum wage set in 
section 6(a)(1) of the Fair Labor Standards Act of 1938, without regard 
to any exemption, or any applicable State or local minimum wage, or
    (iv) Failure to accept or apply for the work would not result in a 
denial of compensation under the provisions of the applicable State law 
as defined inSec. 615.2(o)(7).
    (6) In addition, if the State Workforce Agency classifies or 
determines that an individual's prospects for obtaining work in his/her 
customary occupation within a reasonably short period are ``good,'' 
referral shall not be made to a job if such referral would not be made 
under the State law provisions applicable to claimants for regular 
benefits which are not sharable, and such referrals shall be limited to 
work which the individual is required to make a ``systematic and 
sustained effort'' to search for as defined inSec. 615.2(o)(8).
    (7) For the purposes of the foregoing paragraphs of this paragraph 
(e), State law applies regarding whether members of labor organizations 
shall be referred to nonunion work in their customary occupations.
    (8) If the State law does not also apply this paragraph (e) to 
individuals who claim what would otherwise be sharable regular 
compensation, the State will not be entitled to payment under the Act 
andSec. 615.14 in regard to such regular compensation.
    (f) Refusal of work. (1) The State law shall provide, as required by 
section 202(a)(3)(A)(i) of the Act and this part, that if an individual 
who claims Extended Benefits fails to accept an offer of work or fails 
to apply for work to which he/she was referred by the State Workforce 
Agency--
    (i) If the individual's prospects for obtaining work in his/her 
customary occupation within a reasonably short

[[Page 90]]

period are determined to be ``good,'' the State agency shall determine 
whether the work is suitable under the standard State law provisions 
which apply to claimants for regular compensation which is not sharable, 
and if determined to be suitable the individual shall be ineligible for 
Extended Benefits for the week in which the individual fails to apply 
for or accept an offer of suitable work and thereafter until the 
individual is employed in at least four weeks with wages from such 
employment totalling not less than four times the individual's weekly 
benefit amount, as provided by the applicable State law; or
    (ii) If the individual's prospects for obtaining work in his/her 
customary occupation are determined to be ``not good,'' the State agency 
shall determine whether the work is suitable under the applicable State 
law provisions corresponding to sections 202(a)(3) (C) and (D) of the 
Act and paragraphs (e)(5) and (f)(2) of this section, and if determined 
to be suitable the individual shall be ineligible for Extended Benefits 
for the week in which the individual fails to apply for or accept an 
offer of suitable work and thereafter until the individual is employed 
in at least four weeks with wages from such employment totalling not 
less than four times the individual's weekly benefit amount, as provided 
by the applicable State law.
    (2) For an individual whose prospects of obtaining work in his/her 
customary occupation within the period specified by State law are 
classified or determined to be ``not good,'' the term ``suitable work'' 
shall mean any work which is within the individual's capabilities, 
except that work shall not be suitable if--
    (i) The gross average weekly remuneration for the work for any week 
does not exceed the sum of the individual's weekly benefit amount plus 
any supplemental unemployment benefits (SUB) (as defined in section 
501(c)(17)(D) of the Internal Revenue Code of 1986) payable to the 
individual,
    (ii) The work is not offered in writing or is not listed with the 
State employment service,
    (iii) The work pays less than the higher of the minimum wage set in 
section 6(a)(1) of the Fair Labor Standards Act of 1938, without regard 
to any exemption, or any applicable State or local minimum wage, or
    (iv) Failure to accept or apply for the work would not result in a 
denial of compensation under the provisions of the applicable State law 
as defined inSec. 615.2(o)(7).
    (3) For the purposes of the foregoing paragraphs of this paragraph 
(f), State law applies regarding whether members of labor organizations 
shall be referred to nonunion work in their customary occupations.
    (4) If the State law does not also apply this paragraph (f) to 
individuals who claim what would otherwise be sharable regular 
compensation, the State will not be entitled to payment under the Act 
andSec. 615.14 in regard to such regular compensation.
    (g) Actively seeking work. (1) The State law shall provide, as 
required by sections 202(a)(3) (A)(ii) and (E) of the Act and this part, 
that an individual who claims Extended Benefits shall be required to 
make a systematic and sustained effort (as defined inSec. 615.2(o)(8)) 
to search for work which is ``suitable work'' as provided in paragraph 
(d)(4) of this section, throughout each week beginning with the week 
following the week in which the individual is furnished a written notice 
of classification of job prospects as required by paragraphs (d)(1) and 
(h) of this section, and to furnish to the State agency with each claim 
tangible evidence of such efforts.
    (2) If the individual fails to thus search for work, or to furnish 
tangible evidence of such efforts, he/she shall be ineligible for 
Extended Benefits for the week in which the failure occurred and 
thereafter until the individual is employed in at least four weeks with 
wages from such employment totalling not less than four times the 
individual's weekly benefit amount, as provided by the applicable State 
law.
    (3)(i) A State law may provide that eligibility for Extended 
Benefits be determined under the applicable provisions of State law for 
regular compensation which is not sharable, without regard to the active 
search provisions otherwise applicable in paragraph (g)(1) of this 
section, for any individual

[[Page 91]]

who fails to engage in a systematic and sustained search for work 
throughout any week because such individual is--
    (A) Serving on jury duty, or
    (B) Hospitalized for treatment of an emergency or life-threatening 
condition.
    (ii) The conditions in (i) (A) and (B) must be applied to 
individuals filing claims for Extended Benefits in the same manner as 
applied to individuals filing claims for regular compensation which is 
not sharable compensation.
    (4) For the purposes of the foregoing paragraphs of this paragraph 
(g), State law applies regarding whether members of labor organizations 
shall be required to seek nonunion work in their customary occupations.
    (5) If the State law does not also apply this paragraph (g) to 
individuals who claim what would otherwise be sharable regular 
compensation, the State will not be entitled to payment under the Act 
andSec. 615.14 in regard to such regular compensation.
    (h) Information to claimants. The State agency or State Workforce 
Agency, as applicable, shall assure that each Extended Benefit claimant 
(and claimant for sharable regular compensation) is informed in 
writing--
    (1) Of the State agency's classification of his/her prospects for 
finding work in his/her customary occupation within the time set out in 
paragraph (d) as ``good'' or ``not good,''
    (2) What kind of jobs he/she may be referred to, depending on the 
classification of his/her job prospects,
    (3) What kind of jobs he/she must be actively engaged in seeking 
each week depending on the classification of his/her job prospects, and 
what tangible evidence of such search must be furnished to the State 
agency with each claim for benefits, and
    (4) The resulting disqualification if he/she fails to apply for work 
to which referred, or fails to accept work offered, or fails to actively 
engage in seeking work or to furnish tangible evidence of such search 
for each week for which Extended Benefits or sharable regular benefits 
are claimed, beginning with the week following the week in which such 
information is furnished in writing to the individual.

[53 FR 27937, July 25, 1988, as amended at 71 FR 35514, June 21, 2006]



Sec.  615.9  Restrictions on entitlement.

    (a) Disqualifications. If the week of unemployment for which an 
individual claims Extended Benefits is a week to which a 
disqualification for regular compensation applies, including a reduction 
because of the receipt of disqualifying income, or would apply but for 
the fact that the individual has exhausted all rights to such 
compensation, the individual shall be disqualified in the same degree 
from receipt of Extended Benefits for that week.
    (b) Additional compensation. No individual shall be paid additional 
compensation and Extended Benefits with respect to the same week. If 
both are payable by a State with respect to the same week, the State law 
may provide for the payment of Extended Benefits instead of additional 
compensation with respect to the week. If Extended Benefits are payable 
to an individual by one State and additional compensation is payable to 
the individual for the same week by another State, the individual may 
elect which of the two types of compensation to claim.
    (c) Interstate claims. An individual who files claims for Extended 
Benefits under the Interstate Benefit Payment Plan, in a State which is 
not in an Extended Benefit Period for the week(s) for which Extended 
Benefits are claimed, shall not be paid more than the first two weeks 
for which he/she files such claims.
    (d) Other restrictions. The restrictions on entitlement specified in 
this section are in addition to other restrictions in the Act and this 
part on eligibility for and entitlement to Extended Benefits.



Sec.  615.10  Special provisions for employers.

    (a) Charging contributing employers. (1) Section 3303(a)(1) of the 
Internal Revenue Code of 1986 (26 U.S.C. 3303(a)(1)) does not require 
that Extended Benefits paid to an individual be charged to the 
experience rating accounts of employers.

[[Page 92]]

    (2) A State law may, however, consistently with section 3303(a)(1), 
require the charging of Extended Benefits paid to an individual; and if 
it does, it may provide for charging all or any portion of such 
compensation paid.
    (3) Sharable regular compensation must be charged as all other 
regular compensation is charged under the State law.
    (b) Payments by reimbursing employers. If an employer is reimbursing 
the State unemployment fund in lieu of paying contributions pursuant to 
the requirements of State law conforming with sections 3304(a)(6)(B) and 
3309(a)(2) of the Internal Revenue Code of 1986 (26 U.S.C. 3304(a)(6)(B) 
and 3309(a)(2)), the State law shall require the employer to reimburse 
the State unemployment fund for not less than 50 percent of any sharable 
compensation that is attributable under the State law to service with 
such employer; and as to any compensation which is not sharable 
compensation underSec. 615.14, the State law shall require the 
employer to reimburse the State unemployment fund for 100 percent, 
instead of 50 percent, of any such compensation paid.



Sec.  615.11  Extended Benefit Periods.

    (a) Beginning date. Except as provided in paragraph (d) of this 
section, an Extended Benefit Period shall begin in a State on the first 
day of the third calendar week after a week for which there is a State 
``on'' indicator in that State.
    (b) Ending date. Except as provided in paragraph (c) of this 
section, an Extended Benefit Period in a State shall end on the last day 
of the third week after the first week for which there is a State 
``off'' indicator in that State.
    (c) Duration. An Extended Benefit Period which becomes effective in 
any State shall continue in effect for not less than 13 consecutive 
weeks.
    (d) Limitation. No Extended Benefit Period may begin in any State by 
reason of a State ``on'' indicator before the 14th week after the ending 
of a Prior Extended Benefit Period with respect to such State.



Sec.  615.12  Determination of ``on'' and ``off'' indicators.

    (a) Standard State indicators. (1) There is a State ``on'' indicator 
in a State for a week if the head of the State agency determines, in 
accordance with this section, that, for the period consisting of that 
week and the immediately preceding 12 weeks, the rate of insured 
unemployment (not seasonally adjusted) under the State law--
    (i) Equalled or exceeded 120 percent of the average of such rates 
for the corresponding 13-week periods ending in each of the preceding 
two calendar years, and
    (ii) Equalled or exceeded 5.0 percent.
    (2) There is a State ``off'' indicator in a State for a week if the 
head of the State agency determines, in accordance with this section, 
that, for the period consisting of that week and the immediately 
preceding 12 weeks, the rate of insured unemployment (not seasonally 
adjusted) under the State law--
    (i) Was less than 120 percent of the average of such rates for the 
corresponding 13 week periods ending in each of the preceding two 
calendar years, or
    (ii) Was less than 5.0 percent.
    (3) The standard State indicators in this paragraph (a) shall apply 
to weeks beginning after September 25, 1982.
    (b) Optional State indicators. (1)(i) A State may, in addition to 
the State indicators in paragraph (a) of this section, provide by its 
law that there shall be a State ``on'' indicator in the State for a week 
if the head of the State agency determines, in accordance with this 
section, that, for the period consisting of that week and the 
immediately preceding 12 weeks, the rate of insured unemployment (not 
seasonally adjusted) under the State law equalled or exceeded 6.0 
percent even though it did not meet the 120 percent factor required 
under paragraph (a).
    (ii) A State which adopts the optional State indicator must also 
provide that, when it is in an Extended Benefit Period, there will not 
be an ``off'' indicator until (A) the State rate of insured unemployment 
is less than 6.0 percent, and (B) either its rate of insured 
unemployment is less than 5.0 percent or is less than 120 percent of

[[Page 93]]

the average of such rates for the corresponding 13-week periods ending 
in each of the preceding two calendar years.
    (2) The optional State indicators in this paragraph (b) shall apply 
to weeks beginning after September 25, 1982.
    (c) Computation of rate of insured unemployment--(1) Equation. Each 
week the State agency head shall calculate the rate of insured 
unemployment under the State law (not seasonally adjusted) for purposes 
of determining the State ``on'' and ``off'' and ``no change'' 
indicators. In making such calculations the State agency head shall use 
a fraction, the numerator of which shall be the weekly average number of 
weeks claimed in claims filed (not seasonally adjusted) in the State in 
the 13-week period ending with the week for which the determination is 
made, and the denominator of which shall be the average monthly 
employment covered by the State law for the first four of the last six 
calendar quarters ending before the close of the 13-week period. The 
quotient obtained is to be computed to four decimal places, and is not 
otherwise rounded, and is to be expressed as a percentage by multiplying 
the resultant decimal fraction by 100.
    (2) Counting weeks claimed. To determine the average number of weeks 
claimed in claims filed to serve as the numerator under paragraph 
(c)(1), the State agency shall include claims for all weeks for regular 
compensation, including claims taken as agent State under the Interstate 
Benefit Payment Plan. It shall exclude claims--
    (i) For Extended Benefits under any State law,
    (ii) For additional compensation under any State law, and
    (iii) Under any Federal law except joint claims which combine 
regular compensation and compensation payable under 5 U.S.C. chapter 85.
    (3) Method of computing the State 120 percent factor. The rate of 
insured unemployment for a current 13-week period shall be divided by 
the average of the rates of insured unemployment for the corresponding 
13-week periods in each of the two preceding calendar years to determine 
whether the rate is equal to 120 percent of the average rate for the two 
years. The quotient obtained shall be computed to four decimal places 
and not otherwise rounded, and shall be expressed as a percentage by 
multiplying the resultant decimal fraction by 100. The average of the 
rates for the corresponding 13-week periods in each of the two preceding 
calendar years shall be one-half the sum of such rates computed to four 
decimal places and not otherwise rounded. To determine which are the 
corresponding weeks in the preceding years--
    (i) The weeks shall be numbered starting with week number 1 as the 
first week ending in each calendar year.
    (ii) The 13-week period ending with any numbered week in the current 
year shall correspond to the period ending with that same numbered week 
in each preceding year.
    (iii) When that period in the current year ends with week number 53, 
the corresponding period in preceding years shall end with week number 
52 if there is no week number 53.
    (d) Amendment of State indicator rates. (1) Because figures used for 
determinations under this section may contain errors and because it is 
not practical to apply any correction in a State ``on'' or ``off'' or 
``no change'' indicator retroactively either to recover amounts paid or 
to adjudicate claims for past periods in which claimants failed to make 
the required active search for work, any determination by the head of a 
State agency of an ``on'' or ``off'' or ``no change'' indicator shall 
not be corrected more than three weeks after the close of the week to 
which it applies. If any figure used in the computation of a rate of 
insured unemployment is later found to be wrong, the correct figure 
shall be used to redetermine the rate of insured unemployment and of the 
120 percent factor for that week and all subsequent weeks, but no 
determination of previous ``on'' or ``off'' or ``no change'' indicator 
shall be affected unless the redetermination is made within the time the 
indicator may be corrected under the first sentence of this paragraph 
(d)(1). Any change hereunder shall be subject to the concurrence of the 
Department as provided in paragraph (e) of this section.
    (2) Any determination of the rate of insured unemployment and its 
effect

[[Page 94]]

on an ``on'' or ``off'' or ``no change'' indicator may be challenged by 
appeal or by other proceedings, as shall be provided by State law, but 
the implementation of any change in the indicator from one week to 
another shall not be stayed or postponed. In a hearing on any such 
challenge the issue may be limited to the accuracy of the determination 
of the rate of insured unemployment. If an error in that rate affecting 
the ``on'' or ``off'' or ``no change'' indicator is discovered in such a 
hearing or other proceeding, its retroactive effect shall be limited as 
provided in paragraph (d)(1).
    (e) Notice to Secretary. Within 10 calendar days after the end of 
any week with respect to which the head of a State agency has determined 
that there is an ``on,'' or ``off,'' or ``no change'' indicator in the 
State, the head of the State agency shall notify the Department of the 
determination. The notice shall state clearly the State agency head's 
determination of the specific week for which there is a State ``on'' or 
``off'' or ``no change'' indicator. The notice shall include also the 
State agency head's findings supporting the determination, with a 
certification that the findings are made in accordance with the 
requirements of thisSec. 615.15. Determinations and findings made as 
provided in this section shall be accepted by the Department, but the 
head of the State agency shall comply with such provisions as the 
Department may find necessary to assure the correctness and verification 
of notices given under this paragraph. A notice shall not become final 
for purposes of the Act and this part until such notice is accepted by 
the Department.



Sec.  615.13  Announcement of the beginning and ending of Extended 
Benefit Periods.

    (a) State indicators. Upon receipt of the notice required bySec. 
615.12(e) which is acceptable to the Department, the Department shall 
publish in the Federal Register a notice of the State agency head's 
determination that there is an ``on'' or an ``off'' indicator in the 
State, as the case may be, the name of the State and the beginning or 
ending of the Extended Benefit Period, whichever is appropriate. The 
Department shall also notify appropriate news media, the heads of all 
other State agencies, and the Regional Administrators of the Employment 
and Training Administration of the State agency head's determination of 
such State ``on'' or ``off'' indicator and of its effect.
    (b) Publicity by State. Whenever a State agency head determines that 
there is an ``on'' indicator in the State by reason of which an Extended 
Benefit Period will begin in the State, or an ``off'' indicator by 
reason of which an Extended Benefit Period in the State will end, the 
head of the State agency shall promptly announce the determination 
through appropriate news media in the State and notify the Department in 
accordance withSec. 615.12(e). Such announcement shall include the 
beginning or ending date of the Extended Benefit Period, whichever is 
appropriate. In the case of an Extended Benefit Period that is about to 
begin, the announcement shall describe clearly the unemployed 
individuals who may be eligible for Extended Benefits during the period, 
and in the case of an Extended Benefit Period that is about to end, the 
announcement shall also describe clearly the individuals whose 
entitlement to Extended Benefits will be terminated.
    (c) Notices to individuals. (1) Whenever there has been a 
determination that an Extended Benefit Period will begin in a State, the 
State agency shall provide prompt written notice of potential 
entitlement to Extended Benefits to each individual who has established 
a benefit year in the State that will not end prior to the beginning of 
the Extended Benefit Period, and who exhausted all rights under the 
State law to regular compensation before the beginning of the Extended 
Benefit Period.
    (2) The State agency shall provide such notice promptly to each 
individual who begins to claim sharable regular benefits or who exhausts 
all rights under the State law to regular compensation during an 
Extended Benefit Period, including exhaustion by reason of the 
expiration of the individual's benefit year.
    (3) The notices required by paragraphs (c) (1) and (2) of this 
section shall describe those actions required of

[[Page 95]]

claimants for sharable regular compensation and Extended Benefits and 
those disqualifications which apply to such benefits which are different 
from those applicable to other claimants for regular compensation which 
is not sharable.
    (4) Whenever there has been a determination that an Extended Benefit 
Period will end in a State, the State agency shall provide prompt 
written notice to each individual who is currently filing claims for 
Extended Benefits of the forthcoming end of the Extended Benefit Period 
and its effect on the individual's right to Extended Benefits.



Sec.  615.14  Payments to States.

    (a) Sharable compensation. (1) The Department shall promptly upon 
receipt of a State's report of its expenditures for a calendar month 
reimburse the State in the amount of the sharable compensation the State 
is entitled to receive under the Act and this part.
    (2) The Department may instead advance to a State for any period not 
greater than one day the amount the Department estimates the State will 
be entitled to be paid under the Act and this part for that period.
    (3) Any payment to a State under this section shall be based upon 
the Department's determination of the amount the State is entitled to be 
paid under the Act and this part, and such amount shall be reduced or 
increased, as the case may be, by any amount by which the Department 
finds that a previous payment was greater or less than the amount that 
should have been paid to the State.
    (4) Any payment to a State pursuant to this paragraph (a) shall be 
made by a transfer from the extended unemployment compensation account 
in the Unemployment Trust Fund to the account of the State in such Fund, 
in accordance with section 204(e) of the Act.
    (b) Payments not to be made to States. Because a State law must 
contain provisions fully consistent with sections 202 and 203 of the 
Act, the Department shall make no payment under paragraph (a) of this 
section, whether or not the State is certified under section 3304(c) of 
the Internal Revenue Code of 1986--
    (1) In respect of any regular or extended compensation paid to any 
individual for any week if the State does not apply--
    (i) The provisions of the State law required by section 202(a)(3) 
and this part, relating to failure to accept work offered or to apply 
for work or to actively engage in seeking work or the provisions of 
State law required by section 202(a)(4) and this part, relating to 
terminating a disqualification;
    (ii) The provisions of the State law required by section 202(a)(5) 
and this part, relating to qualifying employment; or
    (2) In respect of any regular or extended compensation paid to any 
individual for any week which was not payable by reason of the provision 
of the State law required by section 202(c) and this part as determined 
by the Department with regard to each State.
    (c) Payments not to be reimbursed. The Department shall make no 
payment under paragraph (a) of this section, whether or not the State is 
certified under section 3304(c) of the Internal Revenue Code of 1986, in 
respect of any regular or extended compensation paid under a State law--
    (1) As provided in section 204(a)(1) of the Act and this part, if 
the payment made was not sharable extended compensation or sharable 
regular compensation;
    (2) As provided in section 204(a)(2)(A) of the Act, if the State is 
entitled to reimbursement for the payment under the provisions of any 
Federal law other than the Act;
    (3) As provided in section 204(a)(2)(B) of the Act, if for the first 
week in an individual's eligibility period with respect to which 
Extended Benefits or sharable regular benefits are paid to the 
individual and the State law provides for the payment (at any time or 
under any circumstances) of regular compensation to any individual for 
the first week of unemployment in any such individual's benefit year; 
except that--
    (i) In the case of a State law which is changed so that regular 
compensation is not paid at any time or under any circumstances with 
respect to the first week of unemployment in any individual's benefit 
year, this paragraph (c)(3)

[[Page 96]]

shall not apply to any week which begins after the effective date of 
such change in the State law; and
    (ii) In the case of a State law which is changed so that regular 
compensation is paid at any time or under any circumstances with respect 
to the first week of unemployment in any individual's benefit year, this 
paragraph (c)(3) shall apply to all weeks which begin after the 
effective date of such change in the State law;
    (4) As provided in section 204(a)(2)(C) of the Act and this part, 
for any week with respect to which Extended Benefits are not payable 
because of the payment of trade readjustment allowances, as provided in 
section 233(d) of the Trade Act of 1974, andSec. 615.7(d).
    (5) As provided in section 204(a)(2)(D) of the Act and this part, if 
the State does not provide for a benefit structure under which benefits 
are rounded down to the next lower dollar amount, for the 50 percent 
Federal share of the amount by which sharable regular or Extended 
Benefits paid to any individual exceeds the nearest lower full dollar 
amount.
    (6) As provided in section 204(a)(3) of the Act, to the extent that 
such compensation is based upon employment and wages in service 
performed for governmental entities or instrumentalities to which 
section 3306(c)(7) of the Internal Revenue Code of 1986 (26 U.S.C. 
3306(c)(7)) applies, in the proportion that wages for such service in 
the base period bear to the total base period wages;
    (7) If the payment made was not sharable extended compensation or 
sharable regular compensation because the payment was not consistent 
with the requirements of--
    (i) Section 202(a)(3) of the Act, andSec. 615.8 (e), (f), or (g);
    (ii) Section 202(a)(4) of the Act, andSec. 615.8(c); or
    (iii) Section 202(a)(5) of the Act, andSec. 615.4(b);
    (8) If the payment made was not sharable extended compensation or 
sharable regular compensation because there was not in effect in the 
State an Extended Benefit Period in accord with the Act and this part; 
or
    (9) For any week with respect to which the claimant was either 
ineligible for or not entitled to the payment.
    (d) Effectuating authorization for reimbursement. (1) If the 
Department believes that reimbursement should not be authorized with 
respect to any payments made by a State that are claimed to be sharable 
compensation paid by the State, because the State law does not contain 
provisions required by the Act and this part, or because such law is not 
interpreted or applied in rules, regulations, determinations or 
decisions in a manner that is consistent with those requirements, the 
Department may at any time notify the State agency in writing of the 
Department's view. The State agency shall be given an opportunity to 
present its views and arguments if desired.
    (2) The Department shall thereupon decide whether the State law 
fails to include the required provisions or is not interpreted and 
applied so as to satisfy the requirements of the Act and this part. If 
the Department finds that such requirements are not met, the Department 
shall notify the State agency of its decision and the effect thereof on 
the State's entitlement to reimbursement under this section and the 
provisions of section 204 of the Act.
    (3) Thereafter, the Department shall not authorize any payment under 
paragraph (a) of this section in respect of any sharable regular or 
extended compensation if the State law does not contain all of the 
provisions required by sections 202 and 203 of the Act and this part, or 
if the State law, rules, regulations, determinations or decisions are 
not consistent with such requirements, or which would not have been 
payable if the State law contained the provisions required by the Act 
and this part or if the State law, rules, regulations, determinations or 
decisions had been consistent with such requirements. Loss of 
reimbursement for such compensation shall begin with the date the State 
law was required to contain such provisions, and shall continue until 
such time as the Department finds that such law, rules and regulations 
have been revised or the interpretations followed pursuant to such 
determinations and decisions have been overruled and payments are made 
or

[[Page 97]]

denied so as to accord with the Federal law requirements of the Act and 
this part, but no reimbursement shall be authorized with respect to any 
payment that did not fully accord with the Act and this part.
    (4) A State agency may request reconsideration of a decision issued 
pursuant to paragraph (d)(2) above, within 10 calendar days of the date 
of such decision, and shall be given an opportunity to present views and 
arguments if desired.
    (5) Concurrence of the Department in any State law provision, rule, 
regulation, determination or decision shall not be presumed from the 
absence of notice issued pursuant to this section or from a 
certification of the State issued pursuant to section 3304(c) of the 
Internal Revenue Code of 1986.
    (6) Upon finding that a State has made payments for which it claims 
reimbursement that are not consistent with the Act or this part, such 
claim shall be denied; and if the State has already been paid such claim 
in advance or by reimbursement, it shall be required to repay the full 
amount to the Department. Such repayment may be made by transfer of 
funds from the State's account in the Unemployment Trust Fund to the 
Extended Unemployment Compensation Account in the Fund, or by offset 
against any current advances or reimbursements to which the State is 
otherwise entitled, or the amount repayable may be recovered for the 
Extended Unemployment Compensation Account by other means and from any 
other sources that may be available to the United States or the 
Department.
    (e) Compensation under Federal unemployment compensation programs. 
The Department shall promptly reimburse each State which has paid 
sharable compensation based on service covered by the UCFE and UCX 
Programs (parts 609 and 614 of this chapter, respectively) pursuant to 5 
U.S.C. chapter 85, an amount which represents the full amount of such 
sharable compensation paid under the State law, or may make advances to 
the State. Such amounts shall be paid from the Federal Employees 
Compensation Account established for those programs, rather than from 
the Extended Unemployment Compensation Account.
    (f) Combined-wage claims. If an individual was paid benefits under 
the Interstate Arrangement for Combining Employment and Wages (part 616 
of this chapter) any payment required by paragraph (a) of this section 
shall be made to the States which contributed the wage credits.
    (g) Interstate claims. Where sharable compensation is paid to an 
individual under the provisions of the Interstate Benefit Payment Plan, 
any payment required by paragraph (a) of this section shall be made only 
to the liable State.

[53 FR 27937, July 25, 1988, as amended at 71 FR 35514, June 21, 2006]



Sec.  615.15  Records and reports.

    (a) General. State agencies shall furnish to the Secretary such 
information and reports and make such studies as the Secretary decides 
are necessary or appropriate for carrying out the purposes of the Act 
and this part.
    (b) Recordkeeping. Each State agency will make and maintain records 
pertaining to the administration of the Extended Benefit Program as the 
Department requires, and will make all such records available for 
inspection, examination and audit by such Federal officials or employees 
as the Secretary or the Department may designate or as may be required 
by law.
    (c) Weekly report of Extended Benefit data. Each State shall file 
with the Department within 10 calendar days after the end of each 
calendar week a weekly report entitled ETA 539, Extended Benefit Data. 
The report shall include:
    (1) The data reported on the form ETA 539 for the week ending 
(date). Week-ending dates shall always be the Saturday ending date of 
the calendar week beginning at 12:01 a.m. Sunday and ending 12:00 p.m. 
Saturday.
    (2)(i) The number of continued weeks claimed for regular 
compensation in claims filed during the week ending (date). The report 
shall include intrastate continued weeks claimed and interstate 
continued weeks claimed (taken as agent State) but shall exclude 
interstate continued weeks claimed (received as liable State) and 
continued weeks claimed for regular

[[Page 98]]

compensation filed solely under 5 U.S.C. chapter 85; and
    (ii) The report of the number of continued weeks claimed filed in 
the State for regular compensation shall not be adjusted for 
seasonality.
    (3) The average weekly number of weeks claimed in claims filed in 
the most recent calendar week and the immediately preceding 12 calendar 
weeks.
    (4) The rate of insured unemployment for the current 13-week period.
    (5) The average of the rates of insured unemployment in 
corresponding 13-week periods in the preceding two years.
    (6) The current rate of insured unemployment as a percentage of the 
average of the rates in the corresponding 13-week periods in the 
preceding two years.
    (7) The 12 month average monthly employment covered by the State law 
for the first 4 of the last 6 complete calendar quarters ending prior to 
the end of the last week of the current 13-week period to which the 
insured unemployment data relate. Such covered employment shall exclude 
Federal civilian and military employment covered by 5 U.S.C. chapter 85.
    (8) The date that a State Extended Benefit Period begins or ends, or 
a report that there is no change in the existing Extended Benefit Period 
status.
    (d) Methodology. The State agency head shall submit to the 
Department, for approval, the method used to identify and select the 
weeks claimed which are used in the determination of an ``on'' or 
``off'' or ``no change'' indicator. Any change proposed in the method of 
identification and selection of such weeks claimed constitutes a new 
plan which must be submitted to and approved by the Department prior to 
implementing the new plan.

(Approved by the Office of Management and Budget under control number 
1205-0028)



PART 616_INTERSTATE ARRANGEMENT FOR COMBINING EMPLOYMENT AND WAGES--
Table of Contents



Sec.
616.1 Purpose of arrangement.
616.2 Consultation with the State agencies.
616.3 Interstate cooperation.
616.4 Rules, regulations, procedures, forms--resolution of 
          disagreements.
616.6 Definitions.
616.7 Election to file a Combined-Wage Claim.
616.8 Responsibilities of the paying State.
616.9 Responsibilities of transferring States.
616.10 Reuse of employment and wages.
616.11 Amendment of arrangement.

    Authority: 26 U.S.C. 3304(a)(9)(B); Secretary's Order No. 3-2007, 
Apr. 3, 2007 (72 FR 15907).

    Source: 36 FR 24992, Dec. 28, 1971, unless otherwise noted.



Sec.  616.1  Purpose of arrangement.

    This arrangement is approved by the Secretary under the provisions 
of section 3304(a)(9)(B) of the Federal Unemployment Tax Act to 
establish a system whereby an unemployed worker with covered employment 
or wages in more than one State may combine all such employment and 
wages in one State, in order to qualify for benefits or to receive more 
benefits.



Sec.  616.2  Consultation with the State agencies.

    As required by section 3304(a)(9)(B), this arrangement has been 
developed in consultation with the State unemployment compensation 
agencies. For purposes of such consultation in its formulation and any 
future amendment the Secretary recognizes, as agents of the State 
agencies, the duly designated representatives of the National 
Association of State Workforce Agencies (NASWA).

[36 FR 24992, Dec. 28, 1971, as amended at 71 FR 35514, June 21, 2006]



Sec.  616.3  Interstate cooperation.

    Each State agency will cooperate with every other State agency by 
implementing such rules, regulations, and procedures as may be 
prescribed for the operation of this arrangement. Each State agency 
shall identify the paying and the transferring State with respect to 
Combined-Wage Claims filed in its State.



Sec.  616.4  Rules, regulations, procedures, forms--resolution of 
disagreements.

    All State agencies shall operate in accordance with such rules, 
regulations, and procedures, and shall use

[[Page 99]]

such forms, as shall be prescribed by the Secretary in consultation with 
the State unemployment compensation agencies. All rules, regulations, 
and standards prescribed by the Secretary with respect to intrastate 
claims will apply to claims filed under this arrangement unless they are 
clearly inconsistent with the arrangement. The Secretary shall resolve 
any disagreement between State agencies concerning the operation of the 
arrangement, with the advice of the duly designated representatives of 
the State agencies.



Sec.  616.6  Definitions.

    These definitions apply for the purpose of this arrangement and the 
procedures issued to effectuate it.
    (a) State. ``State'' includes the States of the United States of 
America, the District of Columbia, the Commonwealth of Puerto Rico, and 
the Virgin Islands.
    (b) State agency. The agency which administers the unemployment 
compensation law of a State.
    (c) Combined-Wage Claim. A claim filed under this arrangement.
    (d) Combined-Wage Claimant. A claimant who has covered wages under 
the unemployment compensation law of more than one State and who has 
filed a claim under this arrangement.
    (e) Paying State. A single State against which the claimant files a 
Combined-Wage Claim, if the claimant has wages and employment in that 
State's base period(s) and the claimant qualifies for unemployment 
benefits under the unemployment compensation law of that State using 
combined wages and employment.
    (f) Transferring State. A State in which a Combined-Wage Claimant 
had covered employment and wages in the base period of a paying State, 
and which transfers such employment and wages to the paying State for 
its use in determining the benefit rights of such claimant under its 
law.
    (g) Employment and wages. ``Employment'' refers to all services 
which are covered under the unemployment compensation law of a State, 
whether expressed in terms of weeks of work or otherwise. ``Wages'' 
refers to all remuneration for such employment.
    (h) Secretary. The Secretary of Labor of the United States.
    (i) Base period and benefit year. The base period and benefit year 
applicable under the unemployment compensation law of the paying State.

[36 FR 24992, Dec. 28, 1971, as amended at 39 FR 45215, Dec. 31, 1974; 
43 FR 2625, Jan. 17, 1978; 71 FR 35514, June 21, 2006; 73 FR 63072, Oct. 
23, 2008]



Sec.  616.7  Election to file a Combined-Wage Claim.

    (a) Any unemployed individual who has had employment covered under 
the unemployment compensation law of two or more States, whether or not 
the individual is monetarily qualified under one or more of them, may 
elect to file a Combined-Wage Claim. The individual may not so elect, 
however, if the individual has established a benefit year under any 
State or Federal unemployment compensation law and:
    (1) The benefit year has not ended, and
    (2) The individual still has unused benefit rights based on such 
benefit year. \1\
---------------------------------------------------------------------------

    \1\ The Federal-State Extended Unemployment Compensation Act of 
1970, title II, Public Law 91-373, section 202(a)(1), limits the payment 
of extended benefits with respect to any week to individuals who have no 
rights to regular compensation with respect to such week under any State 
unemployment compensation law or to compensation under any other Federal 
law and in certain other instances. This provision precludes any 
individual from receiving any Federal-State extended benefits with 
respect to any week for which the individual is eligible to receive 
regular benefits based on a Combined Wage Claim. (See section 5752, part 
V of the Employment Security Manual.)
---------------------------------------------------------------------------

    (b) For the purposes of this arrangement, a claimant will not be 
considered to have unused benefit rights based on a benefit year which 
the claimant has established under a State or Federal unemployment 
compensation law if:
    (1) The claimant has exhausted his/her rights to all benefits based 
on such benefit year; or
    (2) The claimant's rights to such benefits have been postponed for 
an indefinite period or for the entire period in which benefits would 
otherwise be payable; or

[[Page 100]]

    (3) Benefits are affected by the application of a seasonal 
restriction.
    (c) If an individual elects to file a Combined-Wage Claim, all 
employment and wages in all States in which the individual worked during 
the base period of the paying State must be included in such combining, 
except employment and wages which are not transferrable under the 
provisions ofSec. 616.9(b).
    (d) A Combined-Wage Claimant may withdraw his/her Combined-Wage 
Claim within the period prescribed by the law of the paying State for 
filing an appeal, protest, or request for redetermination (as the case 
may be) from the monetary determination of the Combined-Wage Claim, 
provided the claimant either:
    (1) Repays in full any benefits paid to him thereunder, or
    (2) Authorizes the State(s) against which the claimant files a 
substitute claim(s) for benefits to withhold and forward to the paying 
State a sum sufficient to repay such benefits.
    (e) If the Combined-Wage Claimant files his/her claim in a State 
other than the paying State, the claimant shall do so pursuant to the 
Interstate Benefit Payment Plan.
    (f) If a State denies a Combined-Wage Claim, it must inform the 
claimant of the option to file in another State in which the claimant 
has wages and employment during that State's base period(s).

[36 FR 24992, Dec. 28, 1971, as amended at 71 FR 35514, 35515, June 21, 
2006; 73 FR 63072, Oct. 23, 2008]



Sec.  616.8  Responsibilities of the paying State.

    (a) Transfer of employment and wages--payment of benefits. The 
paying State shall request the transfer of a Combined-Wage Claimant's 
employment and wages in all States during its base period, and shall 
determine the claimant's entitlement to benefits (including additional 
benefits, extended benefits and dependents' allowances when applicable) 
under the provisions of its law based on employment and wages in the 
paying State, and all such employment and wages transferred to it 
hereunder. The paying State shall apply all the provisions of its law to 
each determination made hereunder, except that the paying State may not 
determine an issue which has previously been adjudicated by a 
transferring State. Such exception shall not apply, however, if the 
transferring State's determination of the issue resulted in making the 
Combined-Wage Claim possible underSec. 616.7(b)(2). If the paying 
State fails to establish a benefit year for the Combined-Wage Claimant, 
or if the claimant withdraws his/her claim as provided herein, it shall 
return to each transferring State all employment and wages thus unused.
    (b) Notices of determination. The paying State shall give to the 
claimant a notice of each of its determinations on his/her Combined-Wage 
Claim that he/she is required to receive under the Secretary's Claim 
Determinations Standard and the contents of such notice shall meet such 
Standard. When the claimant is filing his/her Combined-Wage Claims in a 
State other than the paying State, the paying State shall send a copy of 
each such notice to the local office in which the claimant filed such 
claims.
    (c) Redeterminations. (1) Redeterminations may be made by the paying 
State in accordance with its law based on additional or corrected 
information received from any source, including a transferring State, 
except that such information shall not be used as a basis for changing 
the paying State if benefits have been paid under the Combined-Wage 
Claim.
    (2) When a determination is made, as provided in paragraph (a) of 
this section, which suspends the use of wages earned in employment with 
an educational institution during a prescribed period between successive 
academic years or terms or other periods as prescribed in the law of the 
paying State in accordance with section 3304(a)(6)(A)(i)-(iv) of the 
Internal Revenue Code of 1986, the paying State shall furnish each 
transferring State involved in the combined-Wage Claim an adjusted 
determination used to recompute each State's proportionate share of any 
charges that may accumulate for benefits paid during the period of 
suspended use of school wages. Wages which are suspended shall be 
retained by the paying State for possible future reinstatement to the 
Combined-

[[Page 101]]

Wage Claim and shall not be returned to the transferring State.
    (d) Appeals. (1) Except as provided in paragraph (d)(3) of this 
section, where the claimant files his/her Combined-Wage Claim in the 
paying State, any protest, request for redetermination or appeal shall 
be in accordance with the law of such State.
    (2) Where the claimant files his/her Combined-Wage Claim in a State 
other than the paying State, or under the circumstances described in 
paragraph (d)(3) of this section, any protest, request for 
redetermination or appeal shall be in accordance with the Interstate 
Benefit Payment Plan.
    (3) To the extent that any protest, request for redetermination or 
appeal involves a dispute as to the coverage of the employing unit or 
services in a transferring State, or otherwise involves the amount of 
employment and wages subject to transfer, the protest, request for 
redetermination or appeal shall be decided by the transferring State in 
accordance with its law.
    (e) Recovery of prior overpayments. If there is an overpayment 
outstanding in a transferring State and such transferring State so 
requests, the overpayment shall be deducted from any benefits the paying 
State would otherwise pay to the claimant on his/her Combined-Wage Claim 
except to the extent prohibited by the law of the paying State. The 
paying State shall transmit the amount deducted to the transferring 
State or credit the deduction against the transferring State's required 
reimbursement under this arrangement. This paragraph shall apply to 
overpayments only if the transferring State certifies to the paying 
State that the determination of overpayment was made within 3 years 
before the Combined-Wage Claim was filed and that repayment by the 
claimant is legally required and enforceable against him/her under the 
law of the transferring State.
    (f) Statement of benefit charges. (1) At the close of each calendar 
quarter, the paying State shall send each transferring State a statement 
of benefits charged during such quarter to such State as to each 
Combined-Wage Claimant.
    (2) Except as provided in paragraphs (c)(2), (f)(3), and (f)(5) of 
this section, each such charge shall bear the same ratio to the total 
benefits paid to the Combined-Wage Claimant by the paying State as the 
claimant's wages transferred by the transferring State bear to the total 
wages used in such determination. Each such ratio shall be computed as a 
percentage, to three or more decimal places.
    (3) Charges to the transferring State shall not include the costs of 
any benefits paid which are funded or reimbursed from the Federal 
Unemployment Benefits and Allowances account in the U.S. Department of 
Labor appropriation, including:
    (i) Benefits paid pursuant to 5 U.S.C. 8501-8525; and
    (ii) Benefits which are reimbursable under part B of title II of the 
Emergency Jobs and Unemployment Assistance Act of 1974 (Pub. L. 93-567).
    (4) Except as provided in paragraphs (f)(3) and (f)(5) of this 
section, all transferring States will be charged by the paying State for 
Extended Benefits in the same manner as for regular benefits.
    (5) The United States shall be charged directly by the paying State, 
in the same manner as is provided in paragraphs (f)(1) and (f)(2) of 
this section, in regard to Federal civilian service and wages and 
Federal military service and wages assigned or transferred to the paying 
State and included in Combined-Wage Claims in accordance with this part 
and parts 609 and 614 of this chapter.

(26 U.S.C. 3304(a)(9)(B); Secretary's Order No. 4-75, (40 FR 18515))

[36 FR 24992, Dec. 28, 1971, as amended at 43 FR 2625, Jan. 17, 1978; 45 
FR 47109, July 11, 1980; 71 FR 35515, June 21, 2006; 73 FR 63072, Oct. 
23, 2008]



Sec.  616.9  Responsibilities of transferring States.

    (a) Transfer of employment and wages. Each transferring State shall 
promptly transfer to the Paying State the employment and wages the 
Combined-Wage Claimant had in covered employment during the base period 
of the paying State. Any employment and wages so transferred shall be 
transferred without restriction as to their use for

[[Page 102]]

determination and benefit payments under the provisions of the paying 
State's law.
    (b) Employment and wages not transferable. Employment and wages 
transferred to the paying State by a transferring State shall not 
include:
    (1) Any employment and wages which have been transferred to any 
other paying State and not returned unused, or which have been used in 
the transferring State as the basis of a monetary determination which 
established a benefit year.
    (2) Any employment and wages which have been canceled or are 
otherwise unavailable to the claimant as a result of a determination by 
the transferring State made prior to its receipt of the request for 
transfer, if such determination has become final or is in the process of 
appeal but is still pending. If the appeal is finally decided in favor 
of the Combined-Wage Claimant, any employment and wages involved in the 
appeal shall forthwith be transferred to the paying State and any 
necessary redetermination shall be made by such paying State.
    (c) Reimbursement of paying State. Each transferring State shall, as 
soon as practicable after receipt of a quarterly statement of charges 
described herein, reimburse the paying State accordingly.

(26 U.S.C. 3304(a)(9)(B); Secretary's Order No. 4-75, (40 FR 18515))

[36 FR 24992, Dec. 28, 1971, as amended at 45 FR 47109, July 11, 1980]



Sec.  616.10  Reuse of employment and wages.

    Employment and wages which have been used under this arrangement for 
a determination of benefits which establishes a benefit year shall not 
thereafter be used by any State as the basis for another monetary 
determination of benefits.



Sec.  616.11  Amendment of arrangement.

    Periodically the Secretary shall review the operation of this 
arrangement, and shall propose such amendments to the arrangement as the 
Secretary believes are necessary or appropriate. Any State unemployment 
compensation agency or NASWA may propose amendments to the arrangement. 
Any proposal shall constitute an amendment to the arrangement upon 
approval by the Secretary in consultation with the State unemployment 
compensation agencies. Any such amendment shall specify when the change 
shall take effect, and to which claims it shall apply.

[36 FR 24992, Dec. 28, 1971, as amended at 71 FR 35515, June 21, 2006]



PART 617_TRADE ADJUSTMENT ASSISTANCE FOR WORKERS UNDER THE TRADE ACT
OF 1974--Table of Contents



                            Subpart A_General

Sec.
617.1 Scope.
617.2 Purpose.
617.3 Definitions.
617.4 Benefit information to workers.

              Subpart B_Trade Readjustment Allowances (TRA)

617.10 Applications for TRA.
617.11 Qualifying requirements for TRA.
617.12 Evidence of qualification.
617.13 Weekly amounts of TRA.
617.14 Maximum amount of TRA.
617.15 Duration of TRA.
617.16 Applicable State law.
617.17 Availability and active search for work.
617.18 Disqualifications.
617.19 Requirement for participation in training.

                     Subpart C_Reemployment Services

617.20 Responsibilities for the delivery of reemployment services.
617.21 Reemployment services and allowances.
617.22 Approval of training.
617.23 Selection of training methods and programs.
617.24 Preferred training.
617.25 Limitations on training under subpart C of this part.
617.26 Liable and agent State responsibilities.
617.27 Subsistence payments.
617.28 Transportation payments.
617.29 Application of EB work test.

                     Subpart D_Job Search Allowances

617.30 General.
617.31 Applications.
617.32 Eligibility.
617.33 Findings required.
617.34 Amount.
617.35 Time and method of payment.

[[Page 103]]

                     Subpart E_Relocation Allowances

617.40 General.
617.41 Applications.
617.42 Eligibility.
617.43 Time of relocation.
617.44 Findings required.
617.45 Amount.
617.46 Travel allowance.
617.47 Moving allowance.
617.48 Time and method of payment.

                      Subpart F_Job Search Program

617.49 Job Search Program.

          Subpart G_Administration by Applicable State Agencies

617.50 Determinations of entitlement; notices to individuals.
617.51 Appeals and hearings.
617.52 Uniform interpretation and application.
617.53 Subpoenas.
617.54 State agency rulemaking.
617.55 Overpayments; penalties for fraud.
617.56 Inviolate rights to TAA.
617.57 Recordkeeping; disclosure of information.
617.58 Unemployment insurance.
617.59 Agreements with State agencies.
617.60 Administration requirements. [Reserved]
617.61 Information, reports, and studies.
617.64 Termination of TAA program benefits.

Appendix A to Part 617--Standard for Claim Filing, Claimant Reporting, 
          Job Finding, and Employment Services
Appendix B to Part 617--Standard for Claim Determinations--Separation 
          Information
Appendix C to Part 617--Standard for Fraud and Overpayment Detection

    Authority: 19 U.S.C. 2320; Secretary's Order No. 3-81, 46 FR 31117.

    Source: 51 FR 45848, Dec. 22, 1986, unless otherwise noted.



                            Subpart A_General



Sec.  617.1  Scope.

    The regulations in this part 617 pertain to:
    (a) Adjustment assistance, such as counseling, testing, training, 
placement, and other supportive services for workers adversely affected 
under the terms of chapter 2 of title II of the Trade Act of 1974, as 
amended (hereafter referred to as the Act);
    (b) Trade readjustment allowances (hereafter referred to as TRA) and 
other allowances such as allowances while in training, job search and 
relocation allowances; and
    (c) Administrative requirements applicable to State agencies to 
which such individuals may apply.



Sec.  617.2  Purpose.

    The Act created a program of trade adjustment assistance (hereafter 
referred to as TAA) to assist individuals, who became unemployed as a 
result of increased imports, return to suitable employment. The TAA 
program provides for reemployment services and allowances for eligible 
individuals. The regulations in this part 617 are issued to implement 
the Act.



Sec.  617.3  Definitions.

    For the purposes of the Act and this part 617:
    (a) Act means chapter 2 of title II of the Trade Act of 1974, Pub. 
L. 93-618, 88 Stat. 1978, 2019-2030 (19 U.S.C. 2271-2322), as amended.
    (b) Adversely affected employment means employment in a firm or 
appropriate subdivision of a firm, including workers in any agricultural 
firm or subdivision of an agricultural firm, if workers of such firm or 
appropriate subdivision are certified under the Act as eligible to apply 
for TAA.
    (c) Adversely affected worker means an individual who, because of 
lack of work in adversely affected employment:
    (1) Has been totally or partially separated from such employment; or
    (2) Has been totally separated from employment with the firm in a 
subdivision of which such adversely affected employment exists.
    (d) Appropriate week means the week in which the individual's first 
separation occurred.
    (e) Average weekly hours means a figure obtained by dividing:
    (1) Total hours worked (excluding overtime) by a partially separated 
individual in adversely affected employment in the 52 weeks (excluding 
weeks in such period during which the individual was sick or on 
vacation) preceding the individual's first qualifying separation, by
    (2) The number of weeks in such 52 weeks (excluding weeks in such 
period during which the individual was sick or

[[Page 104]]

on vacation) in which the individual actually worked in such employment.
    (f) Average weekly wage means one-thirteenth of the total wages paid 
to an individual in the individual's high quarter. The high quarter for 
an individual is the quarter in which the total wages paid to the 
individual were highest among the first four of the last five completed 
calendar quarters preceding the individual's appropriate week.
    (g) Average weekly wage in adversely affected employment means a 
figure obtained by dividing:
    (1) Total wages earned by a partially separated individual in 
adversely affected employment in the 52 weeks (excluding the weeks in 
that period the individual was sick or on vacation) preceding the 
individual's first qualifying separation, by
    (2) The number of weeks in such 52 weeks (excluding the weeks in 
that period the individual was sick or on vacation) the individual 
actually worked in such employment.
    (h) Benefit period means, with respect to an individual:
    (1) The benefit year and any ensuing period, as determined under the 
applicable State law, during which the individual is eligible for 
regular compensation, additional compensation, extended compensation, or 
federal supplemental compensation, as these terms are defined by 
paragraph (oo) of this section; or
    (2) The equivalent to such a benefit year or ensuing period provided 
for under the Federal unemployment insurance law.
    (i) Bona fide application for training means an individual's signed 
and dated application for training filed with the State agency 
administering the TAA training program, on a form necessarily containing 
the individual's name, petition number, local office number, and 
specific occupational training. This form shall be signed and dated by a 
State agency representative upon receipt.
    (j)(1) Certification means a certification of eligibility to apply 
for TAA issued under section 223 of the Act with respect to a specified 
group of workers of a firm or appropriate subdivision of a firm.
    (2) Certification period means the period of time during which total 
and partial separations from adversely affected employment within a firm 
or appropriate subdivision of a firm are covered by the certification.
    (k) Commuting area means the area in which an individual would be 
expected to travel to and from work on a daily basis as determined under 
the applicable State law.
    (l) Date of separation means:
    (1) With respect to a total separation--
    (i) For an individual in employment status, the last day worked; and
    (ii) For an individual on employer-authorized leave, the last day 
the individual would have worked had the individual been working; and
    (2) With respect to a partial separation, the last day of the week 
in which the partial separation occurred.
    (m) Eligibility period means the period of consecutive calendar 
weeks during which basic or additional TRA is payable to an otherwise 
eligible individual, and for an individual such eligibility period is--
    (1) Basic TRA. With respect to a total qualifying separation (as 
defined in paragraph (t)(3)(i) of this section) the 104-week period 
beginning with the first week following the week in which such total 
qualifying separation occurred; provided, that an individual who has a 
second or subsequent total qualifying separation within the 
certification period of the same certification shall be determined to 
have a new 104-week eligibility period based upon the most recent such 
total qualifying separation.
    (2) Additional TRA. With respect to additional weeks of TRA, and any 
individual determined under this part 617 to be entitled to additional 
TRA, the consecutive calendar weeks that occur in the 26-week period 
that--
    (i) Immediately follows the last week of entitlement to basic TRA 
otherwise payable to the individual, or
    (ii) Begins with the first week of training approved under this part 
617, if such training begins after the last week described in paragraph 
(m)(2)(i) of this section, or
    (iii) Begins with the first week in which such training is approved 
under

[[Page 105]]

this part 617, if such training is so approved after the training has 
commenced; but approval of training under this part 617 after the 
training has commenced shall not imply or justify approval of a payment 
of basic or additional TRA with respect to any week which ended before 
the week in which such training was approved, nor approval of payment of 
any costs of training or any costs or expenses associated with such 
training (such as travel or subsistence) which were incurred prior to 
the date of the approval of such training under this part 617.
    (n) Employer means any individual or type of organization, including 
the Federal government, a State government, a political subdivision, or 
an instrumentality of one or more governmental entities, with one or 
more individuals performing service in employment for it within the 
United States.
    (o) Employment means any service performed for an employer by an 
officer of a corporation or an individual for wages.
    (p) Exhaustion of UI means exhaustion of all rights to UI in a 
benefit period by reason of:
    (1) Having received all UI to which an individual was entitled under 
the applicable State law or Federal unemployment compensation law with 
respect to such benefit period; or
    (2) The expiration of such benefit period.
    (q) Family means the following members of an individual's household 
whose principal place of abode is with the individual in a home the 
individual maintains or would maintain but for unemployment:
    (1) A spouse;
    (2) An unmarried child, including a stepchild, adopted child, or 
foster child, under age 21 or of any age if incapable of self-support 
because of mental or physical incapacity; and
    (3) Any other person whom the individual would be entitled to claim 
as a dependent for income tax purposes under the Internal Revenue Code 
of 1986.
    (r) First benefit period means the benefit period established after 
the individual's first qualifying separation or in which such separation 
occurs.
    (s) First exhaustion of UI means the first time in an individual's 
first benefit period that the individual exhausts all rights to UI; 
first exhaustion shall be deemed to be complete at the end of the week 
the exhaustion occurs.
    (t)(1) First separation means, for an individual to qualify as an 
adversely affected worker for the purposes of TAA program benefits 
(without regard to whether the individual also qualifies for TRA), the 
individual's first total or partial separation within the certification 
period of a certification, irrespective of whether such first separation 
also is a qualifying separation as defined in paragraph (t)(2) of this 
section;
    (2) Qualifying separation means for an individual to qualify as an 
adversely affected worker and for basic TRA, any total separation of the 
individual within the certification period of a certification with 
respect to which the individual meets all of the requirements inSec. 
617.11(a)(2)(i) through (iv), and which qualifies as a total qualifying 
separation as defined in paragraph (B) of (t)(3)(i) of this section.
    (3) First qualifying separation means--
    (i) For the purposes of determining an individual's eligibility 
period for basic TRA, the first total separation of the individual 
within the certification period of a certification, with respect to 
which the individual meets all of the requirements inSec. 
617.11(a)(2)(i) through (iv).
    (ii) For the purposes of determining the weekly and maximum amounts 
of basic TRA payable to an individual, with respect to a separation that 
occurs before, on, or after August 23, 1988, the individual's first 
(total or partial) separation within the certification period of a 
certification if, with respect to such separation, the individual meets 
the requirements ofSec. 617.11(a)(1) (i), (ii) and (iv) orSec. 
617.11(a)(2) (i), (ii) and (iv).
    (u) Head of family means an individual who maintains a home for a 
family. An individual maintains a home if over half the cost of 
maintenance is furnished by the individual or would be furnished but for 
unemployment.
    (v) Impact date means the date stated in a certification issued 
under the Act

[[Page 106]]

on which total or partial separations began or threatened to begin in a 
firm or a subdivision of a firm.
    (w) Job search program means a job search workshop or job finding 
club.
    (x) Job search workshop means a short (1 to 3 days) seminar designed 
to provide participants with knowledge that will enable the participants 
to find jobs. Subjects should include, but not be limited to, labor 
market information, resume writing, interviewing techniques, and 
techniques for finding job openings.
    (y) Job finding club means a job search workshop which includes a 
period of 1 to 2 weeks of structured, supervised activity in which 
participants attempt to obtain jobs.
    (z) Layoff means a suspension of or separation from employment by a 
firm for lack of work, initiated by the employer, and expected to be for 
a definite or indefinite period of not less than seven consecutive days.
    (aa) Liable State and Agent State are defined as follows:
    (1) Liable State means, with respect to any individual, the State 
whose State law is the applicable State law as determined underSec. 
617.16 for all purposes of this Part 617.
    (2) Agent State means, with respect to any individual, any State 
other than the State which is the liable State for such individual.
    (bb) On-the-job training means training provided by an employer to 
an individual who is employed by the employer.
    (cc) Partial separation means that during a week ending on or after 
the impact date specified in the certification under which an adversely 
affected worker is covered, the individual had:
    (1) Hours of work reduced to 80 percent or less of the individual's 
average weekly hours in adversely affected employment; and
    (2) Wages reduced to 80 percent or less of the individual's average 
weekly wage in such adversely affected employment.
    (dd) Regional Administrator means the appropriate Regional 
Administrator of the Employment and Training Administration, United 
States Department of Labor (hereafter Department).
    (ee) Remuneration means remuneration as defined in the applicable 
State law.
    (ff) Secretary means the Secretary of Labor, U.S. Department of 
Labor, or his or her designee.
    (gg) Separate maintenance means maintaining another (second) 
residence, in addition to the individual's regular place of residence, 
while attending a training facility outside the individual's commuting 
area.
    (hh) State means the States of the United States, the District of 
Columbia, and the Commonwealth of Puerto Rico, and the term ``United 
States'' when used in a geographical sense includes such Commonwealth.
    (ii) State agency means the State Workforce Agency; the employment 
service of the State; any State agency carrying out title I, Subchapter 
B of the Workforce Investment Act; or any other State or local agency 
administering job training or related programs with which the Secretary 
has an agreement to carry out any of the provisions of the Act.
    (jj) State law means the unemployment compensation law of a State 
approved by the Secretary under section 3304 of the Internal Revenue 
Code of 1986 (26 U.S.C. 3304).
    (kk) Suitable work means, with respect to an individual:
    (1) Suitable work as defined in the applicable State law for 
claimants for regular compensation (as defined in paragraph (oo)(1) of 
this section); or
    (2) Suitable work as defined in applicable State law provisions 
consistent with section 202(a)(3) of the Federal-State Extended 
Unemployment Compensation Act of 1970;

whichever is applicable, but does not in any case include self-
employment or employment as an independent contractor.
    (ll) Total separation means a layoff or severance of an individual 
from employment with a firm in which, or in a subdivision of which, 
adversely affected employment exists.

[[Page 107]]

    (mm) Trade adjustment assistance (TAA) means the services and 
allowances provided for achieving reemployment of adversely affected 
workers, including TRA, training and other reemployment services, and 
job search allowances and relocation allowances.
    (nn) Trade readjustment allowance (TRA) means a weekly allowance 
payable to an adversely affected worker with respect to such worker's 
unemployment under subpart B of this part 617.
    (oo) Unemployment insurance (UI) means the unemployment compensation 
payable to an individual under any State law or Federal unemployment 
compensation law, including chapter 85, title 5 of the United States 
Code, and the Railroad Unemployment Insurance Act. ``UI'' includes 
``regular compensation,'' ``additional compensation,'' ``extended 
compensation,'' and ``federal supplemental compensation,'' defined as 
follows:
    (1) Regular compensation means unemployment compensation payable to 
an individual under any State law, and, when so payable, includes 
unemployment compensation payable pursuant to chapter 85, title 5 of the 
United States Code, but does not include extended compensation, 
additional compensation, or federal supplemental compensation;
    (2) Additional compensation means unemployment compensation totally 
financed by a State and payable under a State law by reason of 
conditions of high unemployment or by reason of other special factors 
and, when so payable, includes unemployment compensation payable 
pursuant to chapter 85, title 5 of the United States Code; and
    (3) Extended compensation means the extended unemployment 
compensation payable to an individual for weeks of unemployment which 
begin in an Extended Benefit Period, under those provisions of a State 
law which satisfy the requirements of the Federal-State Extended 
Unemployment Compensation Act of 1970 and regulations governing the 
payment of extended unemployment compensation, and, when so payable, 
includes unemployment compensation payable pursuant to chapter 85, title 
5 of the United States Code, but does not include regular compensation, 
additional compensation, or federal supplemental compensation. Extended 
compensation is also referred to in this part 617 as Extended Benefits 
or EB.
    (4) Federal supplemental compensation means the supplemental 
unemployment compensation payable to individuals who have exhausted 
their rights to regular and extended compensation, and which is payable 
under the Federal Supplemental Compensation Act of 1982 or any similar 
Federal law enacted before or after the 1982 Act.
    (pp) Wages means all compensation for employment for an employer, 
including commissions, bonuses, and the cash value of all compensation 
in a medium other than cash.
    (qq) Week means a week as defined in the applicable State law.
    (rr) Week of unemployment means a week of total, part total, or 
partial unemployment as determined under the applicable State law or 
Federal unemployment compensation law.

[51 FR 45848, Dec. 22, 1986, as amended at 53 FR 32348, Aug. 24, 1988; 
59 FR 926, 927, Jan. 6, 1994; 61 FR 19983, May 3, 1996; 71 FR 35515, 
June 21, 2006]



Sec.  617.4  Benefit information to workers.

    (a) Providing information to workers. State agencies shall provide 
full information to workers about the benefit allowances, training, and 
other employment services available under subparts B through E of this 
part 617 and about the petition and application procedures, and the 
appropriate filing dates, for such allowances, training and services.
    (b) Providing assistance to workers. State agencies shall provide 
whatever assistance is necessary to enable groups of workers, including 
unorganized workers, to prepare petitions or applications for program 
benefits.
    (c) Providing information to State vocational education agencies and 
others. State agencies shall inform the State Board for Vocational 
Education or equivalent agency and other public or private agencies, 
institutions, and employers, as appropriate, of each certification 
issued under section 223 of the Act and of projections, if available, of 
the needs for training under section 236

[[Page 108]]

of the Act as a result of such certification.
    (d) Written and newspaper notices--(1) Written notices to workers. 
(i) Upon receipt of a certification issued by the Department of Labor, 
the State agency shall provide a written notice through the mail of the 
benefits available under subparts B through E of this part 617 to each 
worker covered by a certification issued under section 223 of the Act 
when the worker is partially or totally separated or as soon as possible 
after the certification is issued if such workers are already partially 
or totally separated from adversely affected employment.
    (ii) The State agency will satisfy this requirement by obtaining 
from the firm, or other reliable source, the names and addresses of all 
workers who were partially or totally separated from adversely affected 
employment before the certification was received by the agency, and 
workers who are thereafter partially or totally separated within the 
certification period. The State agency shall mail a written notice to 
each such worker of the benefits available under the TAA Program. The 
notice must include the following information:
    (A) Worker group(s) covered by the certification, and the article(s) 
produced as specified in the copy of the certification furnished to the 
State agency.
    (B) Name and the address or location of workers' firm.
    (C) Impact, certification, and expiration dates in the certification 
document.
    (D) Benefits and reemployment services available to eligible 
workers.
    (E) Explanation of how workers apply for TAA benefits and services.
    (F) Whom to call to get additional information on the certification.
    (G) When and where the workers should come to apply for benefits and 
services.
    (2) Newspaper notices. (i) Upon receipt of a copy of a certification 
issued by the Department affecting workers in a State, the State agency 
shall publish a notice of such certification in a newspaper of general 
circulation in areas in which such workers reside. Such a newspaper 
notice shall not be required to be published, however, in the case of a 
certification with respect to which the State agency can substantiate, 
and enters in its records evidence substantiating, that all workers 
covered by the certification have received written notice required by 
paragraph (d)(1) of this section.
    (ii) A published notice must include the following kinds of 
information:
    (A) Worker group(s) covered by the certification, and the article(s) 
produced as specified in the copy of the certification furnished to the 
State agency.
    (B) Name and the address or location of workers' firm.
    (C) Impact, certification, and expiration dates in the certification 
document.
    (D) Benefits and reemployment services available to eligible 
workers.
    (E) Explanation of how and where workers should apply for TAA 
benefits and services.
    (e) Advice and assistance to workers. In addition to the information 
and assistance to workers as required under paragraphs (a) and (b) of 
this section, State agencies shall--
    (1) Advise each worker who applies for unemployment insurance under 
the State law of the benefits available under subparts B through E of 
this part and the procedures and deadlines for applying for such 
benefits.
    (2) Facilitate the early filing of petitions under section 221 of 
the Act andSec. 617.4(b) for any workers that the agency considers are 
likely to be eligible for benefits. State agencies shall utilize 
information received by the State's dislocated worker unit to facilitate 
the early filing of petitions under section 221 of the Act by workers 
potentially adversely affected by imports.
    (3) Advise each adversely affected worker to apply for training 
underSec. 617.22(a) before, or at the same time as, the worker applies 
for trade readjustment allowances under subpart B of this part.
    (4) Interview each adversely affected worker, as soon as 
practicable, regarding suitable training opportunities available to the 
worker underSec. 617.22(a)

[[Page 109]]

and review such opportunities with the worker.

[51 FR 45848, Dec. 22, 1986, as amended at 59 FR 927, Jan. 6, 1994]



              Subpart B_Trade Readjustment Allowances (TRA)



Sec.  617.10  Applications for TRA.

    (a) Before and after certification. An individual covered under a 
certification or a petition for certification may apply to a State 
agency for TRA. A determination shall be made at any time to the extent 
necessary to establish or protect an individual's entitlement to TRA or 
other TAA, but no payment of TRA or other TAA may be made by a State 
agency until a certification is made and the State agency determines 
that the individual is covered thereunder.
    (b) Timing of applications. An initial application for TRA, and 
applications for TRA for weeks of unemployment beginning before the 
initial application for TRA is filed, may be filed within a reasonable 
period of time after publication of the determination certifying the 
appropriate group of workers under section 223 of the Act. However, an 
application for TRA for a week of unemployment beginning after the 
initial application is filed shall be filed within the time limit 
applicable to claims for regular compensation under the applicable State 
law. For purposes of this paragraph (b), a reasonable period of time 
means such period of time as the individual had good cause for not 
filing earlier, which shall include, but not be limited to, the 
individual's lack of knowledge of the certification or misinformation 
supplied the individual by the State agency.
    (c) Applicable procedures. Applications shall be filed in accordance 
with this subpart B and on forms which shall be furnished to individuals 
by the State agency. The procedures for reporting and filing 
applications for TRA shall be consistent with this part 617 and the 
Secretary's ``Standard for Claim Filing, Claimant Reporting, Job Finding 
and Employment Services'', Employment Security Manual, part V, sections 
5000 et seq. (Appendix A of this part).
    (d) Advising workers to apply for training. State agencies shall 
advise each worker of the qualifying requirements for entitlement to TRA 
and other TAA benefits at the time the worker files an initial claim for 
State UI, and shall advise each adversely affected worker to apply for 
training under subpart C of this part before, or at the same time, the 
worker applies for TRA, as required bySec. 617.4(e)(1) and (3).

[51 FR 45848, Dec. 22, 1986, as amended at 59 FR 928, 943, Jan. 6, 1994]



Sec.  617.11  Qualifying requirements for TRA.

    (a) Basic qualifying requirements for entitlement--(1) [Reserved]
    (2) To qualify for TRA for any week of unemployment an individual 
must meet each of the following requirements of paragraphs (a)(2) (i) 
through (vii) of this section:
    (i) Certification. The individual must be an adversely affected 
worker covered under a certification.
    (ii) Separation. The individual's first qualifying separation (as 
defined in paragraph (t)(3)(i) ofSec. 617.3) before application for 
TRA must occur:
    (A) On or after the impact date of such certification; and
    (B) Before the expiration of the two-year period beginning on the 
date of such certification, or, if earlier, before the termination date, 
if any, of such certification.
    (iii) Wages and employment. (A) In the 52-week period (i.e., 52 
consecutive calendar weeks) ending with the week of the individual's 
first qualifying separation, or any subsequent total qualifying 
separation under the same certification, the individual must have had at 
least 26 weeks of employment at wages of $30 or more a week in adversely 
affected employment with a single firm or subdivision of a firm. 
Evidence that an individual meets this requirement shall be obtained as 
provided inSec. 617.12. Employment and wages covered under more than 
one certification may not be combined to qualify for TRA.
    (B)(1) For the purposes of paragraph (a)(2)(iii) of this section, 
any week in which such individual--

[[Page 110]]

    (i) Is on employer-authorized leave from such adversely affected 
employment for purposes of vacation, sickness, injury, maternity, or 
inactive duty or active duty military service for training, or
    (ii) Does not work in such adversely affected employment because of 
a disability compensable under a workers' compensation law or plan of a 
State or the United States, or
    (iii) Had adversely affected employment interrupted to serve as a 
full-time representative of a labor organization in such firm or 
subdivision, or
    (iv) Is on call-up for the purpose of active duty in a reserve 
status in the Armed Forces of the United States (if such week began 
after August 1, 1990), provided such active duty is ``Federal service'' 
as defined in part 614 of this chapter,

shall be treated as a week of employment at wages of $30 or more;
    (2) Provided, that--
    (i) Not more than 7 weeks in the case of weeks described in 
paragraph (a)(2)(iii)(B)(1) (i) or (iii) of this section, or both, and
    (ii) Not more than 26 weeks described in paragraph (a)(2)(iii)(B)(1) 
(ii) or (iv) of this section,

may be treated as weeks of employment for purposes of paragraph 
(a)(2)(iii) of this section.
    (C) Wages and employment creditable under paragraph (a)(2)(iii) of 
this section shall not include employment or wages earned or paid for 
employment which is contrary to or prohibited by any Federal law.
    (iv) Entitlement to UI. The individual must have been entitled to 
(or would have been entitled to if the individual had applied therefor) 
UI for a week within the benefit period--
    (A) in which the individual's first qualifying separation occurred, 
or
    (B) which began (or would have begun) by reason of the filing of a 
claim for UI by the individual after such first qualifying separation.
    (v) Exhaustion of UI. The individual must:
    (A) Have exhausted all rights to any UI to which the individual was 
entitled (or would have been entitled if the individual had applied 
therefor); and
    (B) Not have an unexpired waiting period applicable to the 
individual for any such UI.
    (vi) Extended Benefit work test. (A) The individual must--
    (1) Accept any offer of suitable work, as defined inSec. 
617.3(kk), and actually apply for any suitable work the individual is 
referred to by the State agency, and
    (2) Actively engage in seeking work and furnish the State agency 
tangible evidence of such efforts each week, and
    (3) Register for work and be referred by the State agency to 
suitable work,

in accordance with those provisions of the applicable State law which 
apply to claimants for Extended Benefits and which are consistent with 
part 615 of this chapter.
    (B) The Extended Benefit work test shall not apply to an individual 
with respect to claims for TRA for weeks of unemployment beginning prior 
to the filing of an initial claim for TRA, nor for any week which begins 
before the individual is notified that the individual is covered by a 
certification issued under the Act and is fully informed of the Extended 
Benefit work test requirements of paragraph (a)(2)(vi) of this section 
andSec. 617.17. Prior to such notification and advice, the individual 
shall not be subject to the Extended Benefit work test requirements, nor 
to any State timely filing requirement, but shall be required to be 
unemployed and able to work and available for work with respect to any 
such week except as provided inSec. 617.17(b)(2) for workers enrolled 
in, or participating in, a training program approved underSec. 
617.22(a).
    (vii) Participation in training. (A) The individual must--
    (1) Be enrolled in or participating in a training program approved 
pursuant toSec. 617.22(a), or
    (2) Have completed a training program approved underSec. 
617.22(a), after a total or partial separation from adversely affected 
employment within the certification period of a certification issued 
under the Act, or
    (3) Have received from the State agency a written statement under 
Sec.  617.19 waiving the participation in training requirement for the 
individual.

[[Page 111]]

    (B) The participation in training requirement of paragraph 
(a)(2)(vii) of this section shall not apply to an individual with 
respect to claims for TRA for weeks of unemployment beginning prior to 
the filing of an initial claim for TRA, nor for any week which begins 
before the individual is notified that the individual is covered by a 
certification issued under the Act and is fully informed of the 
participation in training requirement of paragraph (a)(2)(vii) of this 
section andSec. 617.19.
    (C) The participation in training requirement of paragraph 
(a)(2)(vii) of this section shall apply, as a qualifying requirement for 
TRA, to an individual with respect to claims for TRA for weeks of 
unemployment commencing on or after November 21, 1988, and beginning 
with the first week following the week in which a certification covering 
the individual is issued under the Act, unless the State agency has 
issued a written statement to the individual underSec. 617.19 waiving 
the participation in training requirement for the individual.
    (D) For purposes of paragraph (a)(2)(vii) of this section, the 
following definitions shall apply:
    (1) Enrolled in training. A worker shall be considered to be 
enrolled in training when the worker's application for training is 
approved by the State agency and the training institution has furnished 
written notice to the State agency that the worker has been accepted in 
the approved training program which is to begin within 30 calendar days 
of the date of such approval. (A waiver underSec. 617.19 shall not be 
required for an individual who is enrolled in training as defined 
herein.)
    (2) Completed training. A worker shall be considered to have 
completed a training program if the training program was approved, or 
was approvable and is approved, pursuant toSec. 617.22, and the 
training was completed subsequent to the individual's total or partial 
separation from adversely affected employment within the certification 
period of a certification issued under the Act, and the training 
provider has certified that all the conditions for completion of the 
training program have been satisfied.
    (3)-(4) [Reserved]
    (b) First week of entitlement. The first week any individual may be 
entitled to a payment of basic TRA shall be the later of:
    (1) The first week beginning more than 60 days after the date of the 
filing of the petition which resulted in the certification under which 
the individual is covered; or
    (2) The first week beginning after the individual's exhaustion of 
all rights to UI including waiting period credit, as determined under 
Sec.  617.11(a)(2).

[59 FR 928, Jan. 6, 1994, as amended at 71 FR 35515, June 21, 2006]



Sec.  617.12  Evidence of qualification.

    (a) State agency action. When an individual applies for TRA, the 
State agency having jurisdiction underSec. 617.50(a) shall obtain 
information necessary to establish:
    (1) Whether the individual meets the qualifying requirements in 
Sec.  617.11;
    (2) The individual's average weekly wage; and
    (3) For an individual claiming to be partially separated, the 
average weekly hours and average weekly wage in adversely affected 
employment.
    (b) Insufficient data. If information specified in paragraph (a) of 
this section is not available from State agency records or from any 
employer, the State agency shall require the individual to submit a 
signed statement setting forth such information as may be required for 
the State agency to make the determinations required by paragraph (a) of 
this section.
    (c) Verification. A statement made under paragraph (b) of this 
section shall be certified by the individual to be true to the best of 
the individual's knowledge and belief and shall be supported by evidence 
such as Forms W-2, paycheck stubs, union records, income tax returns, or 
statements of fellow workers, and shall be verified by the employer.
    (d) Determinations. The State agency shall make the necessary 
determinations on the basis of information obtained pursuant to this 
section, except that if, after reviewing information obtained under 
paragraph (b) of this section against other available data, including 
agency records, it concludes

[[Page 112]]

that such information is not reasonably accurate, it shall make 
appropriate adjustments and shall make the determination on the basis of 
the adjusted data.



Sec.  617.13  Weekly amounts of TRA.

    (a) Regular allowance. The amount of TRA payable for a week of total 
unemployment (including a week of training approved under subpart C of 
this part 617 or under the provisions of the applicabIe State law) shall 
be an amount equal to the most recent weekly benefit amount of UI 
(including dependents' allowances) payable to the individual for a week 
of total unemployment preceding the individual's first exhaustion of UI 
following the individual's first qualifying separation: Provided, that 
in a State in which weeks of UI are paid in varying amounts related to 
wages with separate employers, the weekly amount of TRA shall be 
calculated as it would be to pay extended compensation: Provided, 
further, that where a State calculates a base amount of UI and 
calculates dependents' allowances on a weekly supplemental basis. TRA 
weekly benefit amounts shall be calculated in the same manner and under 
the same terms and conditions as apply to claimants for UI, except that 
the base amount shall not change.
    (b) Increased allowance. An individual in training approved under 
subpart C of this part 617 who is thereby entitled for any week to TRA 
and a training allowance under any other Federal law for the training of 
workers shall be paid in the amount computed under paragraph (a) of this 
section or, if greater, the amount to which the individual would be 
entitled under such other Federal law if the individual applied for such 
allowance, as provided in section 232(b) of the Act. A payment under 
this paragraph (b) shall be in lieu of any training allowance to which 
the individual is entitled under such other Federal law.
    (c) Reduction of amount. An amount of TRA payabIe under paragraph 
(a) or (b) of this section for any week shall be reduced (but not below 
zero) by:
    (1) Income that is deductible from UI under the disqualifying income 
provisions of the applicable State law or Federal unemployment 
compensation law;
    (2) The amount of a training allowance (other than a training 
allowance referred to in paragraph (b) of this section) under any 
Federal law that the individual receives for such week, as provided in 
section 232(c) of the Act. This paragraph (c) shall apply to Veterans 
Educational Assistance, Pell Grants, Supplemental Educational 
Opportunity Grants, and other training allowances under any Federal law 
other than for the training of workers; and
    (3) Any amount that would be deductible from UI for days of absence 
from training under the provisions of the applicable State law which 
apply to individuals in approved training.

[51 FR 45848, Dec. 22, 1986, as amended at 53 FR 32349, Aug. 24, 1988]



Sec.  617.14  Maximum amount of TRA.

    (a) General rule. Except as provided under paragraph (b) of this 
section, the maximum amount of TRA payable to an individual under a 
certification shall be the amount determined by:
    (1) Multiplying by 52 the weekly amount of TRA payable to such 
individual for a week of total unemployment, as determined underSec. 
617.13(a); and
    (2) Subtracting from the product derived under paragraph (a)(1) of 
this section, the total sum of UI to which the individual was entitled 
(or would have been entitled if the individual had applied therefor) in 
the individual's first benefit period described inSec. 
617.11(a)(1)(iv) or, as appropriate,Sec. 617.11(a)(2)(iv). The 
individual's full entitlement shall be subtracted under this paragraph, 
without regard to the amount, if any, that was actually paid to the 
individual with respect to such benefit period.
    (b) Exceptions. The maximum amount of TRA determined under paragraph 
(a) of this section will not include:
    (1) The amount of dependents' allowances paid as a supplement to the 
base weekly amount determined underSec. 617.13(a);
    (2) The amount of the difference between the individual's weekly 
increased allowances determined underSec. 617.13(b) and the 
individual's weekly

[[Page 113]]

amount determined underSec. 617.13(a); and
    (3) The amounts paid for additional weeks determined underSec. 
617.15(b);

but nothing in this paragraph (b) shall affect an individual's 
eligibility for such supplemental, increased or additional allowances.
    (c) Reduction for Federal training allowance. (1) If a training 
allowance referred to inSec. 617.13(c)(2) is paid to an individual for 
any week of unemployment with respect to which the individual would be 
entitled (determined without regard to any disqualification underSec. 
617.18(b)(2)) to TRA, if the individual applied for TRA for such week, 
each week shall be deducted from the total number of weeks of TRA 
otherwise payable to the individual.
    (2) If the training allowance referred to in paragraph (c)(1) of 
this section is less than the amount of TRA otherwise payable to the 
individual for such week, the individual shall, when the individual 
applies for TRA for such week, be paid TRA in an amount not to exceed 
the amount equal to the difference between the individual's regular 
weekly TRA amount, as determined underSec. 617.13(a), and the amount 
of the training allowance paid to the individual for such week, as 
provided in section 232(c) of the Act.

[51 FR 45848, Dec. 22, 1986, as amended at 53 FR 32349, Aug. 24, 1988; 
54 FR 22277, May 23, 1989; 59 FR 931, Jan. 6, 1994]



Sec.  617.15  Duration of TRA.

    (a) Basic weeks. An individual shall not be paid basic TRA for any 
week beginning after the close of the 104-week eligibility period (as 
defined inSec. 617.3(m)(1)), which is applicable to the individual as 
determined under Sec.Sec. 617.3 (m)(1), 617.3(t), and 617.67(e).
    (b) Additional weeks. (1) To assist an individual to complete 
training approved under subpart C of this part, payments may be made as 
TRA for up to 26 additional weeks in the 26-week eligibility period (as 
defined inSec. 617.3(m)(2)) which is applicable to the individual as 
determined under Sec.Sec. 617.3(m)(2) and 617.67(f).
    (2) To be eligible for TRA for additional weeks, an individual must 
make a bona fide application for such training--
    (i) within 210 days after the date of the first certification under 
which the individual is covered, or
    (ii) if later, within 210 days after the date of the individual's 
most recent partial or total separation (as defined in Sec.Sec. 
617.3(cc) and 617.3(ll)) under such certification.
    (3) Except as provided in paragraph (d) of this section, payments of 
TRA for additional weeks may be made only for those weeks in the 26-week 
eligibility period during which the individual is actually participating 
fully in training approved underSec. 617.22(a).
    (c) Limit. The maximum TRA payable to any individual on the basis of 
a single certification is limited to the maximum amount of basic TRA as 
determined underSec. 617.14 plus additional TRA for up to 26 weeks as 
provided in paragraph (b) of this section.
    (d) Scheduled breaks in training. (1) An individual who is otherwise 
eligible will continue to be eligible for basic and additional weeks of 
TRA during scheduled breaks in training, but only if a scheduled break 
is not longer than 14 days, and the following additional conditions are 
met:
    (i) The individual was participating in the training approved under 
Sec.  617.22(a) immediately before the beginning of the break; and
    (ii) The break is provided for in the published schedule or the 
previously established schedule of training issued by the training 
provider or is indicated in the training program approved for the 
worker; and, further
    (iii) The individual resumes participation in the training 
immediately after the break ends.
    (2) A scheduled break in training shall include all periods within 
or between courses, terms, quarters, semesters and academic years of the 
approved training program.
    (3) No basic or additional TRA will be paid to an individual for any 
week which begins and ends within a scheduled break that is 15 days or 
more.
    (4) The days within a break in a training program that shall be 
counted in determining the number of days of the break for the purposes 
of paragraph (d) of this section shall include all calendar days 
beginning with the first day of the break and ending with the last

[[Page 114]]

day of the break, as provided for in the schedule of the training 
provider, except that any Saturday, Sunday, or official State or 
National holiday occurring during the scheduled break in training, on 
which training would not normally be scheduled in the training program 
if there were no break in training, shall not be counted in determining 
the number of days of the break for the purposes of paragraph (d) of 
this section.
    (5) When the worker is drawing basic TRA, the maximum amount of TRA 
payable is not affected by the weeks the worker does not receive TRA 
while in a break period, but the weeks will count against the 104-week 
eligibility period.
    (6) When the worker is drawing additional weeks of TRA to complete 
training, any weeks for which TRA is not paid will count against the 
continuous 26-week eligibility period and the number of weeks payable.

[59 FR 931, Jan. 6, 1994]



Sec.  617.16  Applicable State law.

    (a) What law governs. The applicable State law for any individual, 
for all of the purposes of this part 617, is the State law of the 
State--
    (1) In which the individual is entitled to UI (whether or not the 
individual has filed a claim therefor) immediately following the 
individual's first separation (as defined in paragraph (t)(1) ofSec. 
617.3), or
    (2) If the individual is not so entitled to UI under the State law 
of any State immediately following such first separation, or is entitled 
to UI under the Railroad Unemployment Insurance Act (RRUI), the State 
law of the State in which such first separation occurred.
    (b) Change of law. The State law determined under paragraph (a) of 
this section to be the applicable State law for an individual shall 
remain the applicable State law for the individual until the individual 
becomes entitled to UI under the State law of another State (whether or 
not the individual files a claim therefor).
    (c) UI entitlement. (1) An individual shall be deemed to be entitled 
to UI under a State law if the individual satisfies the base period 
employment and wage qualifying requirements of such State law.
    (2) In the case of a combined-wage claim (Part 616 of this chapter), 
UI entitlement shall be determined under the law of the paying State.
    (3) In case of a Federal UI claim, or a joint State and Federal UI 
claim (Parts 609 and 614 of this Chapter), UI entitlement shall be 
determined under the law of the State which is the applicable State for 
such claims.
    (d) RRUI claimants. If an individual is entitled to UI under the 
Railroad Unemployment Insurance Act, the applicable State law for 
purposes of paragraphs (a) and (b) of this section is the law of the 
State in which the individual's first qualifying separation occurs.
    (e) Liable State. The State whose State law is determined under this 
section to be the applicable State law for any individual shall be the 
liable State for the individual for all purposes of this part 617. Any 
State other than the liable State shall be an agent State.

[59 FR 932, Jan. 6, 1994]



Sec.  617.17  Availability and active search for work.

    (a) Extended Benefit work test applicable. Except as provided in 
paragraph (b) of this section, an individual shall, as a basic condition 
of entitlement to basic TRA for a week of unemployment--
    (1) be unemployed, as defined in the applicable State law for UI 
claimants, and
    (2) be able to work and available for work, as defined in the 
applicable State law for UI claimants, and
    (3) satisfy the Extended Benefit work test in each week for which 
TRA is claimed, as set forth in Sec.Sec. 617.11(a)(1) (vi) and 
617.11(a)(2)(vi).
    (b) Exceptions--(1) Prior to November 21, 1988. The conditions 
stated in paragraphs (a) and (b) of this section shall not be applicable 
to an individual actually participating in training approved under the 
applicable State law or underSec. 617.22(a), or during a scheduled 
break in the training program if (as determined for the purposes of 
Sec.  617.15 (d)) the individual participated in the training 
immediately before the beginning of the break and resumes participation 
in the training immediately

[[Page 115]]

after the break ends, unless the individual is ineligible or subject to 
disqualification under the applicable State law orSec. 617.18 (b)(2).
    (2) On and after November 21, 1988. The conditions stated in 
paragraphs (a)(2) and (a)(3) of this section shall not be applicable to 
an individual who is enrolled in or participating in a training program 
approved underSec. 617.22 (a), or during a break in the training 
program if (as determined for the purposes ofSec. 617.15(d)) the 
individual participated in the training immediately before the beginning 
of the break and resumes participation in the training immediately after 
the break ends.

[59 FR 932, Jan. 6, 1994]



Sec.  617.18  Disqualifications.

    (a) State law applies. Except as stated in paragraph (b) of this 
section andSec. 617.55(b), an individual shall not be paid TRA for any 
week of unemployment the individual is or would be disqualified to 
receive UI under the disqualification provisions of the applicable State 
law, including the provisions of the applicable State law which apply to 
EB claimants and which are consistent with section 202(a)(3) of the 
Federal-State Extended Unemployment Compensation Act of 1970.
    (b) Disqualification of trainees--(1) State law inapplicable. A 
State law shall not be applied to disqualify an individual from 
receiving either UI or TRA because the individual:
    (i) Is enrolled in or is participating in a training program 
approved underSec. 617.22(a); or
    (ii) Refuses work to which the individual has been referred by the 
State agency, if such work would require the individual to discontinue 
training, or if added to hours of training would occupy the individual 
more than 8 hours a day or 40 hours a week, except that paragraph 
(b)(1)(ii) of this section shall not apply to an individual who is 
ineligible under paragraph (b)(2) of this section; or
    (iii) Quits work, if the individual was employed in work which was 
not suitable (as defined inSec. 617.22(a)(1)), and it was reasonable 
and necessary for the individual to quit work to begin or continue 
training approved for the individual underSec. 617.22(a).
    (2) Trainees ineligible. (i) An individual who, without justifiable 
cause, fails to begin participation in a training program which is 
approved underSec. 617.22(a), or ceases to participate in such 
training, or for whom a waiver is revoked pursuant toSec. 617.19(c), 
shall not be eligible for basic TRA, or any other payment under this 
part 617, for the week in which such failure, cessation, or revocation 
occurred, or any succeeding week thereafter until the week in which the 
individual begins or resumes participation in a training program that is 
approved underSec. 617.22(a).
    (ii) For purposes of this section and other provisions of this Part 
617, the following definitions shall be used:
    (A) Failed to begin participation. A worker shall be determined to 
have failed to begin participation in a training program when the worker 
fails to attend all scheduled training classes and other training 
activities in the first week of the training program, without 
justifiable cause.
    (B) Ceased participation. A worker shall be determined to have 
ceased participation in a training program when the worker fails to 
attend all scheduled training classes and other training activities 
scheduled by the training institution in any week of the training 
program, without justifiable cause.
    (C) Justifiable cause. For the purposes of paragraph (b)(2) of this 
section, the term ``justifiable cause'' means such reasons as would 
justify an individual's conduct when measured by conduct expected of a 
reasonable individual in like circumstances, including but not limited 
to reasons beyond the individual's control and reasons related to the 
individual's capability to participate in or complete an approved 
training program.
    (c) Disqualification while in OJT. In no case may an individual 
receive TRA for any week with respect to which the worker is engaged in 
on-the-job training.

[51 FR 45848, Dec. 22, 1986, as amended at 53 FR 32350, Aug. 24, 1988; 
59 FR 932, Jan. 6, 1994]



Sec.  617.19  Requirement for participation in training.

    (a) In general--(1) Basic requirement. (i) All individuals otherwise 
entitled to

[[Page 116]]

basic TRA, for each week, must either be enrolled in or participating in 
a training program approved underSec. 617.22(a), or have completed a 
training program approved underSec. 617.22(a), as provided inSec. 
617.11(a)(2)(vii), in order to be entitled to basic TRA payments for any 
such week (except for continuation of payments during scheduled breaks 
in training of 14 days or less under the conditions stated inSec. 
617.15(d)). The training requirement of paragraph (a)(1)(i) of this 
section shall be waived in writing on an individual basis, solely in 
regard to entitlement to basic TRA, if approval of training for the 
individual is not feasible or is not appropriate, as determined in 
accordance with paragraph (a)(2) of this section.
    (ii) As a principal condition of entitlement to additional TRA 
payments, all individuals must actually be participating in a training 
program approved underSec. 617.22(a) for each week, and for all weeks 
beginning on and after November 21, 1988 (except for continuation of 
payments during breaks in training under the conditions stated inSec. 
617.15(d)). Paragraph (a)(2) of this section is not applicable in regard 
to additional TRA, and the participation in training requirement of 
paragraph (a)(1)(ii) of this section may not be waived under any 
circumstances.
    (2) Waiver of participation requirement. When it is determined, in 
accordance with paragraph (a)(2) of this section, that it is not 
feasible or is not appropriate (as such terms are defined in paragraph 
(b) of this section) to approve a training program for an individual 
otherwise entitled to basic TRA, the individual shall be furnished a 
formal written notice of waiver, with an explanation of the reason(s) 
for the waiver and a statement of why training is not feasible or is not 
appropriate in the case of such individual. At a minimum, the written 
statement furnished to the individual shall contain information required 
bySec. 617.50(e) as well as the following information:
    (i) Name and social security number of the individual;
    (ii) Petition number under which the worker was certified;
    (iii) A statement why the agency has determined that it is not 
feasible or is not appropriate to approve training for the individual at 
that time, and the reason(s) for the finding;
    (iv) A statement that the waiver will be revoked at any time that 
feasible and appropriate training becomes available;
    (v) Any other advice or information the State agency deems 
appropriate in informing the individual;
    (vi) Signature block (with signature) for the appropriate State 
official; and
    (vii) Signature block (with signature) for the worker's 
acknowledgement of receipt.
    (3) Denial of a waiver. In any case in which a determination is made 
to deny to any individual a waiver of the participation requirement, the 
individual shall be furnished a formal written notice of denial of 
waiver, which shall contain all of the information required of formal 
written notices under paragraph (a)(2) of this section.
    (4) Procedure. Any determination under paragraph (a)(2) or paragraph 
(a)(3) of this section shall be a determination to which Sec.Sec. 
617.50 and 617.51 apply, including the requirement that any written 
notice furnished to an individual shall include notice of the 
individual's appeal rights as is provided inSec. 617.50(e).
    (b) Reasons for issuing a waiver. (1) For the purposes of paragraphs 
(a)(2) and (a)(3) of this section, a waiver of the participation in 
training requirement shall be issued to an individual only upon a 
supported finding that approval of aSec. 617.22(a) training program 
for that individual is not feasible or is not appropriate at that time.
    (i) Feasible and appropriate. For the purposes of this section:
    (A) Feasible. The term feasible means:
    (1) Training is available at that time which meets all the criteria 
ofSec. 617.22(a);
    (2) The individual is so situated as to be able to take full 
advantage of the training opportunity and complete the training; and
    (3) Funding is available to pay the full costs of the training and 
any transportation and subsistence expenses which are compensable. The 
funding referred to in paragraph (b)(1)(i)(A)(3) of this section 
includes not only TAA program funds but also all other funds available 
under any of the provisions of

[[Page 117]]

the Title I, Subchapter B of the Workforce Investment Act or any other 
Federal, State or private source that may be utilized for training 
approvable underSec. 617.22(a). Further, the individual's situation in 
respect to undertaking training (as referred to in paragraph 
(b)(1)(i)(A)(2) of this section) shall include taking into account 
personal circumstances that preclude the individual from being able to 
participate in and complete the training program, such as the 
availability of transportation, the ability to make arrangements for 
necessary child care, and adequate financial resources if the weeks of 
training exceeds the duration of UI and TRA payments.
    (B) Appropriate. The term appropriate means being suitable or 
compatible, fitting, or proper. Appropriate, therefore, refers to 
suitability of the training for the worker (including whether there is a 
reasonable prospect which is reasonably foreseeable that the individual 
will be reemployed by the firm from which separated), and compatibility 
of the training for the purposes of the TAA Program. In these respects, 
suitability of training for the individual is encompassed within the 
several criteria inSec. 617.22 (a), and compatibility with the program 
is covered by the various provisions of subpart C of this part which 
describe the types of training approvable underSec. 617.22(a) and the 
limitations thereon.
    (ii) Basis for application. Whether training is feasible or 
appropriate at any given time is determined by finding whether, at that 
time, training suitable for the worker is available, the training is 
approvable under subpart C of this part including the criteria inSec. 
617.22(a), the worker is so situated as to be able to take full 
advantage of the training and satisfactorily complete the training, full 
funding for the training is available from one or more sources in 
accordance with Sec.Sec. 617.24 and 617.25, the worker has the 
financial resources to complete the training when the duration of the 
training program exceeds the worker's eligibility for TRA, and the 
training will commence within 30 days of approval.
    (2) Particular applications. The reasons for any determination that 
training is not feasible or is not appropriate shall be in accord with 
the following:
    (i) Not feasible because--
    (A) The beginning date of approved training is beyond 30 days, as 
required by the definition for ``Enrolled in training'' inSec. 
617.11(a)(2)(vii)(D),
    (B) Training is not reasonably available to the individual,
    (C) Training is not available at a reasonable cost,
    (D) Funds are not available to pay the total costs of training, or
    (E) Personal circumstances such as health or financial resources, 
preclude participation in training or satisfactory completion of 
training,
    (F) Other (explain).
    (ii) Not appropriate because--
    (A)(1) The firm from which the individual was separated plans to 
recall the individual within the reasonably foreseeable future (State 
agencies must verify planned recalls with the employer),
    (2) Planned recall. For the purpose of determining whether the 
recall or reemployment of an individual is reasonably foreseeable (for 
the purposes of this section andSec. 617.22), either a specific or 
general type of recall (as set out) shall be deemed to be sufficient.
    (i) Specific recall. A specific recall is where an individual or 
group of individuals who was separated from employment is identified and 
notified by the employer to return to work within a specified time 
period.
    (ii) General recall. A general recall is where the employer 
announces an intention to recall an individual or group of individuals, 
or by other action reasonably signals an intent to recall, without 
specifying any certain date or specific time period.
    (iii) Reasonably foreseeable. For purposes of determining whether 
training should be denied and a training waiver granted, because of a 
planned recall that is reasonably foreseeable, such a planned recall 
includes a specific recall and also includes a general recall (as 
defined in paragraph (b)(2)(ii)(A)(2) of this section) if the general 
recall in each individual's case is reasonably expected to occur before 
the individual exhausts eligibility for any regular UI payments for 
which the individual is or may become entitled. A general recall,

[[Page 118]]

in which the timing of the recall is reasonably expected to occur after 
the individual's exhaustion of any regular UI to which the individual is 
or may become entitled, shall not be treated as precluding approval of 
training, but shall be treated as any other worker separation for these 
purposes.
    (B) The duration of training suitable for the individual exceeds the 
individual's maximum entitlement to basic and additional TRA payments 
and the individual cannot assure financial responsibility for completing 
the training program,
    (C) The individual possesses skills for ``suitable employment'' and 
there is a reasonable expectation of employment in the foreseeable 
future, or
    (D) Other (explain).
    (3) Waivers and able and available. An individual who has been 
furnished a written notice of waiver under paragraph (a)(2) of this 
section (or denial of waiver under paragraph (a)(3) of this section) 
shall be subject to all of the requirements ofSec. 617.17(a), which 
shall continue until the individual is enrolled in a training program as 
required by paragraph (a)(2)(vii) ofSec. 617.11.
    (c) Waiver review and revocations. (1) State agencies must have a 
procedure for reviewing regularly (i.e., every 30 days or less) all 
waivers issued under this section to individuals, to ascertain that the 
conditions upon which the waivers were granted continue to exist. In any 
case in which the conditions have changed--i.e., training has become 
feasible and appropriate--then the waiver must be revoked, and a written 
notice of revocation shall be furnished to the individual involved.
    (2) In addition to the periodic reviews required by paragraph (c)(1) 
of this section, State agencies must have a procedure for revoking 
waivers in individual cases promptly whenever a change in circumstances 
occurs. For example, a written notice of revocation shall be issued to 
the individual concurrent with the approval of the training in which the 
individual has enrolled (if such training is scheduled to commence 
within 30 days), and shall not be issued prior to such approval.
    (3) State agencies may incorporate a revocation section in the 
waiver form or on a separate revocation form. Any determination under 
paragraph (c) of this section shall be a determination to which 
Sec.Sec. 617.50 and 617.51 apply. The information included in a 
written notice of revocation issued under this paragraph (c) shall 
include all of the information required for written notices issued under 
paragraph (a)(2) of this section.
    (d) Recordkeeping and reporting. (1) State agencies must develop 
procedures for compiling and reporting on the number of waivers issued 
and revoked, by reason, as specified in paragraphs (b) and (c) of this 
section, and report such data to the Department of Labor as requested by 
the Department.
    (2) State agencies are not required to forward copies of individual 
waiver and revocation notices to the Department of Labor, unless 
specifically requested by the Department. However, each State agency 
shall retain a copy of every individual waiver and revocation notice 
issued by the State, for such period of time as the Department requires.

(Approved by the Office of Management and Budget under control number 
1205-0016)

[59 FR 932, Jan. 6, 1994, as amended at 71 FR 35515, June 21, 2006]



                     Subpart C_Reemployment Services



Sec.  617.20  Responsibilities for the delivery of reemployment services.

    (a) State agency referral. Cooperating State agencies shall be 
responsible for:
    (1) Advising each adversely affected worker to apply for training 
with the State agency responsible for reemployment services, while the 
worker is receiving UI payments, and at the time the individual files an 
initial claim for TRA; and
    (2) Referring each adversely affected worker to the State agency 
responsible for training and other reemployment services in a timely 
manner.
    (b) State agency responsibilities. The responsibilities of 
cooperating State agencies under subpart C of this part include, but are 
not limited to:
    (1) Interviewing each adversely affected worker regarding suitable 
training opportunities reasonably available

[[Page 119]]

to each individual under subpart C of this part, reviewing such 
opportunities with each individual, informing each individual of the 
requirement for participation in training as a condition for receiving 
TRA, and accepting each individual's application for training. Such 
training may be approved for any adversely affected worker at any time 
after a certification is issued and the worker is determined to be 
covered without regard to whether the worker has exhausted all rights to 
unemployment insurance;
    (2) Registering adversely affected workers for work;
    (3) Informing adversely affected workers of the reemployment 
services and allowances available under the Act and this Part 617, the 
application procedures, the filing date requirements for such 
reemployment services and the training requirement for receiving TRA;
    (4) Determining whether suitable employment, as defined inSec. 
617.22(a)(1), is available;
    (5) Providing counseling, testing, placement, and supportive 
services;
    (6) Providing or procuring self-directed job search training, when 
necessary;
    (7) Providing training, job search and relocation assistance;
    (8) Developing a training plan with the individual;
    (9) Determining which training institutions offer training programs 
at a reasonable cost and with a reasonable expectation of employment 
following the completion of such training, and procuring such training;
    (10) Documenting the standards and procedures used to select 
occupations and training institutions in which training is approved;
    (11) Making referrals and approving training programs;
    (12) Monitoring the progress of workers in approved training 
programs;
    (13) Developing, and periodically reviewing and updating 
reemployment plans for adversely affected workers;
    (14) Developing and implementing a procedure for reviewing training 
waivers and revocations at least every 30 days to determine whether the 
conditions under which they are issued have changed; and
    (15) Coordinating the administration and delivery of employment 
services, benefits, training, and supplemental assistance for adversely 
affected workers with programs under the Act and under Title I, 
Subchapter B of the Workforce Investment Act.

[59 FR 934, Jan. 6, 1994, as amended at 71 FR 35515, June 21, 2006]



Sec.  617.21  Reemployment services and allowances.

    Reemployment services and allowances shall include, as appropriate, 
the services and allowances as set forth in this section, provided that 
those services included within the scope of paragraphs (a) through (e) 
of this section shall be provided for under any other Federal law other 
than the Act.
    (a) Employment registration. To ensure, so far as practical, that 
individuals are placed in jobs which utilize their highest skills and 
that applicants qualified for job openings are appropriately referred, 
applications for registration shall be taken on adversely affected 
workers who apply for reemployment services.
    (b) Employment counseling. When local job opportunities are not 
readily available, counseling shall be used to assist individuals to 
gain a better understanding of themselves in relation to the labor 
market so that they can more realistically choose or change an 
occupation or make a suitable job adjustment.
    (c) Vocational testing. Testing shall be used to determine which 
individual skills or potentials can be developed by appropriate 
training.
    (d) Job development. A State agency shall develop jobs for 
individuals by soliciting job interviews from public or private 
employers and shall work with potential employers to customize or 
restructure particular jobs to meet individual needs.
    (e) Supportive services. Supportive services shall be provided so 
individuals can obtain or retain employment or participate in employment 
and training programs leading to eventual placement in permanent 
employment. Such services may include work orientation, basic education, 
communication skills, child care, and any other

[[Page 120]]

services necessary to prepare an individual for full employment in 
accordance with the individual's capabilities and employment 
opportunities.
    (f) On-the-job training (OJT). OJT is training, in the public or 
private sector, and may be provided to an individual who meets the 
conditions for approval of training, as provided inSec. 617.22(a), and 
who has been hired by the employer, while the individual is engaged in 
productive work which provides knowledge or skills essential to the full 
and adequate performance of the job.
    (g) Classroom training. This training activity is any training of 
the type normally conducted in a classroom setting, including vocational 
education, and may be provided to individuals when the conditions for 
approval of training are met, as provided inSec. 617.22(a), to impart 
technical skills and information required to perform a specific job or 
group of jobs. Training designed to enhance the employability of 
individuals by upgrading basic skills, through the provision of courses 
such as remedial education or English-as-a-second-language, shall be 
considered as remedial education approvable underSec. 617.22(a) if the 
criteria for approval of training underSec. 617.22(a) are met.
    (h) Self-directed job search. Self-directed job search programs 
shall be initiated to assist individuals in developing skills and 
techniques for finding a job. Such programs vary in design and operation 
and call for a carefully structured approach to individual needs. There 
are basic elements or activities common to all approaches. These 
include:
    (1) Job search workshop. A short (1-3 days) seminar designed to 
provide participants with knowledge on how to find jobs, including labor 
market information, applicant resume writing, interviewing techniques, 
and finding job openings.
    (2) Job finding club. Encompasses all elements of the Job Search 
Workshop plus a period (1-2 weeks) of structured, supervised application 
where participants actually seek employment.
    (i) Job search allowances. The individual, if eligible, shall be 
provided job search allowances under subpart D of this part 617 to 
defray the cost of seeking employment outside of the commuting area.
    (j) Relocation allowances. The individual, if eligible, shall be 
provided relocation allowances under subpart E of this part 617 to 
defray the cost of moving to a new job outside of the commuting area.

[51 FR 45848, Dec. 22, 1986, as amended at 59 FR 934, Jan. 6, 1994]



Sec.  617.22  Approval of training.

    (a) Conditions for approval. Training shall be approved for an 
adversely affected worker if the State agency determines that:
    (1) There is no suitable employment (which may include technical and 
professional employment) available for an adversely affected worker.
    (i) This means that for the worker for whom approval of training is 
being considered under this section, no suitable employment is available 
at that time for that worker, either in the commuting area, as defined 
inSec. 617.3(k), or outside the commuting area in an area in which the 
worker desires to relocate with the assistance of a relocation allowance 
under subpart E of this part, and there is no reasonable prospect of 
such suitable employment becoming available for the worker in the 
foreseeable future. For the purposes of paragraph (a)(1) of this section 
only, the term ``suitable employment'' means, with respect to a worker, 
work of a substantially equal or higher skill level than the worker's 
past adversely affected employment, and wages for such work at not less 
that 80 percent of the worker's average weekly wage.
    (2) The worker would benefit from appropriate training. (i) This 
means that there is a direct relationship between the needs of the 
worker for skills training or remedial education and what would be 
provided by the training program under consideration for the worker, and 
that the worker has the mental and physical capabilities to undertake, 
make satisfactory progress in, and complete the training. This includes 
the further criterion that the individual will be job ready on 
completion of the training program.
    (3) There is a reasonable expectation of employment following 
completion of such

[[Page 121]]

training. (i) This means that, for that worker, given the job market 
conditions expected to exist at the time of the completion of the 
training program, there is, fairly and objectively considered, a 
reasonable expectation that the worker will find a job, using the skills 
and education acquired while in training, after completion of the 
training. Any determination under this criterion must take into account 
that ``a reasonable expectation of employment'' does not require that 
employment opportunities for the worker be available, or offered, 
immediately upon the completion of the approved training. This 
emphasizes, rather than negates, the point that there must be a fair and 
objective projection of job market conditions expected to exist at the 
time of completion of the training.
    (4) Training approved by the Secretary is reasonably available to 
the worker from either governmental agencies or private sources (which 
may include area vocational technical education schools, as defined in 
Carl D. Perkins Vocational and Applied Technology Education Act, and 
employers). (i) This means that training is reasonably accessible to the 
worker within the worker's commuting area at any governmental or private 
training (or education) provider, particularly including on-the-job 
training with an employer, and it means training that is suitable for 
the worker and meets the other criteria in paragraph (a) of this 
section. It also means that emphasis must be given to finding accessible 
training for the worker, although not precluding training outside the 
commuting area if none is available at the time within the worker's 
commuting area. Whether the training is within or outside the commuting 
area, the training must be available at a reasonable cost as prescribed 
in paragraph (a)(6) of this section.
    (ii) In determining whether or not training is reasonably available, 
first consideration shall be given to training opportunities available 
within the worker's normal commuting area. Training at facilities 
outside the worker's normal commuting area should be approved only if 
such training is not available in the area or the training to be 
provided outside the normal commuting area will involve less charges to 
TAA funds.
    (5) The worker is qualified to undertake and complete such training. 
(i) This emphasizes the worker's personal qualifications to undertake 
and complete approved training. Evaluation of the worker's personal 
qualifications must include the worker's physical and mental 
capabilities, educational background, work experience and financial 
resources, as adequate to undertake and complete the specific training 
program being considered.
    (ii) Evaluation of the worker's financial ability shall include an 
analysis of the worker's remaining weeks of UI and TRA payments in 
relation to the duration of the training program. If the worker's UI and 
TRA payments will be exhausted before the end of the training program, 
it shall be ascertained whether personal or family resources will be 
available to the worker to complete the training. It must be noted on 
the worker's record that financial resources were discussed with the 
worker before the training was approved.
    (iii) When adequate financial resources will not be available to the 
worker to complete a training program which exceeds the duration of UI 
and TRA payments, the training shall not be approved and consideration 
shall be given to other training opportunities available to the worker.
    (6) Such training is suitable for the worker and available at a 
reasonable cost. (i) Such training means the training being considered 
for the worker. Suitable for the worker means that paragraph (a)(5) of 
this section is met and that the training is appropriate for the worker 
given the worker's capabilities, background and experience.
    (ii) Available at a reasonable cost means that training may not be 
approved at one provider when, all costs being considered, training 
substantially similar in quality, content and results can be obtained 
from another provider at a lower total cost within a similar time frame. 
It also means that training may not be approved when the costs of the 
training are unreasonably high in comparison with the average costs of 
training other workers in similar occupations at other providers.

[[Page 122]]

This criterion also requires taking into consideration the funding of 
training costs from sources other than TAA funds, and the least cost to 
TAA funding of providing suitable training opportunities to the worker. 
Greater emphasis will need to be given to these elements in determining 
the reasonable costs of training, particularly in view of the 
requirements inSec. 617.11(a) (2) and (3) that TRA claimants be 
enrolled in and participate in training.
    (iii) For the purpose of determining reasonable costs of training, 
the following elements shall be considered:
    (A) Costs of a training program shall include tuition and related 
expenses (books, tools, and academic fees), travel or transportation 
expenses, and subsistence expenses;
    (B) In determining whether the costs of a particular training 
program are reasonable, first consideration must be given to the lowest 
cost training which is available within the commuting area. When 
training, substantially similar in quality, content and results, is 
offered at more than one training provider, the lowest cost training 
shall be approved; and
    (C) Training at facilities outside the worker's normal commuting 
area that involves transportation or subsistence costs which add 
substantially to the total costs shall not be approved if other 
appropriate training is available.
    (b) Allowable amounts for training. In approving a worker's 
application for training, the conditions for approval in paragraph (a) 
of this section must be found to be satisfied, including assurance that 
the training is suitable for the worker, is at the lowest reasonable 
cost, and will enable the worker to obtain employment within a 
reasonable period of time. An application for training shall be denied 
if it is for training in an occupational area which requires an 
extraordinarily high skill level and for which the total costs of the 
training are substantially higher than the costs of other training which 
is suitable for the worker.
    (c) Previous approval of training under State law. Training 
previously approved for a worker under State law or other authority is 
not training approved under paragraph (a) of this section. Any such 
training may be approved under paragraph (a) of this section, if all of 
the requirements and limitations of paragraph (a) of this section and 
other provisions of Subpart C of this part are met, but such approval 
shall not be retroactive for any of the purposes of this Part 617, 
including payment of the costs of the training and payment of TRA to the 
worker participating in the training. However, in the case of a 
redetermination or decision reversing a determination denying approval 
of training, for the purposes of this Part 617 such redetermination or 
decision shall be given effect retroactive to the issuance of the 
determination that was reversed by such redetermination or decision; but 
no costs of training may be paid unless such costs actually were 
incurred for training in which the individual participated, and no 
additional TRA may be paid with respect to any week the individual was 
not actually participating in the training.
    (d) Applications. Applications for, selection for, approval of, or 
referral to training shall be filed in accordance with this subpart C 
and on forms which shall be furnished to individuals by the State 
agency.
    (e) Determinations. Selection for, approval of, or referral of an 
individual to training under this subpart C, or a decision with respect 
to any specific training or non-selection, non-approval, or non-referral 
for any reason shall be a determination to which Sec.Sec. 617.50 and 
617.51 apply.
    (f) Length of training and hours of attendance. The State agency 
shall determine the appropriateness of the length of training and the 
hours of attendance as follows:
    (1) The training shall be of suitable duration to achieve the 
desired skill level in the shortest possible time;
    (2) Length of training. The maximum duration for any approvable 
training program is 104 weeks (during which training is conducted) and 
no individual shall be entitled to more than one training program under 
a single certification.
    (3) Training program. (i) For purposes of this Part 617, a training 
program may consist of a single course or group

[[Page 123]]

of courses which is designed and approved by the State agency for an 
individual to meet a specific occupational goal.
    (ii) When an approved training program involves more than one course 
and involves breaks in training (within or between courses, or within or 
between terms, quarters, semesters and academic years), all such breaks 
in training are subject to the ``14-day break in training'' provision in 
Sec.  617.15(d), for purposes of receiving TRA payments. An individual's 
approved training program may be amended by the State agency to add a 
course designed to satisfy unforeseen needs of the individual, such as 
remedial education or specific occupational skills, as long as the 
length of the amended training program does not exceed the 104-week 
training limitation in paragraph (f)(2) of this section.
    (4) Full-time training. Individuals in TAA approved training shall 
attend training full time, and when other training is combined with OJT 
attendance at both shall be not less than full-time. The hours in a day 
and days in a week of attendance in training shall be full-time in 
accordance with established hours and days of training of the training 
provider.
    (g) Training of reemployed workers. Adversely affected workers who 
obtain new employment which is not suitable employment, as described in 
Sec.  617.22(a)(1), and have been approved for training may elect to:
    (1) Terminate their jobs, or
    (2) Continue in full- or part-time employment, to undertake such 
training, and shall not be subject to ineligibility or disqualification 
for UI or TRA as a result of such termination or reduction in 
employment.
    (h) Fees prohibited. In no case shall an individual be approved for 
training under this subpart C for which the individual is required to 
pay a fee or tuition.
    (i) Training outside the United States. In no case shall an 
individual be approved for training under this subpart C which is 
conducted totally or partially at a location outside the United States.

[51 FR 45848, Dec. 22, 1986, as amended at 53 FR 32350, Aug. 24, 1988; 
59 FR 935, Jan. 6, 1994; 71 FR 35515, June 21, 2006]



Sec.  617.23  Selection of training methods and programs.

    (a) State agency responsibilities. If suitable employment as 
described inSec. 617.22(a)(1), is not otherwise available to an 
individual or group of individuals, it is the responsibility of the 
State agency to explore, identify, develop and secure training 
opportunities and to establish linkages with other public and private 
agencies, Workforce Investment Boards (WIBs), employers, and Workforce 
Investment Act (WIA) service delivery area (SDA) grant recipients, as 
appropriate, which return adversely affected workers to employment as 
soon as possible.
    (b) Firm-specific retraining program. To the extent practicable 
before referring an adversely affected worker to approved training, the 
State agency shall consult with the individual's adversely affected firm 
and certified or recognized union, or other authorized representative, 
to develop a retraining program that meets the firm's staffing needs and 
preserves or restores the employment relationship between the individual 
and the firm. The fact that there is no need by other employers in the 
area for individuals in a specific occupation for which training is 
undertaken shall not preclude the development of an individual 
retraining program for such occupation with the adversely affected firm.
    (c) Methods of training. Adversely affected workers may be provided 
either one or a combination of the following methods of training:
    (1) Insofar as possible, priority will be given to on-the-job 
training, which includes related education necessary to acquire skills 
needed for a position within a particular occupation, in the firm or 
elsewhere pursuant to Sec.Sec. 617.24, 617.25, and 617.26, including 
training for which the firm pays the costs. This ensures that on-the-job 
training provides the skills necessary for the individual to obtain 
employment in an occupation rather than a particular job at a specific 
site; and

[[Page 124]]

    (2) Institutional training, with priority given to providing the 
training in public area vocational education schools if it is determined 
that such schools are at least as effective and efficient as other 
institutional alternatives, pursuant to Sec.Sec. 617.24, 617.25, and 
617.26.
    (d) Standards and procedures. The State agency shall document the 
standards and procedures used to select occupations and training 
institutions in which training is approved. Such occupations and 
training shall offer a reasonable expectation (not necessarily a prior 
guarantee) of employment following such training.
    (1) Standards. The State agency shall approve training in 
occupations for which an identifiable demand exists either in the local 
labor market or in other labor markets for which relocation planning has 
been implemented. If practicable, placement rates and employer reviews 
of curriculum shall be used as guides in the selection of training 
institutions.
    (2) Procedures. In determining the types of training to be provided, 
the State agency shall consult with local employers, appropriate labor 
organizations, WIBs and other WIA One-Stop partners, WIBs, local 
educational organizations, local apprenticeship programs, local advisory 
councils established under the Carl D. Perkins Vocational Education Act, 
and post-secondary institutions.
    (3) Exclusions. In determining suitable training the State agency 
shall exclude certain occupations, where:
    (i) Lack of employment opportunities exist as substantiated by job 
orders and other pertinent labor market data; or
    (ii) The occupation provides no reasonable expectation of permanent 
employment.

[51 FR 45848, Dec. 22, 1986, as amended at 71 FR 35515, June 21, 2006]



Sec.  617.24  Preferred training.

    Training programs that may be approved underSec. 617.22(a) 
include, but are not limited to--
    (a) On-the-job training,
    (b) Any training program provided by a State pursuant to Title I, 
subchapter B of the Workforce Investment Act,
    (c) Any training program approved by a Workforce Investment Board 
established under the Workforce Investment Act,
    (d) Any program of remedial education,
    (e) Any training program (other than a training program described in 
paragraph (c) ofSec. 617.25) for which all, or any portion, of the 
costs of training the worker are paid--
    (1) Under any other Federal or State program other than this subpart 
C, or
    (2) From any other source other than this section, but not including 
sources personal to the individual, such as self, relatives, or friends, 
and
    (f) Any other training program approved by the Department.

[59 FR 936, Jan. 6, 1994, as amended at 71 FR 35515, June 21, 2006]



Sec.  617.25  Limitations on training under Subpart C of this part.

    The second sentence of amended section 236(a)(1) of the Act provides 
that an adversely affected worker shall be entitled to have payment of 
the costs of training approved under the Act paid on the worker's 
behalf, subject, however, ``to the limitations imposed by'' section 236. 
The limitations in section 236 which are implemented in this section 
concern the restrictions on approval of training which are related 
directly or indirectly to the conditions on training which are 
approvable or on the funding of training costs.
    (a) On-the-job training. The costs of on-the-job training approved 
subpart C of this part for a worker, which are paid from TAA funds, 
shall be paid in equal monthly installments. Such costs may be paid from 
TAA funds, and such training may be approved under subpart C of this 
part, however, only if the State agency determines that:
    (1) No currently employed individual is displaced by such eligible 
worker, including partial displacement such as a reduction in the hours 
of non-overtime work, wages, or employment benefits;
    (2) Such training does not impair existing contracts for services or 
collective bargaining agreements;
    (3) In the case of training which would be inconsistent with the 
terms of a collective bargaining agreement,

[[Page 125]]

written concurrence has been obtained from the concerned labor 
organization;
    (4) No other individual is on layoff from the same or any 
substantially equivalent job for which such eligible worker is being 
trained;
    (5) The employer has not terminated the employment of any regular 
employee or otherwise reduced the work force with the intention of 
filling the vacancy so created by hiring the eligible worker;
    (6) The job for which the eligible worker is being trained is not 
being created in a promotional line that will infringe in any way upon 
the promotional opportunities of currently employed individuals;
    (7) Such training is not for the same occupation from which the 
worker was separated and with respect to which such worker's group was 
certified pursuant to section 222 of the Act;
    (8) The employer certifies to the State agency that the employer 
will continue to employ the eligible worker for at least 26 weeks after 
completing the training if the worker desires to continue such 
employment and the employer does not have due cause to terminate such 
employment;
    (9) The employer has not received payment under this subpart C or 
under any other Federal law for any other on-the-job training provided 
by such employer which failed to meet the requirements of paragraphs 
(a)(1) through (a)(6) of this section or such other Federal law; and
    (10) The employer has not taken, at any time, any action which 
violated the terms of any certification described in paragraph (a)(8) of 
this section made by the employer with respect to any other on-the-job 
training provided by the employer for which the employer has received a 
payment under subpart C of this part (or the prior provisions of subpart 
C of this part).
    (b) Other authority and restrictions on funding--
    (1) In general. Section 236(a) contains several provisions which 
allow the costs of a training program approved under the Act to be 
paid--
    (i) Solely from TAA funds,
    (ii) Solely from other public or private funds, or
    (iii) Partly from TAA funds and partly from other public or private 
funds,

but also precludes the use of TAA funds or funds under another Federal 
law where such use of funds would result in duplication of payment of 
training costs. Those authorities and restrictions are spelled out in 
paragraph (b) of this section: Provided, that, private funds may not 
include funds from sources personal to the individual, such as self, 
relatives, or friends.
    (2) Section 236(a)(5)(E) of the Act. (i) In general. Paragraph 
(5)(E) of section 236(a) of the Act specifies one of the types of 
training programs approvable under the Act, as including a program 
(other than a training program described in section 236(a)(7) (paragraph 
(b)(5) of this section)) for which all, or any portion, of the costs of 
the training program are paid--
    (A) Under any Federal or State program other than the Act, or
    (B) From any source other than TAA funds.
    (ii) Application. Paragraph (E) of section 236(a)(5) of the Act thus 
authorizes prearrangements between cooperating State agencies 
administering the TAA program and the authorities administering any 
other Federal, State, or private funding source, to agree upon any mix 
of TAA funds and other funds for paying the costs of a training program 
approved under subpart C of this part. Any such prearrangement must 
contain specific commitments from the other authorities to pay the costs 
they agree to assume.
    (3) Section 236(a)(6) of the Act. (i) In general. Paragraph (6) of 
section 236(a) of the Act is related to section 236(a)(5)(E) in 
providing that the costs of a training program approved under the Act 
are not required to be paid from TAA funds to the extent that such costs 
are paid under any Federal or State program other than the Act or from 
any source other than the Act.
    (ii) Application. (A) Although paragraph (6) of section 236(a) of 
the Act is expressed in terms of the costs not being required to be paid 
from TAA funds, it authorizes the mixing of TAA funds and funds from any 
other Federal, State or private source. Therefore, sharing the future 
costs of training is authorized where prior costs

[[Page 126]]

were paid from another Federal, State or private source, but this does 
not authorize reimbursement from TAA funds of any training costs which 
were incurred and for which payment became due prior to the approval of 
the training program under subpart C of this part. In utilizing the 
authority under paragraph (b)(3) of this section for sharing training 
costs, prearrangements shall be entered into as required under paragraph 
(b)(2) of this section before any TAA funds are obligated.
    (B) Paragraph (6) of section 236(a) contains a special restriction 
on the authority derived thereunder to use TAA funds in sharing training 
costs. Therefore, before approving any training program under subpart C 
of this part, which may involve sharing of the training costs under the 
authority of paragraph (b)(3) of this section, the cooperating State 
agencies for the TAA program shall require the worker to enter into a 
written agreement with the State under which TAA funds will not be 
applied for or used to pay any portion of the costs of the training the 
worker has reason to believe will be paid by any other governmental or 
private source.
    (4) Section 236(a)(4) of the Act. (i) In general. (A) Paragraph (4) 
of section 236(a) of the Act (paragraph (3) of section 236(a) before 
August 23, 1988) continues to provide, as it did before the addition of 
paragraphs (5)(E), (6), and (7) to section 236(a), that:
    (1) When the costs of training are paid from TAA funds under subpart 
C of this part, no other payment for such costs of training may be made 
under any other Federal law; and
    (2) When the payment of the costs of training has already been made 
under any other Federal law, or the costs are reimbursable under any 
other Federal law and a portion of the costs has already been paid under 
such other Federal law, payment of such training costs may not be made 
from TAA funds.
    (B) Paragraph (4) of section 236(a) also requires that: The 
provisions of paragraphs (b)(4)(i) (A)(1) and (A)(2) of this section 
shall not apply to, or take into account, any funds provided under any 
other provision of Federal law which are used for any purpose other than 
the direct payment of the identical costs incurred in training the 
adversely affected worker under the TAA Program, even if such other use 
has the effect of indirectly paying or reducing any portion of the costs 
involved in training the adversely affected worker.
    (ii) Application. (A) Although the prohibition on duplicate payments 
in the first part of section 236(a)(4) remains fully implemented in this 
section, the second part of section 236(a)(4) on the sharing of costs 
from TAA funds and other Federal fund sources is modified by the 
explicit provisions of paragraphs (5)(E) and (6) of section 236(a), as 
set forth in paragraphs (b)(2) and (b)(3) of this section.
    (B) When the direct costs of a training program approvable under 
subpart C of this part are payable from TAA funds and are also wholly or 
partially payable under another Federal law, or under any State law or 
from private, nongovernmental sources, the TAA Program agencies shall 
establish procedures which ensure that TAA funds shall not be utilized 
to duplicate funds available from another source, but this preclusion of 
duplication does not prohibit and shall not discourage sharing of costs 
under prearrangements authorized under paragraphs (b)(2) and (b)(3) of 
this section.
    (C)(1) Therefore, pursuant to paragraph (4) of section 236(a), 
paragraph (b)(4) of this section continues to prohibit duplicate payment 
of training costs, which is consistent with the general prohibition 
expressed in subpart C of this part, against any use of TAA funds to 
duplicate payment of training costs in any circumstances. Paragraph 
(b)(4) of this section also continues to prohibit taking into account, 
in determining whether training costs are payable from TAA funds, any 
payments to the worker under any other Federal law which may have the 
effect of indirectly paying all or a portion of the training costs. Such 
indirect payments include Veterans Educational Assistance, Pell Grants, 
and Supplemental Educational Opportunity Grants, which are paid to the 
individual. However, any payments to the individual under these programs 
are deductible from TRA payable to the individual underSec. 
617.13(c)(2).

[[Page 127]]

    (2) When payments of Veterans Educational Assistance, Pell Grants, 
and Supplemental Educational Opportunity Grants are made to the training 
provider, instead of the individual, and are used for training costs, 
such payments shall be taken into account as direct payment of the 
training costs under other Federal law for the purposes of this section.
    (5) Section 236(a)(7) of the Act. (i) In general. Paragraph (7) of 
section 236(a) of the Act provides that a training program shall not be 
approved under the Act if--
    (A) all or a portion of the costs of such training program are paid 
under any nongovernmental plan or program,
    (B) the adversely affected worker has a right to obtain training or 
funds for training under such plan or program, and
    (C) such plan or program requires the worker to reimburse the plan 
or program from funds provided under the Act, or from wages paid under 
such training program, for any portion of the costs of such training 
program paid under the plan or program.
    (ii) Application. Paragraph (7) of section 236(a), which is 
implemented in paragraph (b)(5) of this section, reinforces the 
prohibition inSec. 617.22(h) against approval of a training program 
under subpart C of this part if the worker is required to pay a fee or 
tuition. The provisions of paragraph (b) and paragraph (h) of this 
section shall be given effect as prohibiting the approval under subpart 
C of this part of any training program if the worker would be requested 
or required, at any time or under any circumstances, to pay any of the 
costs of a training program, however small, from any TAA funds given to 
the worker or from any other funds belonging to the worker from any 
source whatever. Aside from this stringent limitation, however, 
paragraph (7) of section 236(a) of the Act implicitly authorizes 
training approved under this subpart C to be wholly or partly funded 
from nongovernmental (i.e., employer, union or other private) sources.

[59 FR 936, Jan. 6, 1994]



Sec.  617.26  Liable and agent State responsibilities.

    (a) Liable State. The liable State means, for any individual, the 
State which administers the applicable State law (as determined under 
Sec.  617.16). The liable State is responsible for making all 
determinations, redeterminations, and decisions on appeals on all claims 
for program benefits under this part 617, including waivers and 
revocations of waivers pursuant toSec. 617.19, subsistence payments 
pursuant toSec. 617.27, and transportation payments pursuant toSec. 
617.28. Upon receiving a copy of a certification issued by the 
Department, with respect to an affected firm in the State, the liable 
State also is responsible for publishing newspaper notices as provided 
inSec. 617.4(d), furnishing information and assistance to workers as 
provided inSec. 617.4, furnishing reemployment services under subparts 
C, D, and E of this part to all eligible workers covered by such 
certification, and carrying out other activities and functions required 
by the State's Agreement with the Secretary entered into pursuant to 
Sec.  617.59. All determinations pertaining to any individual's 
eligibility for or entitlement to any program benefit under this part 
617 shall be subject to the provisions of Sec.Sec. 617.50 and 617.51.
    (b) Agent State. Agent State means, for any individual, any State 
other than the liable State for the individual. Agent States shall be 
responsible for cooperating fully with the liable State and assisting 
the liable State in carrying out its activities and functions. These 
agent State responsibilities shall be part of the activities and 
functions undertaken by the agent States under their Agreements entered 
into pursuant toSec. 617.59. Agent State responsibilities include 
cooperating with liable States in taking applications and claims for 
TAA, providing reemployment services to certified workers in accordance 
with subparts B, C, D and E of this part, providing interstate claimants 
with TAA program information and assistance, assisting applicants or 
claimants to file claims for TAA program benefits and services, 
cooperating with the liable State by providing information needed to 
issue determinations, redeterminations, and decisions

[[Page 128]]

on appeals, and procuring and paying the cost of any approved training, 
including subsistence and transportation costs, according to 
determinations issued by the liable State.

[59 FR 938, Jan. 6, 1994]



Sec.  617.27  Subsistence payments.

    (a) Eligibility. A trainee under this subpart C shall be afforded 
supplemental assistance necessary to pay costs of separate maintenance 
when the training facility is located outside the commuting area, but 
may not receive such supplemental assistance for any period for which 
the trainee receives such a payment under the Workforce Investment Act, 
or any other law, or for any day referred to underSec. 617.28(c)(3) 
pursuant to which a transportation allowance is payable to the 
individual, or to the extent the individual is entitled to be paid or 
reimbursed for such expenses from any other source.
    (b) Amount. Subsistence payments shall not exceed the lesser of:
    (1) The individual's actual per diem expenses for subsistence; or
    (2) 50 percent of the prevailing per diem rate authorized under the 
Federal travel regulations (see 41 CFR part 101-7) for the locale of the 
training.
    (c) Applications. Applications for subsistence payments shall be 
filed in accordance with this subpart C and on forms which shall be 
furnished to trainees by the State agency. Such payments shall be made 
on completion of a week of training, except that at the beginning of a 
training project a State agency may advance a payment for a week if it 
determines that such advance is necessary to enable a trainee to accept 
training. An adjustment shall be made if the amount of an advance is 
less or more than the amount to which the trainee is entitled under 
paragraph (b) of this section. A determination as to an application made 
under this section shall be subject to Sec.Sec. 617.50 and 617.51.
    (d) Unexcused absences. No subsistence payment shall be made to an 
individual for any day of unexcused absence as certified by the 
responsible training facility.

[51 FR 45848, Dec. 22, 1986, as amended at 71 FR 35516, June 21, 2006]



Sec.  617.28  Transportation payments.

    (a) Eligibility. A trainee under this subpart C shall be afforded 
supplemental assistance necessary to pay transportation expenses if the 
training is outside the commuting area, but may not receive such 
assistance if transportation is arranged for the trainee as part of a 
group and paid for by the State agency or to the extent the trainee 
receives a payment of transportation expenses under another Federal law, 
or to the extent the individual is entitled to be paid or reimbursed for 
such expenses from any other source.
    (b) Amount. A transportation allowance shall not exceed the lesser 
of:
    (1) The actual cost for travel by the least expensive means of 
transportation reasonably available between the trainee's home and the 
training facility; or
    (2) The cost per mile at the prevailing mileage rate authorized 
under the Federal travel regulations. See 41 CFR part 101-7.
    (c) Travel included. Travel for which a transportation allowance 
shall be paid includes travel:
    (1) At the beginning and end of the training program;
    (2) When the trainee fails for good cause, as described inSec. 
617.18(b)(2), to complete the training program; and
    (3) For daily commuting, in lieu of subsistence, but not exceeding 
the amount otherwise payable as subsistence for each day of commuting.
    (d) Applications. Applications for transportation payments shall be 
filed in accordance with this subpart C and on forms which shall be 
furnished to trainees by the State agency. Payments may be made in 
advance. An adjustment shall be made if the amount of an advance is less 
or more than the amount to which the trainee is entitled under paragraph 
(b) of this section. A determination as to an application made under 
this section shall be subject to Sec.Sec. 617.50 and 617.51.

[[Page 129]]



Sec.  617.29  Application of EB work test.

    (a) Registration for employment. Adversely affected workers who have 
exhausted all rights to UI and who otherwise qualify for TRA underSec. 
617.11, shall, except as provided in paragraph (b) of this section:
    (1) Register for work and be referred to work by the State agency in 
the same manner as required for EB claimants under the applicable State 
law provisions which are consistent with section 202(a)(3) of the 
Federal-State Extended Unemployment Compensation Act of 1970; and
    (2) Be subject to the work test requirements for EB claimants under 
the applicable State law provisions which are consistent with section 
202(a)(3) of the Federal-State Extended Unemployment Compensation Act of 
1970.
    (b) Exceptions. Paragraph (a) of this section shall not apply to any 
week an individual is undergoing training approved under this subpart C.



                     Subpart D_Job Search Allowances



Sec.  617.30  General.

    A job search allowance shall be granted an adversely affected worker 
to assist the individual in securing a job within the United States as 
provided in this subpart D.



Sec.  617.31  Applications.

    (a) Forms. Applications for job search allowances shall be filed in 
accordance with this subpart D and on forms which shall be furnished to 
individuals by the State agency.
    (b) Submittal. An application may be submitted to a State agency at 
any time by an individual who has been totally or partially separated 
whether or not a certification covering the individual has been made. 
However, an application must be submitted to a State agency before the 
job search begins for the job search allowance to be granted, and the 
job search may not be approved until after the individual is covered 
under a certification.
    (c) Time limits. Notwithstanding paragraph (b) of this section, a 
job search allowance application may be approved only if submitted 
before:
    (1) The 365th day after the date of the certification under which 
the individual is covered, or the 365th day after the date of the 
individual's last total separation, whichever is later; or
    (2) The 182d day after the concluding date of training approved 
under subpart C of this part 617, or approved under the regulations 
superseded by this part 617.



Sec.  617.32  Eligibility.

    (a) Conditions. Job search allowance eligibility requires:
    (1) A timely filed application;
    (2) Total separation from adversely affected employment at the time 
the job search commences;
    (3) Registration with the State agency which shall furnish the 
individual such reemployment services as are appropriate under subpart C 
of this part 617.
    (4) A determination by the State agency that the individual has no 
reasonable expectation of securing suitable employment in the commuting 
area, and has a reasonable expectation of obtaining suitable employment 
of long-term duration outside the commuting area and in the area where 
the job search will be conducted. For the purposes of this section, the 
term ``suitable employment'' means suitable work as defined inSec. 
617.3(kk) (1) or (2), whichever is applicable to the individual; and
    (5) Completion of the job search within a reasonable period not 
exceeding 30 days after the day on which the job search began.
    (b) Completion of job search. A job search is deemed completed when 
the individual either secures employment or has contacted each employer 
to whom referred by the State agency in connection with a job search.
    (c) Verification of employer contacts. The State agency shall verify 
contacts with employers certified by the individual.

[51 FR 45848, Dec. 22, 1986, as amended at 59 FR 938, Jan. 6, 1994]



Sec.  617.33  Findings required.

    (a) Findings by liable State. Before final payment of a job search 
allowance may be approved, the following

[[Page 130]]

findings shall be made by the liable State:
    (1) The individual meets the eligibility requirements for a job 
search allowance specified inSec. 617.32(a) (1) through (4);
    (2) The application for a job search allowance was submitted by the 
individual within the time limits specified inSec. 617.31(c); and
    (3) The individual completed the job search within the time limits 
stated inSec. 617.32(a)(5), and the requirements of paragraphs (b) and 
(c) ofSec. 617.32 have been met.
    (b) Agent State. (1) When an individual files an application for a 
job search allowance with respect to a job search conducted in a State 
other than the liable State, the State agency of the State in which the 
individual conducts the job search shall serve as the agent State and be 
responsible for assisting the individual in conducting the job search 
and in filing an application for a job search allowance with the liable 
State, and for assisting the liable State by furnishing to it any 
information required for the liable State's determination of the claim.
    (2) The agent State shall cooperate fully with the liable State in 
carrying out its activities and functions with regard to such 
applications.

[59 FR 938, Jan. 6, 1994]



Sec.  617.34  Amount.

    (a) Computation. The amount of a job search allowance shall be 90 
percent of the total costs of each of the following allowable 
transportation and subsistence items:
    (1) Travel. The more cost effective mode of travel reasonably 
available shall be approved by using:
    (i) The actual cost of round trip travel by the most economical 
public transportation the individual reasonably can be expected to take 
from the individual's residence to the area of job search; or
    (ii) The cost per mile at the prevailing mileage rate authorized 
under the Federal travel regulations (see 41 CFR part 101-7) for such 
roundtrip travel by the usual route from the individual's residence to 
the area of job search.
    (2) Lodging and meals. The cost allowable for lodging and meals 
shall not exceed the lesser of:
    (i) The actual cost to the individual of lodging and meals while 
engaged in the job search; or
    (ii) 50 percent of the prevailing per diem allowance rate authorized 
under the Federal travel regulations (see 41 CFR part 101-7) for the 
locality where the job search is conducted.
    (b) Limit. The total job search allowances paid to an individual 
under a certification may not exceed $800, regardless of the number of 
job searches undertaken by the individual. The amounts otherwise payable 
under paragraph (a) of this section shall be reduced by any amounts the 
individual is entitled to be paid or reimbursed for such expenses from 
any other source.

[51 FR 45848, Dec. 22, 1986, as amended at 51 FR 45869, Dec. 22, 1986; 
53 FR 32351, Aug. 24, 1988; 59 FR 939, Jan. 6, 1994]



Sec.  617.35  Time and method of payment.

    (a) Determinations. A State agency shall promptly make and record 
determinations necessary to assure entitlement of an individual to a job 
search allowance at any time, before or after a certification covering 
the individual is made. No job search allowance may be paid or advanced 
to an individual until the State agency determines that the individual 
is covered under a certification. A State agency shall make payment as 
promptly as possible upon determining that the individual is covered 
under a certification and is otherwise eligible.
    (b) Payment. Unless paragraph (a) of this section applies, a job 
search allowance shall be paid promptly after an individual completes a 
job search and complies with paragraph (d) of this section.
    (c) Advances. A State agency may advance an individual (except an 
individual not yet covered under a certification) 60 percent of the 
estimated amount of the job search allowance payable on completion of 
the job search, but not exceeding $360, within 5 days prior to 
commencement of a job search. Such advance shall be deducted from any 
payment under paragraph (b) of this section.

[[Page 131]]

    (d) Worker evidence. On completion of a job search, the individual 
shall certify on forms furnished by the State agency as to employer 
contacts made and amounts expended daily for lodging and meals. Receipts 
shall be required for all lodging and purchased transportation expenses 
incurred by the individual pursuant to the job search. An adjustment 
shall be made if the amount of an advance is less or more than the 
amount to which the individual is entitled underSec. 617.34.



                     Subpart E_Relocation Allowances



Sec.  617.40  General.

    A relocation allowance shall be granted an adversely affected worker 
to assist the individual and the individual's family, if any, to 
relocate within the United States as stated in this subpart E. A 
relocation allowance may be granted an individual only once under a 
certification. A relocation allowance shall not be granted to more than 
one member of a family with respect to the same relocation. If 
applications for a relocation allowance are made by more than one member 
of a family as to the same relocation, the allowance shall be paid to 
the head of the family if otherwise eligible.



Sec.  617.41  Applications.

    (a) Forms. Applications for a relocation allowance shall be filed in 
accordance with this subpart E and on forms which shall be furnished by 
the State agency.
    (b) Submittal. An application may be submitted to the State agency 
at any time by an individual who has been totally or partially separated 
regardless of whether a certification covering the individual has been 
made. However, an application must be submitted to a State agency before 
the relocation begins for the relocation allowance to be granted, and 
the relocation may not be approved until after the individual is covered 
under a certification.
    (c) Time limits. Notwithstanding paragraph (b) of this section, an 
application for a relocation allowance may not be approved unless 
submitted before:
    (1) The 425th day after the date of the certification under which 
the individual is covered, or the 425th day after the date of the 
individual's last total separation, whichever is later; or
    (2) The 182d day after the concluding date of training approved 
under subpart C of this part 617, or approved under the regulations 
superseded by this part 617.



Sec.  617.42  Eligibility.

    (a) Conditions. Eligibility for a relocation allowance requires:
    (1) A timely filed application;
    (2) Total separation from adversely affected employment at the time 
relocation commences;
    (3) No prior receipt of a relocation allowance under the same 
certification;
    (4) Relocation within the United States and outside the individual's 
present commuting area;
    (5) Registration with the State agency which shall furnish the 
individual such reemployment services as are appropriate under subpart C 
of this part 617;
    (6) A determination by the State agency that the individual has no 
reasonable expectation of securing suitable employment in the commuting 
area, and has obtained suitable employment affording a reasonable 
expectation of employment of long-term duration, or a bona fide offer of 
such suitable employment, outside the commuting area and in the area of 
intended relocation. For the purposes of this section, the term 
``suitable employment'' means suitable work as defined inSec. 
617.3(kk) (1) and (2), whichever is applicable to the individual; and
    (7) Relocation beginning within a reasonable period, as determined 
underSec. 617.43(b), and completion of such relocation within a 
reasonable period of time as determined in accordance with Federal 
travel regulations andSec. 617.43(a).
    (b) Job search. Applications for a relocation allowance and a job 
search allowance may not be approved concurrently, but the prior payment 
of a job search allowance shall not otherwise preclude the payment of a 
relocation allowance.

[51 FR 45848, Dec. 22, 1986, as amended at 59 FR 939, Jan. 6, 1994]

[[Page 132]]



Sec.  617.43  Time of relocation.

    (a) Applicable considerations. In determining whether an 
individual's relocation is completed in a reasonable period of time, a 
State agency, among other factors, shall consider whether:
    (1) Suitable housing is available in the area of relocation;
    (2) The individual can dispose of the individual's residence;
    (3) The individual or a family member is ill; and
    (4) A member of the individual's family is attending school and when 
the member can best be transferred to a school in the area of 
relocation.
    (b) Time limits. The reasonable period for actually beginning a 
relocation move shall expire 182 days after the date of application for 
a relocation allowance, or 182 days after the conclusion of training 
approved under subpart C of this part 617, or approved under the 
regulations in former 29 CFR part 91, in effect prior to its 
redesignation as this 20 CFR part 617 and its concurrent revision.



Sec.  617.44  Findings required.

    (a) Findings by liable State. Before final payment of a relocation 
allowance may be approved, the following findings shall be made by the 
liable State:
    (1) The individual meets the eligibility requirements for a 
relocation allowance specified inSec. 617.42(a) (1) to (6) andSec. 
617.42(b).
    (2) The application for a relocation allowance was submitted by the 
individual within the time limits specified inSec. 617.41(c);
    (3) The individual began and completed the relocation within the 
limitations specified inSec. 617.42(a)(7) andSec. 617.43; and
    (4) The liable State has verified (directly or through the agent 
State) with the employer, and finds, that the individual has obtained 
suitable employment affording a reasonable expectation of employment of 
long-term duration, or a bona fide offer of such suitable employment, in 
the area of intended relocation, in accordance withSec. 617.42(a)(6).
    (b) Agent State. (1) When an individual relocates in a State other 
than the liable State, the State agency of the State in which the 
individual relocates shall serve as the agent State and be responsible 
for:
    (i) Assisting the individual in relocating to the State, and in 
filing an application for a relocation allowance with the liable State, 
and
    (ii) Assisting the liable State by furnishing to it any information 
required for the liable State's determination on the claim.
    (2) The agent State shall cooperate with the liable State in 
carrying out its activities and functions with regard to such 
applications. When requested by the liable State, the agent State shall 
verify with the employer and report to the liable State whether the 
individual has obtained suitable employment affording a reasonable 
expectation of employment of long-term duration, or a bona fide offer of 
such suitable employment.

[59 FR 939, Jan. 6, 1994]



Sec.  617.45  Amount.

    (a) Items allowable. The amount payable as a relocation allowance 
shall include the following items:
    (1) 90 percent of the travel expenses for the individual and family, 
if any, from the individual's place of residence to the area of 
relocation, as determined underSec. 617.46;
    (2) 90 percent of the expenses of moving household goods and 
personal effects of the individual and family, if any, not to exceed the 
maximum number of pounds net weight authorized under the Federal travel 
regulations (see 41 CFR part 101-7), between such locations, as 
determined underSec. 617.47; and
    (3) A lump sum payment, equal to 3 times the individual's average 
weekly wage, not to exceed $800.
    (b) Reduction. The amount otherwise payable under paragraphs (a)(1) 
and (a)(2) of this section shall be reduced by any amount the individual 
is entitled to be paid or reimbursed for such expenses from any other 
source.

[51 FR 45848, Dec. 22, 1986, as amended at 51 FR 45869, Dec. 22, 1986]



Sec.  617.46  Travel allowance.

    (a) Computation. The amount of travel allowance (including lodging 
and

[[Page 133]]

meals) payable underSec. 617.45(a)(1) shall be 90 percent of the total 
costs of each of the following allowable transportation and subsistence 
items:
    (1) Transportation. The more cost effective mode of transportation 
reasonably available shall be approved by using:
    (i) The actual cost of transportation for the individual and family, 
if any, by the most economical public transportation the individual and 
family reasonably can be expected to take from the individual's old 
residence to the individual's new residence in the area of relocation; 
or
    (ii) The cost per mile at the prevailing mileage rate authorized 
under the Federal travel regulations (see 41 CFR part 101-7) for the 
usually traveled route from the individual's old residence to the 
individual's new residence in the area of relocation. No additional 
mileage shall be payable for family members traveling on the same trip 
in the same vehicle.
    (2) Lodging and meals. The cost allowable for lodging and meals for 
an individual or each member of the individual's family shall not exceed 
the lesser of:
    (i) The actual cost to the individual for lodging and meals while in 
travel status; or
    (ii) 50 percent of the prevailing per diem allowance rate authorized 
under the Federal travel regulations (see 41 CFR part 101-7) for the 
locality to which the relocation is made.
    (b) Separate travel. If, for good cause, a member or members of an 
individual's family must travel separately to the individual's new 
residence, 90 percent of the total costs of such separate travel, 
computed in accordance with paragraph (a) of this section, shall be 
included in calculating the total amount the individual is entitled to 
be paid under this subpart E. For purposes of this paragraph (b), good 
cause means such reasons as would justify the family member's inability 
to relocate with the other members of the individual's family, including 
but not limited to reasons related to the family member's health, 
schooling or economic circumstances.
    (c) Limitation. In no case may the individual be paid a travel 
allowance for the individual or a member of the individual's family more 
than once in connection with a single relocation.

[51 FR 45848, Dec. 22, 1986, as amended at 53 FR 32351, Aug. 24, 1988]



Sec.  617.47  Moving allowance.

    (a) Computation. The amount of a moving allowance payable under 
Sec.  617.45(a)(2) shall be 90 percent of the total of the allowable 
costs under either (1), (2), or (3) of this paragraph, and 90 percent of 
the total allowable costs under (4) of this paragraph:
    (1) Commercial carrier. Allowable costs for moving household goods 
and personal effects of an individual and family, if any, shall not 
exceed the maximum number of pounds net weight authorized under the 
Federal travel regulations (see 41 CFR part 101-7) by commercial carrier 
from the individual's old residence to the individual's new residence in 
the area of relocation, including reasonable and necessary accessorial 
charges, by the most economical commercial carrier the individual 
reasonably can be expected to use. Before undertaking such move, the 
individual must submit to the State agency an estimate from a commercial 
carrier as to the cost thereof. Accessorial charges shall include the 
cost of insuring such goods and effects for their actual value or 
$10,000, whichever is least, against loss or damage in transit, if a bid 
from a licensed insurer is obtained by the individual and approved by 
the State agency before departure. If a State agency finds it is more 
economical to pay a carrier an extra charge to assume the responsibility 
of a common carrier for such goods and effects, 90 percent of such extra 
charge, but not exceeding $50, shall be paid in lieu of the cost of 
insurance.
    (2) Trailer or rental truck--(i) Trailer. If household goods and 
personal effects are moved by trailer, the allowable costs shall be:
    (A) If the trailer is hauled by private vehicle, the cost per mile 
for the use of the private vehicle at the prevailing mileage rate 
authorized under the Federal travel regulations (see 41 CFR part 101-7) 
for the usually traveled route from the individual's old residence to

[[Page 134]]

the individual's new residence in the area of relocation; and
    (B) lf the trailer is rented, and of the type customarily used for 
moving household goods and personal effects, the rental fee for each day 
reasonably required to complete the move; or
    (C) The actual charge if hauling is by commercial carrier,
    (ii) Rental truck. If household goods and personal effects are moved 
by rental truck of the type customarily used for moving household goods 
and personal effects, the allowable costs shall be:
    (A) The rental fee for each day reasonably required to complete the 
move; and
    (B) The necessary fuel for such rental truck paid by the individual.
    (3) House trailer. If a house trailer or mobile home was used as the 
individual's place of residence in the old area and will be so used in 
the new area, the allowable costs of moving such house trailer or mobile 
home shall be:
    (i) The commercial carrier's charges for moving the house trailer or 
mobile home;
    (ii) Charges for unblocking and reblocking;
    (iii) Ferry charges, bridge, road, and tunnel tolls, taxes, fees 
fixed by a State or local authority for permits to transport the unit in 
or through its jurisdiction, and retention of necessary flagmen; and
    (iv) The cost of insuring the house trailer or mobile home, and the 
personal effects of the individual and family, against loss or damage in 
transit, in accordance with the provisions in paragraph (a)(1) of this 
section.
    (4) Temporary storage. If temporary storage of household goods and 
personal effects is necessary, the cost of such temporary storage for a 
period not to exceed 60 days.
    (b) Travel. Payments under this section shall be in addition to 
payments for travel expenses for the individual and family, if any, 
underSec. 617.45(a)(1), except that the allowable cost for a private 
vehicle used to haul a trailer may not be paid under this section if any 
cost with respect to such private vehicle is payable under any other 
provisions of this subpart E.



Sec.  617.48  Time and method of payment.

    (a) Determinations. A State agency shall promptly make and record 
determinations necessary to assure an individual's entitlement to a 
relocation allowance at any time, before or after a certification 
covering the individual is made. No relocation allowance may be paid or 
advanced to an individual until the State agency determines that the 
individual is covered under a certification. A State agency shall make 
payment as promptly as possible upon determining that the individual is 
covered under a certification and is otherwise eligible.
    (b) Travel and moving allowances. Allowances computed under 
Sec.Sec. 617.46 and 617.47 shall be paid as follows:
    (1) Travel--(i) Transportation and subsistence. The amounts 
estimated underSec. 617.46 at 90 percent of the lowest allowable costs 
shall be paid in advance at the time an individual departs from the 
individual's residence to begin relocation or within 10 days prior 
thereto. An amount payable for a family member approved for separate 
travel shall be paid to the individual at the time of such family 
member's departure or within 10 days prior thereto.
    (ii) Worker evidence. On completion of a relocation, the individual 
shall certify on forms furnished by the State agency as to the amount 
expended daily for lodging and meals. Receipts shall be required for all 
lodging and purchased transportation expenses incurred by the individual 
and family, if any, pursuant to the relocation. An adjustment shall be 
made if the amount of an advance is less or more than the amount to 
which the individual is entitled underSec. 617.46.
    (2) Moving. The amount estimated underSec. 617.47 at 90 percent of 
the lowest allowable costs shall be paid:
    (i) Commercial carrier. (A) If household goods and personal effects 
are moved by commercial carrier, 90 percent of the amount of the 
estimate submitted by the individual underSec. 617.47(a)(1) and 
approved by the State agency for covering the cost of such move, and 90 
percent of the other charges approved by the State agency underSec. 
617.47(a)(1) shall be advanced by check or checks payable to the carrier 
and insurer, and delivered to the individual at the time

[[Page 135]]

of the scheduled shipment or within 10 days prior thereto. On completion 
of the move, the individual shall promptly submit to the State agency a 
copy of the bill of lading prepared by the carrier, including a receipt 
evidencing payment of moving costs. The individual shall with such 
submittal reimburse the State agency the amount, if any, by which the 
advance made under this paragraph (b)(2)(i) exceeds 90 percent of the 
actual moving costs approved by the State agency. The individual shall 
be paid the difference if the amount advanced was less than 90 percent 
of the actual moving costs approved by the State agency.
    (B) If more economical, a State agency may make direct arrangements 
for moving and insuring an individual's household goods and personal 
effects with a carrier and insurer selected by the individual and may 
make payment of 90 percent of moving and insurance costs directly to the 
carrier and insurer. No such arrangement shall release a carrier from 
liability otherwise provided by law or contract for loss or damage to 
the individual's goods and effects. The United States shall not be or 
become liable to either party for personal injury or property loss 
damage under any circumstances.
    (ii) Trailer or rental truck--(A) Private vehicle with trailer. If 
the move is by private vehicle and trailer, the allowable cost for the 
use of the private vehicle shall be made at the time payment is made 
under paragraph (b)(1) of this section.
    (B) Rental trailer or rental truck. If the move is by rental trailer 
or rental truck:
    (1) The individual shall submit an estimate of the rental cost from 
the rental agency; and
    (2) 90 percent of such estimated rental cost may be advanced by 
check payable to the order of the individual and the rental agency at 
the time payment is made under paragraph (b)(1) of this section; and
    (3) On completion of the move the individual shall submit promptly 
to the State agency a receipted bill itemizing and evidencing payment of 
the rental charges for the trailer or truck and fuel costs, and shall 
reimburse the State agency for the amount, if any, by which the advance 
made for the trailer or truck exceeds 90 percent of the rental charges 
approved by the State agency. If the amount of the advance was less than 
90 percent of the rental charges, the individual shall be paid the 
difference.
    (iii) House trailer. If a house trailer or mobile home is moved by 
commercial carrier, the individual shall submit to the State agency an 
estimate of the cost of the move by the commercial carrier. A check for 
90 percent of the amount of the estimate, if approved, payable to the 
individual and the carrier, may be delivered to the individual at the 
time of the scheduled move or within 10 days prior thereto.
    (c) Lump sum allowance. The lump sum allowance provided inSec. 
617.45(a)(3) shall be paid when arrangements are completed for 
relocation of the individual and family, if any, but not more than 10 
days before the earlier of the individual's anticipated departure from 
the individual's residence to begin relocation or the anticipated date 
of shipment of the individual's household goods and personal effects.
    (d) Relocation completed. A relocation is completed when an 
individual and family, if any, and their household goods and personal 
effects arrive at the individual's residence in the area of relocation. 
If no household goods and personal effects are moved, a relocation is 
completed when the individual and family, if any, arrive in the area of 
relocation and establish a residence in the new area. The later arrival 
of a family member approved for separate travel shall not alter the date 
a relocation was completed.



                      Subpart F_Job Search Program



Sec.  617.49  Job Search Program.

    (a) Program requirements. (1) A worker, after being separated from 
adversely affected employment, must participate in an approved job 
search program (JSP), or have completed a JSP, as a condition for 
receiving TRA, except where the State agency determines that an 
acceptable JSP is not reasonably available.
    (2) A TRA claimant is subject to participation in a JSP as a 
condition for

[[Page 136]]

receiving TRA for weeks of unemployment which begin after the date the 
claimant is notified of the requirement and has filed an initial claim 
for TRA. The claimant is not subject to the JSP as a condition for 
receiving TRA for weeks which begin prior to that date.
    (3) When the State agency determines that the worker has failed to 
begin participation in an approved JSP, or ceased to participate in such 
a JSP before completion, and there is no justifiable cause for such 
failure or cessation, no TRA may be paid to the worker for weeks 
beginning with the week that failure or cessation occurred when it is 
determined that such failure or cessation was without justifiable cause. 
TRA may be paid thereafter to an otherwise eligible worker only for 
weeks beginning with the week the worker begins or resumes participation 
in an approved JSP or complete the JSP. For purposes of this paragraph 
(a)(3), justifiable cause means such reasons as would justify an 
individual's conduct when measured by conduct expected of a reasonable 
individual in like circumstances, including but not limited to reasons 
beyond the individual's control and reasons related to the individual's 
capability to enroll in an approved JSP or complete the JSP.
    (4) A worker in training approved under Sec.Sec. 617.22 through 
617.26, or approved by the State agency under State law, is excepted 
from the JSP qualifying requirement while the worker is attending and 
making satisfactory progress in the training. This exception applies 
whether training begins before or after entitlement to basic TRA 
commences, and also applies after training begins for a worker who is 
attending a JSP program. Exceptions to the JSP qualifying requirement 
must be documented in the worker's claim file by the State agency.
    (b) Approved JSPs. A job search program may be approved if:
    (1) The JSP is provided through the Workforce Investment Act, the 
public employment service, or any other Federal or State funded program, 
and complies with paragraphs (w), (x), and (y) ofSec. 617.3.
    (2) The JSP is sponsored by a company or firm from which the worker 
has been separated, and complies with paragraphs (w), (x), and (y) of 
Sec.  617.3.
    (c) Determination of reasonably available. (1) Reasonably available 
means an existing approved JSP that is located in the worker's normal 
commuting area, as defined inSec. 617.3, and has sufficient capacity 
to accommodate the worker.
    (2) When the State determines that a JSP is not reasonably available 
for a worker, the requirement is not a condition of qualifying for TRA 
for the weeks involved. When a determination is made with respect to a 
worker, the State agency must document its determination, and the weeks 
involved, in the worker's claim file, prior to making TRA payments to 
the worker.
    (3) The State agency may issue a blanket waiver of the JSP 
qualifying requirement for TRA for groups of workers, where deemed 
appropriate, when it is determined that there is no functioning JSP.
    (4) All determinations that a JSP is not reasonably available should 
extend only for that period of time that a JSP is not reasonably 
available, and the exception for workers in approved training should 
extend until the completion of training. If the State determines that a 
JSP is reasonably available at a later date, then the JSP qualifying 
requirement must be met for entitlement to basic TRA for weeks of 
unemployment beginning with the week in which JSP becomes reasonably 
available.
    (d) JSP allowances. Subsistence and transportation costs shall be 
approved for workers participating in JSPs when deemed appropriate and 
within available State funding levels. Costs incurred may not exceed 
those allowable for training under Sec.Sec. 617.27 and 617.28, if, and 
when, the State refers a worker to a JSP outside the normal commuting 
area.
    (e) Termination of requirement. The job search program requirement 
set out in this section shall not be a condition of entitlement to TRA 
for any week.

[53 FR 32351, Aug. 24, 1988, as amended at 54 FR 22277, May 23, 1989; 59 
FR 939, Jan. 6, 1994; 71 FR 35516, June 21, 2006]

[[Page 137]]



          Subpart G_Administration by Applicable State Agencies



Sec.  617.50  Determinations of entitlement; notices to individuals.

    (a) Determinations of initial applications for TRA or other TAA. The 
State Agency whose State law is the applicable State law underSec. 
617.16 shall upon the filing of an initial application for TRA or other 
TAA promptly determine the individual's entitlement to such TRA or other 
TAA under this part 617, and may accept for such purposes information 
and findings supplied by another State agency under this part 617.
    (b) Determinations of subsequent applications for TRA or other TAA. 
The State agency shall, upon the filing of an application for payment of 
TRA, or subsistence and transportation under Sec.Sec. 617.27 and 
617.28, with respect to a week, promptly determine whether the 
individual is eligible for a payment of TRA, or subsistence and 
transportation, with respect to such week, and, if eligible, the amount 
of TRA, or subsistence and transportation, for which the individual is 
eligible. In addition, the State agency promptly shall, upon the filing 
of a subsequent application for job search allowances (where the total 
of previous job search allowances paid the individual was less than 
$600), determine whether the individual is eligible for job search 
allowances, and, if eligible, the amount of job search allowances for 
which the individual is eligible.
    (c) Redeterminations. The provisions of the applicable State law 
concerning the right to request, or authority to undertake, 
reconsideration of a determination pertaining to a claim for UI under 
the applicable State law shall apply to determinations pertaining to all 
forms of TAA under this part 617.
    (d) Use of State law. In making determinations or redeterminations 
under this section, or in reviewing such determinations or 
redeterminations underSec. 617.51, a State agency shall apply the 
regulations in this part 617. As to matters committed by this part 617 
to the applicable State law, a State agency, a hearing officer, or a 
State court shall apply the applicable State law and regulations 
thereunder, including procedural requirements of such State law or 
regulations, except so far as such State law or regulations are 
inconsistent with this part 617 or the purpose of this part 617: 
Provided, that, no provision of State law or regulations on good cause 
for waiver of any time limit, or for late filing of any claim, shall 
apply to any time limitation referred to or specified in this part 617, 
unless such State law or regulation is made applicable by a specific 
provision of this part 617.
    (e) Notices to individual. The State agency shall notify the 
individual in writing of any determination or redetermination as to 
entitlement to TAA. Each determination or redetermination shall inform 
the individual of the reason for the determination or redetermination 
and of the right to reconsideration or appeal in the same manner as 
determinations of entitlement to UI are subject to redetermination or 
appeal under the applicable State law.
    (f) Promptness. Full payment of TAA when due shall be made with the 
greatest promptness that is administratively feasible.
    (g) Procedure. Except where otherwise required by the Act or this 
part 617, the procedures for making and furnishing determinations and 
written notices of determinations to individuals, shall be consistent 
with the Secretary's ``Standard for Claim Determinations--Separation 
Information,'' Employment Security Manual, part V, sections 6010-6015 
(appendix B of this part).

[51 FR 45848, Dec. 22, 1986, as amended at 59 FR 939, 943, Jan. 6, 1994]



Sec.  617.51  Appeals and hearings.

    (a) Applicable State law. A determination or redetermination under 
this part 617 shall be subject to review in the same manner and to the 
same extent as determinations and redeterminations under the applicable 
State law, and only in that manner and to that extent. Proceedings for 
review of a determination or redetermination may be consolidated or 
joined with proceedings for review of a determination or redetermination 
under the State law where convenient or necessary. Procedures as to the 
right of appeal and opportunity for fair hearing shall be consistent 
with sections 303(a) (1) and (3) of the

[[Page 138]]

Social Security Act (42 U.S.C. 503(a) (1) and (3)).
    (b) Appeals promptness. Appeals under paragraph (a) of this section 
shall be decided with a degree of promptness meeting the Secretary's 
``Standard on Appeals Promptness--Unemployment Compensation'' (part 650 
of this chapter). Any provisions of the applicable State law for 
advancement or priority of UI cases on judicial calendars, or otherwise 
intended to provide for prompt payment of UI when due, shall apply to 
proceedings involving entitlement to TAA under this part 617.



Sec.  617.52  Uniform interpretation and application.

    (a) First rule of construction. The Act and the implementing 
regulations in this part 617 shall be construed liberally so as to carry 
out the purpose of the Act.
    (b) Second rule of construction. The Act and the implementing 
regulations in this part 617 shall be construed so as to assure insofar 
as possible the uniform interpretation and application of the Act and 
this part 617 throughout the United States.
    (c) Effectuating purpose and rules of construction. (1) To 
effectuate the purpose of the Act and this part 617 and to assure 
uniform interpretation and application of the Act and this part 617 
throughout the United States, a State agency shall forward, not later 
than 10 days after issuance, to the Department a copy of any judicial or 
administrative decision ruling on an individual's entitlement to TAA 
under this part 617. On request of the Department, a State agency shall 
forward to the Department a copy of any determination or redetermination 
ruling on an individual's entitlement to TAA under this part 617.
    (2) If the Department believes that a determination, 
redetermination, or decision is inconsistent with the Department's 
interpretation of the Act or this part 617, the Department may at any 
time notify the State agency of the Department's view. Thereafter, the 
State agency shall issue a redetermination or appeal if possible, and 
shall not follow such determination, redetermination, or decision as a 
precedent; and, in any subsequent proceedings which involve such 
determination, redetermination, or decision, or wherein such 
determination, redetermination, or decision is cited as precedent or 
otherwise relied upon, the State agency shall inform the claims deputy 
or hearing officer or court of the Department's view and shall make all 
reasonable efforts, including appeal or other proceedings in an 
appropriate forum, to obtain modification, limitation, or overruling of 
the determination, redetermination, or decision.
    (3) If the Department believes that a determination, 
redetermination, or decision is patently and flagrantly violative of the 
Act or this part 617, the Department may at any time notify the State 
agency of the Department's view. If the determination, redetermination, 
or decision in question denies TAA to an individual, the steps outlined 
in paragraph (c)(2) of this section shall be followed by the State 
agency. If the determination, redetermination, or decision in question 
awards TAA to an individual, the benefits are ``due'' within the meaning 
of section 303(a)(1) of the Social Security Act (42 U.S.C. 503(a)(1)), 
and therefore must be paid promptly to the individual. However, the 
State agency, shall take the steps outlined in paragraph (c)(2) of this 
section, and payments to the individual may be temporarily delayed if 
redetermination or appeal action is taken not more than one business day 
following the day on which the first payment otherwise would be issued 
to the individual; and the redetermination action is taken or appeal is 
filed to obtain a reversal of the award of TAA and a ruling consistent 
with the Department's view; and the redetermination action or appeal 
seeks an expedited redetermination or appeal within not more than two 
weeks after the redetermination action is taken or the appeal is filed. 
If redetermination action is not taken or appeal is not filed within the 
above time limit, or a redetermination or decision is not obtained 
within the two-week limit, or any redetermination or decision or order 
is issued which affirms the determination, redetermination, or decision 
awarding TAA or allows it to stand in whole or in part, the benefits 
awarded must be paid promptly to the individual.

[[Page 139]]

    (4) (i) If any determination, redetermination, or decision, referred 
to in paragraph (c)(2) or paragraph (c)(3) of this section, is treated 
as a precedent for any future application for TAA, the Secretary will 
decide whether the Agreement with the State entered into under the Act 
and this part 617 shall be terminated andSec. 617.59(f) applied.
    (ii) In the case of any determination, redetermination, or decision 
that is not legally warranted under the Act or this part 617, including 
any determination, redetermination, or decision referred to in paragraph 
(c)(2) or paragraph (c)(3) of this section, the Secretary will decide 
whether the State shall be required to restore the funds of the United 
States for any sums paid under such a determination, redetermination, or 
decision, and whether, in the absence of such restoration, the Agreement 
with the State shall be terminated andSec. 617.59(f) applied and 
whether other action shall be taken to recover such sums for the United 
States.
    (5) A State agency may request reconsideration of a notice issued 
pursuant to paragraph (c)(2) or paragraph (c)(3) of this section, and 
shall be given an opportunity to present views and arguments if desired. 
Such request shall be made to the Secretary and may include views and 
arguments on the matters to be decided by the Secretary under paragraph 
(c)(4) of this section.
    (6) Concurrence of the Department in a determination, 
redetermination, or decision shall not be presumed from the absence of a 
notice issued pursuant to this section.

(Approved by the Office of Management and Budget under control number 
1205-0222)



Sec.  617.53  Subpoenas.

    A State agency may issue subpoenas for attendance of witnesses and 
production of records on the same terms and conditions as under the 
State law. Compliance may be enforced on the same terms and conditions 
as under the State law, or, if a State court declines to enforce a 
subpoena issued under this section, the State agency may petition for an 
order requiring compliance with such subpoena to the United States 
District Court within the jurisdiction of which the relevant proceeding 
under this part 617 is conducted.



Sec.  617.54  State agency rulemaking.

    A State agency may establish supplemental procedures not 
inconsistent with the Act or this part 617 or procedures prescribed by 
the Department to further effective administration of this part 617. The 
exact text of such supplemental procedure or procedures, certified as 
accurate by a responsible official, employee, or counsel of the State 
agency, shall be submitted to the Department, on a form supplied by the 
Department. No supplemental procedure shall be effective unless and 
until approved by the Department. Approval may be granted on a temporary 
basis, not to exceed 90 days, in cases of administrative necessity. On 
reasonable notice to a State agency, approval of a supplemental 
procedure may be withdrawn at any time. If public notice and opportunity 
for hearing would be required under a State law for adoption of a 
similar or analogous procedure involving UI, such public notice and 
opportunity for hearing shall be afforded by the State agency as to the 
supplemental procedure.

(Approved by the Office of Management and Budget under control number 
1205-0222)



Sec.  617.55  Overpayments; penalties for fraud.

    (a) Determination and repayment. (1) If a State agency or a court of 
competent jurisdiction determines that any person or individual has 
received any payment under this part 617 to which the person or 
individual was not entitled, including a payment referred to in 
paragraph (b) or paragraph (c) of this section, such person or 
individual shall be liable to repay such amount to the State agency, and 
the State agency shall recover any such overpayment in accordance with 
the provisions of this part 617; except that the State agency may waive 
the recovery of any such overpayment if the State agency determines, in 
accordance with the guidelines prescribed in paragraph (a)(2) of this 
section, that:
    (i) The payment was made without fault on the part of such person or 
individual; and

[[Page 140]]

    (ii) Requiring such repayment would be contrary to equity and good 
conscience.
    (2)(i)(A) In determining whether fault exists for purposes of 
paragraph (a)(1)(i) of this section, the following factors shall be 
considered:
    (1) Whether a material statement or representation was made by the 
person or individual in connection with the application for TAA that 
resulted in the overpayment, and whether the person or individual knew 
or should have known that the statement or representation was 
inaccurate.
    (2) Whether the person or individual failed or caused another to 
fail to disclose a material fact, in connection with an application for 
TAA that resulted in the overpayment, and whether the person or 
individual knew or should have known that the fact was material.
    (3) Whether the person or individual knew or could have been 
expected to know, that the person or individual was not entitled to the 
TAA payment.
    (4) Whether, for any other reason, the overpayment resulted directly 
or indirectly, and partially or totally, from any act or omission of the 
person or individual or of which the person or individual had knowledge, 
and which was erroneous or inaccurate or otherwise wrong.
    (5) Whether there has been a determination of fraud under paragraph 
(b) of this section or section 243 of the Act.
    (B) An affirmative finding on any one of the factors in paragraphs 
(a)(2)(i)(A) of this section precludes waiver of overpayment recovery.
    (ii)(A) In determining whether equity and good conscience exists for 
purposes of paragraph (a)(1)(ii) of this section, the following factors 
shall be considered:
    (1) Whether the overpayment was the result of a decision on appeal, 
whether the State agency had given notice to the person or individual 
that the case has been appealed and that the person or individual may be 
required to repay the overpayment in the event of a reversal on appeal, 
and whether recovery of the overpayment will not cause extraordinary and 
lasting financial hardship to the person or individual.
    (2) Whether recovery of the overpayment will not cause extraordinary 
financial hardship to the person or individual, and there has been no 
affirmative finding under paragraph (a)(2)(ii)(A) of this section with 
respect to such person or individual and such overpayment.
    (B) An affirmative finding on either of the foregoing factors in 
paragraphs (a)(2)(ii)(A) of this section precludes waiver of overpayment 
recovery.
    (C)(1) For the purpose of paragraph (a)(2)(ii) of this section, an 
extraordinary financial hardship shall exist if recovery of the 
overpayment would result directly in the person's or individual's loss 
of or inability to obtain minimal necessities of food, medicine, and 
shelter for a substantial period of time; and an extraordinary and 
lasting financial hardship shall be extraordinary as described above and 
may be expected to endure for the foreseeable future.
    (2) In applying this test in the case of attempted recovery by 
repayment, a substantial period of time shall be 30 days, and the 
foreseeable future shall be at least three months. In applying this test 
in the case of proposed recoupment from other benefits, a substantial 
period of time and the foreseeable future shall be the longest potential 
period of benefit entitlement as seen at the time of the request for a 
waiver determination. In making these determinations, the State agency 
shall take into account all potential income of the person or individual 
and the person's or individual's firm, organization, or family and all 
cash resources available or potentially available to the person or 
individual and the person's or individual's firm, organization, or 
family in the time period being considered.
    (3) Determinations granting or denying waivers of overpayments shall 
be made only on request for a waiver determination. Such request shall 
be made on a form which shall be furnished to the person or individual 
by the State agency. Notices of determination of overpayments shall 
include an accurate description of the waiver provisions of paragraph 
(a) of this section, if the State agency has elected to allow waivers of 
TAA overpayments.

[[Page 141]]

    (4) Each State shall have the option to establish a policy as to 
whether the waiver provisions of this section shall be applied to TAA 
overpayments. A State's decision on its policy shall not be controlled 
by whether it waives UI overpayments, but the State's decision shall be 
published for the information of the public and the Department.
    (5)(i) Unless an overpayment is otherwise recovered, or is waived 
under paragraph (a) of this section, the State agency shall recover the 
overpayment by deduction from any sums payable to such person or 
individual under:
    (A) This part 617;
    (B) Any Federal unemployment compensation law administered by the 
State agency; or
    (C) Any other Federal law administered by the State agency which 
provides for the payment of unemployment assistance or an allowance with 
respect to unemployment.
    (ii) In addition, a State agency may recover the overpayment from 
unemployment insurance payable to such person or individual under the 
State law.
    (b) Fraud. If a State agency or a court of competent jurisdiction 
finds that any person or individual:
    (1) Knowingly has made, or caused another to make, a false statement 
or representation of a material fact; or
    (2) Knowingly has failed, or caused another to fail, to disclose a 
material fact; and as a result of such false statement or 
representation, or of such nondisclosure, such individual has received 
any payment under this part 617 to which the person or individual was 
not entitled, such person or individual shall, in addition to any other 
penalty provided by law, be ineligible for any further payments under 
this part 617.
    (c) Training, job search and relocation allowances. (1) If an 
individual fails, with good cause, to complete training, a job search, 
or a relocation, any payment or portion of a payment made under this 
part 617 to such individual or any person that is not properly and 
necessarily expended in attempting to complete such training, job 
search, or relocation, shall constitute an overpayment.
    (2) If an individual fails, without good cause, to complete 
training, a job search, or a relocation, any payment made under this 
part 617 to such individual or any person shall constitute an 
overpayment.
    (3) Such overpayment shall be recovered or waived as provided in 
paragraph (a) of this section.
    (d) Final determination. Except for overpayments determined by a 
court of competent jurisdiction, no repayment may be required, and no 
deduction may be made, under this section until a determination under 
paragraph (a) of this section by the State agency has been made, notice 
of the determination and an opportunity for a fair hearing thereon has 
been given to the person or individual concerned, and the determination 
has become final.
    (e) Deposit. Any amount recovered by a State agency under this 
section shall be deposited into the Federal fund or account from which 
payment was made.
    (f) Procedural requirements. (1) The provisions of paragraphs (c), 
(e), and (g) ofSec. 617.50 shall apply to determinations and 
redeterminations made pursuant to this section.
    (2) The provisions ofSec. 617.51 shall apply to determinations and 
redeterminations made pursuant to this section.
    (g) Fraud detection and prevention. State procedures for the 
detection and prevention of fraudulent overpayments of TAA shall be, as 
a minimum, commensurate with the procedures adopted by the State with 
respect to State unemployment compensation and consistent with the 
Secretary's ``Standard for Fraud and Overpayment Detection,'' Employment 
Security Manual, Part V, sections 7510-7515 (Appendix C of this part).
    (h) Debts due the United States or Others. (1) Notwithstanding any 
provision of this part 617, TAA payable to a person or an individual 
under this part 617 shall be applied by the State agency for the 
recovery by offset of any debt due the United States from the person or 
individual.
    (2) TAA shall not be applied or used by the State agency in any 
manner for the payment of any debt of any person or individual to any 
State or any other entity or person, except that TRA payable to an 
individual shall be payable

[[Page 142]]

to someone other than the individual if required by State law and 
Federal law to satisfy the individual's obligation for child support or 
alimony.
    (i) Definition of person. For purposes of this section, a person 
includes any employer or other entity or organization as well as the 
officers and officials thereof who may bear individual responsibility.

[59 FR 939, Jan. 6, 1994, as amended at 59 FR 943, Jan. 6, 1994]



Sec.  617.56  Inviolate rights to TAA.

    Except as specifically provided in this part 617, the rights of 
individuals to TAA shall be protected in the same manner and to the same 
extent as the rights of persons to UI are protected under the applicable 
State law. Such measures shall include protection of applicants for TAA 
from waiver, release, assignment, pledge, encumbrance, levy, execution, 
attachment, and garnishment of their rights to TAA, except as provided 
inSec. 617.55. In the same manner and to the same extent, individuals 
shall be protected from discrimination and obstruction in regard to 
seeking, applying for, and receiving any right to TAA.



Sec.  617.57  Recordkeeping; disclosure of information.

    (a) Recordkeeping. Each State agency will make and maintain records 
pertaining to the administration of the Act as the Secretary requires 
and will make all such records available for inspection, examination and 
audit by such Federal officials as the Secretary may designate or as may 
be required by law. Such recordkeeping will be adequate to support the 
reporting of TAA activity on reporting form ETA 563 approved under OMB 
control number 1205-0016.
    (b) Disclosure of information. Information in records maintained by 
a State agency in administering the Act shall be kept confidential, and 
information in such records may be disclosed only in the same manner and 
to the same extent as information with respect to UI and the entitlement 
of individuals thereto may be disclosed under the applicable State law. 
Such information shall not, however, be disclosed to an employer or any 
other person except to the extent necessary to obtain information from 
the employer or other person for the purposes of this part 617. This 
provision on the confidentiality of information maintained in the 
administration of the Act shall not apply, however, to the Department or 
for the purposes ofSec. 617.55 or paragraph (a) of this section, or in 
the case of information, reports and studies required pursuant toSec. 
617.61, or where the result would be inconsistent with the Freedom of 
Information Act (5 U.S.C. 552), the Privacy Act of 1974 (5 U.S.C. 552a), 
or regulations of the Department promulgated thereunder (see 29 CFR 
parts 70 and 70a).



Sec.  617.58  Unemployment insurance.

    Unemployment insurance payable to an adversely affected worker shall 
not be denied or reduced for any week by reason of any right to a 
payment of TAA under the Act and this part 617.



Sec.  617.59  Agreements with State agencies.

    (a) Authority. Before performing any function or exercising any 
jurisdiction under the Act and this part 617, a State or State agency 
(as defined inSec. 617.3(ii)) shall execute an Agreement with the 
Secretary meeting the requirements of the Act.
    (b) Execution. An Agreement under paragraph (a) of this section 
shall be signed on behalf of a State or State agency by an authorized 
official of the State or such State agency, and the signature shall be 
dated. The authority of the State or State agency official shall be 
certified by the Attorney General of the State or counsel for the State 
agency, unless the Agreement is signed by the Governor of the State. An 
agreement will be executed on behalf of the United States by the 
Secretary.
    (c) Public access to Agreements. The State agency will make 
available to any individual or organization an accurate copy of the 
Agreement with the Agency for inspection and copying. Copies of an 
Agreement may be furnished on request to any individual or organization 
upon payment of the same charges, if any, as apply to the furnishing of 
copies of other records of the State agency.

[[Page 143]]

    (d) Amended Agreement. A State or State agency shall execute an 
amended Agreement with the Secretary prior to administering any 
amendments to the TAA provisions of the Trade Act of 1974.
    (e) Agent of United States. In making determinations, 
redeterminations, and in connection with proceedings for review thereof, 
a State or State agency which has executed an Agreement as provided in 
this section shall be an agent of the United States and shall carry out 
fully the purposes of the Act and this part 617.
    (f) Breach. If the Secretary finds that a State or State agency has 
not fulfilled its commitments under its Agreement under this section, 
section 3302(c)(3) of the Internal Revenue Code of 1986 shall apply. A 
State or State agency shall receive reasonable notice and opportunity 
for hearing before a finding is made under section 3302(c)(3) whether 
there has been a failure to fulfill the commitments under the Agreement.
    (g) Secretary's review of State agency compliance. The appropriate 
Regional Administrator shall be initially responsible for the periodic 
monitoring and reviewing of State and State agency compliance with the 
Agreement entered into under this section.
    (h) Program coordination. State agencies providing employment 
services, training and supplemental assistance under Subpart C of this 
part shall, in accordance with their Agreements under this section, 
coordinate such services and payments with programs and services 
provided by the Workforce Investment Act and with the State agency 
administering the State law.
    (i) Administration absent State Agreement. In any State in which no 
Agreement under this section is in force, the Secretary shall administer 
the Act and this part 617 and pay TAA hereunder through appropriate 
arrangements made by the Department, and for this purpose the Secretary 
or the Department shall be substituted for the State or cooperating 
State agency wherever appropriate in this part 617. Such arrangements 
shall include the requirement that TAA be administered in accordance 
with this part 617, and the provisions of the applicable State law 
except to the extent that such State law is inconsistent with any 
provision of this part 617 or section 303 of the Social Security Act (42 
U.S.C. 503) or section 3304(a) of the Internal Revenue Code of 1986 (26 
U.S.C. 3304(a)), and shall also include provision for a fair hearing for 
any individual whose application for TAA is denied. A final 
determination under paragraph (i) of this section as to entitlement to 
TAA shall be subject to review by the courts in the same manner and to 
the same extent as is provided by section 205(g) of the Social Security 
Act (42 U.S.C. 405(g)).

[51 FR 45848, Dec. 22, 1986, as amended at 53 FR 32351, Aug. 24, 1988; 
59 FR 941, Jan. 6, 1994; 71 FR 35516, June 21, 2006]



Sec.  617.60  Administration requirements. [Reserved]



Sec.  617.61  Information, reports, and studies.

    A State agency shall furnish to the Secretary such information and 
reports and conduct such studies as the Secretary determines are 
necessary or appropriate for carrying out the purposes of the Act and 
this part 617.



Sec.  617.64  Termination of TAA program benefits.

    The following rules are applicable to the termination of TAA 
benefits under the Act:
    (a) No application for TRA, or transportation or subsistence payment 
while in training approved under subpart C of this part 617, shall be 
approved, and no payment of TRA or payment for transportation or 
subsistence occurring on or before the termination date shall be made 
after the termination date specified in the Act, unless the claim for 
TRA or an invoice for transportation and subsistence is presented to the 
State agency and a final determination is made on the amount payable on 
or before the termination date in the Act.
    (b) No payment of job search or relocation allowances shall be made 
after the termination date specified in the Act, unless an application 
for such allowances was approved, such job search or relocation was 
completed, and a final determination made on the amount payable for such 
benefits by

[[Page 144]]

the State agency on or before the termination date in the Act.
    (c) No training under subpart C of this part shall be approved 
unless a determination regarding the approval of such training was made 
on or before the termination date in the Act, and such training 
commenced on or before such termination date. Consistent with the 
requirements of section 236(a)(1) of the Act, and the termination 
provisions of paragraph (c) of this section, a final determination must 
be made on the invoice for the training costs by the State agency on or 
before the termination date specified in the Act to cover tuition 
related expenses. Determinations on tuition bills shall be limited to 
the training term, quarter, semester or other period beginning on or 
before the termination date in the Act. The training period should be in 
accord with normal billing practices of the training provider and/or 
State agency approval practices.

[59 FR 941, Jan. 6, 1994]



    Sec. Appendix A to Part 617--Standard for Claim Filing, Claimant 
             Reporting, Job Finding, and Employment Services

         Employment Security Manual (Part V, Sections 5000-5004)

                         5000-5099 Claims Filing

  5000 Standard for Claim Filing, Claimant Reporting, Job Finding, and 
                           Employment Services

    A. Federal law requirements. Section 3304(a)(1) of the Federal 
Unemployment Tax Act and section 303(a)(2) of the Social Security Act 
require that a State law provide for:
    ``Payment of unemployment compensation solely through public 
employment offices or such other agencies as the Secretary may 
approve.''
    Section 3304(a)(4) of the Federal Unemployment Tax and section 
303(a)(5) of the Social Security Act require that a State law provide 
for:
    ``Expenditure of all money withdrawn from an unemployment fund of 
such State, in the payment of unemployment compensation * * *''
    Section 303(a)(1) of the Social Security Act requires that the State 
law provide for:
    ``Such methods of administration * * * as are found by the Secretary 
to be reasonably calculated to insure full payment of unemployment 
compensation when due.''
    B. Secretary's interpretation of federal law requirements.
    1. The Secretary interprets section 3304(a)(1) of the Federal 
Unemployment Tax Act and section 303(a)(2) of the Social Security Act to 
require that a State law provide for payment of unemployment 
compensation solely through public employment offices or claims offices 
administered by the State employment security agency if such agency 
provides for such coordination in the operations of its public 
employment offices and claims offices as will insure (a) the payment of 
benefits only to individuals who are unemployed and who are able to work 
and available for work, and (b) that individuals claiming unemployment 
compensation (claimants) are afforded such placement and other 
employment services as are necessary and appropriate to return them to 
suitable work as soon as possible.
    2. The Secretary interprets all the above sections to require that a 
State law provide for:
    a. Such contact by claimants with public employment offices or 
claims offices or both, (1) as will reasonably insure the payment of 
unemployment compensation only to individuals who are unemployed and who 
are able to work and available for work, and (2) that claimants are 
afforded such placement and other employment services as are necessary 
and appropriate to facilitate their return to suitable work as soon as 
possible; and
    b. Methods of administration which do not unreasonably limit the 
opportunity of individuals to establish their right to unemployment 
compensation due under such States law.

   5001 Claim Filing and Claimant Reporting Requirements Designed To 
                   Satisfy Secretary's Interpretation

    A. Claim filing--total or part-total unemployment
    1. Individuals claiming unemployment compensation for total or part-
total unemployment are required to file a claim weekly or biweekly, in 
person or by mail, at a public employment office or a claims office 
(these terms include offices at itinerant points) as set forth below.
    2. Except as provided in paragraph 3, a claimant is required to file 
in person.
    a. His new claim with respect to a benefit year, or his continued 
claim for a waiting week or for his first compensable week of 
unemployment in such year; and
    b. Any other claim, when requested to do so by the claims personnel 
at the office at which he files his claim(s) because questions about his 
right to benefits are raised by circumstances such as the following:
    (1) The conditions or circumstances of his separation from 
employment;

[[Page 145]]

    (2) The claimant's answers to questions on mail claim(s) indicate 
that he may be unable to work or that there may be undue restrictions on 
his availability for work or that his search for work may be inadequate 
or that he may be disqualified;
    (3) The claimant's answers to questions on mail claims create 
uncertainty about his credibility or indicate a lack of understanding of 
the applicable requirements; or
    (4) The claimant's record shows that he has previously filed a 
fraudulent claim.
    In such circumstances, the claimant is required to continue to file 
claims in person each week (or biweekly) until the State agency 
determines that filing claims in person is no longer required for the 
resolution of such questions.
    3. A claimant must be permitted to file a claim by mail in any of 
the following circumstances:
    a. He is located in an area requiring the expenditure of an 
unreasonable amount of time or money in traveling to the nearest 
facility established by the State agency for filing claims in person;
    b. Conditions make it impracticable for the agency to take claims in 
person;
    c. He has returned to full-time work on or before the scheduled date 
for his filing a claim, unless the agency makes provision for in-person 
filing at a time and place that does not interfere with his employment;
    d. The agency finds that he has good cause for failing to file a 
claim in person.
    4. A claimant who has been receiving benefits for partial 
unemployment may continue to file claims as if he were a partially 
unemployed worker for the first four consecutive weeks of total or part-
total unemployment immediately following his period of partial 
unemployment so long as he remains attached to his regular employer.
    B. Claim filing--partial unemployment. Each individual claiming 
unemployment compensation for a week (or other claim period) during 
which, because of lack of work, he is working less than his normal 
customary full-time hours for his regular employer and is earning less 
than the earnings limit provided in the State law, shall not be required 
to file a claim for such week or other claim period earlier than 2 weeks 
from the date that wages are paid for such claim period or, if a low 
earnings report is required by the State law, from the date the employer 
furnished such report to the individual. State agencies may permit 
claims for partial unemployment to be filed either in person or by mail, 
except that in the circumstances set forth in section A 3, filing by 
mail must be permitted, and in the circumstances set forth in section A 
2 b, filing in person may be required.

   5002 Requirement for Job Finding, Placement, and Other Employment 
         Services Designed To Satisfy Secretary's Interpretation

    A. Claims personnel are required to assure that each claimant is 
doing what a reasonable individual in his circumstances would do to 
obtain suitable work.
    B. In the discretion of the State agency:
    1. The claims personnel are required to give each claimant such 
necessary and appropriate assistance as they reasonably can in finding 
suitable work and at their discretion determine when more complete 
placement and employment services are necessary and appropriate for a 
claimant; and if they determine more complete services are necessary and 
appropriate, the claims personnel are to refer him to employment service 
personnel in the public employment office in which he has been filing 
claim(s), or, if he has been filing in a claims office, in the public 
employment office most accessible to him; or
    2. All placement and employment services are required to be afforded 
to each claimant by employment service personnel in the public 
employment office most accessible to him in which case the claims 
personnel in the office in which the claimant files his claim are to 
refer him to the employment service personnel when placement or other 
employment services are necessary and appropriate for him.
    C. The personnel to whom the State agency assigns the 
responsibilities outlined in paragraph B above are required to give 
claimants such job-finding assistance, placement, and other employment 
services as are necessary and appropriate to facilitate their return to 
suitable work as soon as possible.
    In some circumstances, no such services or only limited services may 
be required. For example, if a claimant is on a short-term temporary 
layoff with a fixed return date, the only service necessary and 
appropriate to be given to him during the period of the layoff is a 
referral to suitable temporary work if such work is being performed in 
the labor market area.
    Similarly, claimants whose unemployment is caused by a labor dispute 
presumably will return to work with their employer as soon as the labor 
dispute is settled. They generally do not need services, nor do 
individuals in occupations where placement customarily is made by other 
nonfee charging placement facilities such as unions and professional 
associations.
    Claimants who fall within the classes which ordinarily would require 
limited services or no services shall, if they request placement and 
employment services, be afforded such services as are necessary and 
appropriate for them to obtain suitable work or to achieve their 
reasonable employment goals.

[[Page 146]]

    On the other hand, a claimant who is permanently separated from his 
job is likely to require some services. He may need only some direction 
in how to get a job; he may need placement services if he is in an 
occupation for which there is some demand in the labor market area; if 
his occupation is outdated, he may require counseling and referral to a 
suitable training course. The extent and character of the services to be 
given any particular claimant may change with the length of his 
unemployment and depend not only on his own circumstances and 
conditions, but also on the condition of the labor market in the area.
    D. Claimants are required to report to employment service personnel, 
as directed, but such personnel and the claims personnel required to so 
arrange and coordinate the contacts required of a claimant as not to 
place an unreasonable burden on him or unreasonably limit his 
opportunity to establish his rights to compensation. As a general rule, 
a claimant is not required to contact in person claims personnel or 
employment service personnel more frequently than once a week, unless he 
is directed to report more frequently for a specific service such as 
referral to a job or a training course or counseling which cannot be 
completed in one visit.
    E. Employment service personnel are required to report promptly to 
claims personnel in the office in which the claimant files his claim(s): 
(1) his failure to apply for or accept work to which he was referred by 
such personnel or when known, by any other nonfee-charging placement 
facility such as a union or a professional association; and (2) any 
information which becomes available to it that may have a bearing on the 
claimant's ability to work or availability for work, or on the 
suitability of work to which he was referred or which was offered to 
him.

             5004 Evaluation of Alternative State Provisions

    If the State law provisions do not conform to the ``suggested State 
law requirements'' set forth in sections 5001 and 5002, but the State 
law contains alternative provisions, the Manpower Administrator, in 
collaboration with the State agency, will study the actual or 
anticipated affect of the alternative provisions. If the Manpower 
Administrator concludes that the alternative provisions satisfy the 
requirements of the Federal law as construed by the Secretary (see 
section 5000 B) he will so notify the State agency. If he does not so 
conclude, he will submit the matter to the Secretary. If the Secretary 
concludes that the alternative provisions satisfy such requirements, the 
State agency will be so notified. If the Secretary concludes that there 
is a question as to whether the alternative provisions satisfy such 
requirements, the State agency will be advised that unless the State law 
provisions are appropriately revised, a notice of hearing will be issued 
as required by the Code of Federal Regulations, title 20, section 601.3.

[59 FR 943, Jan. 6, 1994]



    Sec. Appendix B to Part 617--Standard for Claim Determinations--
                         Separation Information

    6010 Federal Law Requirements. Section 303(a)(1) of the Social 
Security Act requires that a State law include provision for:
    ``Such methods of administration . . . as are found by the Secretary 
to be reasonably calculated to insure full payment of unemployment 
compensation when due.''
    Section 303(a)(3) of the Social Security Act requires that a State 
law include provision for:
    ``Opportunity for a fair hearing before an impartial tribunal, for 
all individuals whose claims for unemployment compensation are denied.''
    Section 3304(a)(4) of the Federal Unemployment Tax Act and section 
303(a)(5) of the Social Security Act require that a State law include 
provision for:
    ``Expenditure of all money withdrawn from an unemployment fund of 
such State, in the payment of unemployment compensation. . . .
    Section 3306(h) of the Federal Unemployment Tax Act defines 
``compensation'' as ``cash benefits payable to individuals with respect 
to their unemployment.''
    6011 Secretary's Interpretation of Federal Law Requirements. The 
Secretary interprets the above sections to require that a State law 
include provisions which will insure that:
    A. Individuals who may be entitled to unemployment compensation are 
furnished such information as will reasonably afford them an opportunity 
to know, establish, and protect their rights under the unemployment 
compensation law of such State, and
    B. The State agency obtains and records in time for the prompt 
determination and review of benefit claims such information as will 
reasonably insure the payment of benefits to individuals to whom 
benefits are due.
    6012 Criteria for Review of State Law Conformity with Federal 
Requirements:
    In determining the conformity of a State law with the above 
requirements of the Federal Unemployment Tax Act and the Social Security 
Act as interpreted by the Secretary, the following criteria will be 
applied:
    A. Is it required that individuals who may be entitled to 
unemployment compensation be furnished such information of their 
potential rights to benefits, including the manner and places of filing 
claims, the reasons for determinations, and their rights of appeal, as 
will insure them a reasonable opportunity to

[[Page 147]]

know, establish, and protect their rights under the law of the State?
    B. Is the State agency required to obtain, in time for prompt 
determination of rights to benefits such information as will reasonably 
insure the payment of benefits to individuals to whom benefits are due?
    C. Is the State agency required to keep records of the facts 
considered in reaching determinations of rights to benefits?
    6013 Claim Determinations Requirements Designed To Meet Department 
of Labor Criteria:
    A. Investigation of claims. The State agency is required to obtain 
promptly and prior to a determination of an individual's right to 
benefits, such facts pertaining thereto as will be sufficient reasonably 
to insure the payment of benefits when due.
    This requirement embraces five separate elements:
    1. It is the responsibility of the agency to take the initiative in 
the discovery of information. This responsibility may not be passed on 
to the claimant or the employer. In addition to the agency's own 
records, this information may be obtained from the worker, the employer, 
or other sources. If the information obtained in the first instance 
discloses no essential disagreement and provides a sufficient basis for 
a fair determination, no further investigation is necessary. If the 
information obtained from other sources differs essentially from that 
furnished by the claimant, the agency, in order to meet its 
responsibility, is required to inform the claimant of such information 
from other sources and to afford the claimant an opportunity to furnish 
any further facts he may have.
    2. Evidentiary facts must be obtained as distinguished from ultimate 
facts or conclusions. That a worker was discharged for misconduct is an 
ultimate fact or conclusion; that he destroyed a machine upon which he 
was working is a primary or evidentiary fact, and the sort of fact that 
the requirement refers to.
    3. The information obtained must be sufficient reasonably to insure 
the payment of benefits when due. In general, the investigation made by 
the agency must be complete enough to provide information upon which the 
agency may act with reasonable assurance that its decision is consistent 
with the unemployment compensation law. On the other hand, the 
investigation should not be so exhaustive and time-consuming as unduly 
to delay the payment of benefits and to result in excessive costs.
    4. Information must be obtained promptly so that the payment of 
benefits is not unduly delayed.
    5. If the State agency requires any particular evidence from the 
worker, it must give him a reasonable opportunity to obtain such 
evidence.
    B. Recording of facts. The agency must keep a written record of the 
facts considered in reaching its determinations.
    C. Determination notices:
    1. The agency must give each claimant a written notice of:
    a. Any monetary determination with respect to his benefit year;
    b. Any determination with respect to purging a disqualification if, 
under the State law, a condition or qualification must be satisfied with 
respect to each week of disqualification; but in lieu of giving written 
notice of each determination for each week in which it is determined 
that the claimant has met the requirements for purging, the agency may 
inform the claimant that he has purged the disqualification for a week 
by notation on his applicant identification card or otherwise in 
writing.
    c. Any other determination which adversely affects his rights to 
benefits, except that written notice of determination need not be given 
with respect to:
    (1) A week in a benefit year for which the claimant's weekly benefit 
amount is reduced in whole or in part by earnings if, the first time in 
the benefit year that there is such a reduction, he is required to be 
furnished a booklet or leaflet containing the information set forth 
below in paragraph 2f(1). However, a written notice of determination is 
required if: (a) there is a dispute concerning the reduction with 
respect to any week (e.g., as to the amount computed as the appropriate 
reduction, etc.); or (b) there is a change in the State law (or in the 
application thereof) affecting the reduction; or
    (2) Any week in a benefit year subsequent to the first week in such 
benefit year in which benefits were denied, or reduced in whole or in 
part for reasons other than earnings, if denial or reduction for such 
subsequent week is based on the same reason and the same facts as for 
the first week, and if written notice of determination is required to be 
given to the claimant with respect to such first week, and with such 
notice of determination, he is required to be given a booklet or 
pamphlet containing the information set forth below in paragraph 2f(2) 
and 2h. However, a written notice of determination is required if: (a) 
there is a dispute concerning the denial or reduction of benefits with 
respect to such week; or (b) there is a change in the State law (or in 
the application thereof) affecting the denial or reduction; or (c) there 
is a change in the amount of the reduction except as to the balance 
covered by the last reduction in a series of reductions.
    Note: This procedure may be applied to determinations made with 
respect to any subsequent weeks for the same reason and on the basis of 
the same facts: (a) that claimant is unable to work, unavailable for 
work, or is

[[Page 148]]

disqualified under the labor dispute provision; and (b) reducing 
claimant's weekly benefit amount because of income other than earnings 
or offset by reason of overpayment.
    2. The agency must include in written notices of determinations 
furnished to claimants sufficient information to enable them to 
understand the determinations, the reasons therefor, and their rights to 
protest, request reconsideration, or appeal.
    The written notice of monetary determination must contain the 
information specified in the following items (except h) unless an item 
is specifically not applicable. A written notice of any other 
determination must contain the information specified in as many of the 
following items as are necessary to enable the claimant to understand 
the determination and to inform him of his appeal rights. Information 
specifically applicable to the individual claimant must be contained in 
the written notice of determination. Information of general application 
such as (but not limited to) the explanation of benefits for partial 
unemployment, information as to deductions, seasonality factors, and 
information as to the manner and place of taking an appeal, extension of 
the appeal period, and where to obtain information and assistance may be 
contained in a booklet or leaflet which is given the claimant with his 
monetary determination.
    a. Base period wages. The statement concerning base-period wages 
must be in sufficient detail to show the basis of computation of 
eligibility and weekly and maximum benefit amounts. (If maximum benefits 
are allowed, it may not be necessary to show details of earnings.)
    b. Employer name. The name of the employer who reported the wage is 
necessary so that the worker may check the wage transcript and know 
whether it is correct. If the worker is given only the employer number, 
he may not be able to check the accuracy of the wage transcript.
    c. Explanation of benefit formula--weekly and maximum benefit 
amounts. Sufficient information must be given the worker so that he will 
understand how his weekly benefit amount, including allowances for 
dependents, and his maximum benefit amount were figured. If benefits are 
computed by means of a table contained in the law, the table must be 
furnished with the notice of determination whether benefits are granted 
or denied.
    The written notice of determination must show clearly the weekly 
benefit amount and the maximum potential benefits to which the claimant 
is entitled.
    The notice to a claimant found ineligible by reason of insufficient 
earnings in the base period must inform him clearly of the reason for 
ineligibility. An explanation of the benefit formula contained in a 
booklet or pamphlet should be given to each claimant at or prior to the 
time he receives written notice of a monetary determination.
    d. Benefit year. An explanation of what is meant by the benefit year 
and identification of the claimant's benefit year must be included in 
the notice of determination.
    e. Information as to benefits for partial unemployment. There must 
be included either in the written notice of determination or in a 
booklet or pamphlet accompanying the notice an explanation of the 
claimant's rights to partial benefits for any week with respect to which 
he is working less than his normal customary full-time workweek because 
of lack of work and for which he earns less than his weekly benefit 
amount or weekly benefit amount plus earnings, whichever is provided by 
the State law. If the explanation is contained in the notice of 
determination, reference to the item in the notice in which his weekly 
benefit amount is entered should be made.
    f. Deductions from weekly benefits:
    (1) Earnings. Although written notice of determinations deducting 
earnings from a claimant's weekly benefit amount is generally not 
required (see paragraph 1 c (1) above), where written notice of 
determination is required (or given) it shall set forth the amount of 
earnings, the method of computing the deduction in sufficient detail to 
enable the claimant to verify the accuracy of the deduction, and his 
right to protest, request redetermination, and appeal. Where a written 
notice of determination is given to the claimant because there has been 
a change in the State law or in the application of the law, an 
explanation of the change shall be included.
    When claimant is not required to receive a written notice of 
determination, he must be given a booklet or pamphlet the first time in 
his benefit year that there is a deduction for earnings which shall 
include the following information:
    (a) The method of computing deductions for earnings in sufficient 
detail to enable the claimant to verify the accuracy of the deduction;
    (b) That he will not automatically be given a written notice of 
determination for a week with respect to which there is a deduction for 
earnings (unless there is a dispute concerning the reduction with 
respect to a week or there has been a change in the State law or in the 
application of the law affecting the deduction) but that he may obtain 
such a written notice upon request; and
    (c) A clear statement of his right to protest, request a 
redetermination, and appeal from any determination deducting earnings 
from his weekly benefit amount even though he does not automatically 
receive a written notice of determination; and if the State law requires 
written notice of determination in

[[Page 149]]

order to effectuate a protest, redetermination, or appeal, he must be so 
advised and advised also that he must request a written notice of 
determination before he takes any such action.
    (2) Other deductions:
    (a) A written notice of determination is required with respect to 
the first week in claimant's benefit year in which there is a reduction 
from his benefits for a reason other than earnings. This notice must 
describe the deduction made from claimant's weekly benefit amount, the 
reason for the deduction, the method of computing it in sufficient 
detail to enable him to verify the accuracy of such deduction, and his 
right to protest, request redetermination, or appeal.
    (b) A written notice of determination is not required for subsequent 
weeks that a deduction is made for the same reason and on the basis of 
the same facts, if the notice of determination pursuant to (2) (a), or a 
booklet or pamphlet given him with such notice explains (i) the several 
kinds of deductions which may be made under the State law (e.g., 
retirement pensions, vacation pay, and overpayments); (ii) the method of 
computing each kind of deduction in sufficient detail that claimant will 
be able to verify the accuracy of deductions made from his weekly 
benefit payments; (iii) any limitation on the amount of any deduction or 
the time in which any deduction may be made; (iv) that he will not 
automatically be given a written notice of determination for subsequent 
weeks with respect to which there is a deduction for the same reason and 
on the basis of the same facts, but that he may obtain a written notice 
of determination upon request; (v) his right to protest, request 
redetermination, or appeal with respect to subsequent weeks for which 
there is a reduction from his benefits for the same reason, and on the 
basis of the same facts even though he does not automatically receive a 
written notice of determination; and (vi) that if the State law requires 
written notice of determination in order to effectuate a protest, 
redetermination, or appeal, he must be so advised and advised also that 
he must request a written notice of determination before he takes any 
such action.
    g. Seasonality factors. If the individual's determination is 
affected by seasonality factors under the State law, an adequate 
explanation must be made. General explanations of seasonality factors 
which may affect determinations for subsequent weeks may be included in 
a booklet or pamphlet given claimant with his notice of monetary 
determinations.
    h. Disqualification or ineligibility. If a disqualification is 
imposed, or if the claimant is declared ineligible for one or more 
weeks, he must be given not only a statement of the period of 
disqualification or ineligibility and the amount of wage-credit 
reductions, if any, but also an explanation of the reason for the 
ineligibility or disqualification. This explanation must be sufficiently 
detailed so that he will understand why he is ineligible or why he has 
been disqualified, and what he must do in order to requalify for 
benefits or purge the disqualification. The statement must be 
individualized to indicate the facts upon which the determination was 
based, e.g., state, ``It is found that you left your work with Blank 
Company because you were tired of working; the separation was voluntary, 
and the reason does not constitute good cause,'' rather than merely the 
phrase ``voluntary quit.'' Checking a box as to the reason for the 
disqualification is not a sufficiently detailed explanation. However, 
this statement of the reason for the disqualification need not be a 
restatement of all facts considered in arriving at the determination.
    i. Appeal rights. The claimant must be given information with 
respect to his appeal rights.
    (1) The following information shall be included in the notice of 
determination:
    (a) A statement that he may appeal or, if the State law requires or 
permits a protest or redetermination before an appeal, that he may 
protest or request a redetermination.
    (b) The period within which an appeal, protest, or request for 
redetermination must be filed. The number of days provided by statute 
must be shown as well as either the beginning date or ending date of the 
period. (It is recommended that the ending date of the appeal period be 
shown, as this is the more understandable of the alternatives.)
    (2) The following information must be included either in the notice 
of determination or in separate informational material referred to in 
the notice:
    (a) The manner in which the appeal, protest, or request for 
redetermination must be filed, e.g., by signed letter, written 
statement, or on a prescribed form, and the place or places to which the 
appeal, protest, or request for redetermination may be mailed or hand-
delivered.
    (b) An explanation of any circumstances (such as nonworkdays, good 
cause, etc.) which will extend the period for the appeal, protest, or 
request for redetermination beyond the date stated or identified in the 
notice of determination.
    (c) That any further information claimant may need or desire can be 
obtained together with assistance in filing his appeal, protest, or 
request for redetermination from the local office.
    If the information is given in separate material, the notice of 
determination would adequately refer to such material if it said, for 
example, ``For other information about your (appeal), (protest), 
(redetermination) rights, see pages ---- to ---- of the ---- (name of 
pamphlet or booklet) heretofore furnished to you.''

[[Page 150]]

    6014 Separation Information Requirements Designed To Meet Department 
of Labor Criteria:
    A. Information to agency. Where workers are separated, employers are 
required to furnish the agency promptly, either upon agency request or 
upon such separation, a notice describing the reasons for and the 
circumstances of the separation and any additional information which 
might affect a claimant's right to benefits. Where workers are working 
less than full time, employers are required to furnish the agency 
promptly, upon agency request, information concerning a claimant's hours 
of work and his wages during the claim periods involved, and other facts 
which might affect a claimant's eligibility for benefits during such 
periods.
    When workers are separated and the notices are obtained on a request 
basis, or when workers are working less than full time and the agency 
requests information, it is essential to the prompt processing of claims 
that the request be sent out promptly after the claim is filed and the 
employer be given a specific period within which to return the notice, 
preferably within 2 working days.
    When workers are separated and notices are obtained upon separation, 
it is essential that the employer be required to send the notice to the 
agency with sufficient promptness to insure that, if a claim is filed, 
it may be processed promptly. Normally, it is desirable that such a 
notice be sent to the central office of the agency, since the employer 
may not know in which local office the worker will file his claim. The 
usual procedure is for the employer to give the worker a copy of the 
notice sent by the employer to the agency.
    B. Information to worker:
    1. Information required to be given. Employers are required to give 
their employees information and instructions concerning the employees' 
potential rights to benefits and concerning registration for work and 
filing claims for benefits.
    The information furnished to employees under such a requirement need 
not be elaborate; it need only be adequate to insure that the worker who 
is separated or who is working less than full time knows he is 
potentially eligible for benefits and is informed as to what he is to do 
or where he is to go to file his claim and register for work. When he 
files his claim, he can obtain more detailed information.
    In States that do not require employers to furnish periodically to 
the State agency detailed reports of the wages paid to their employees, 
each employer is required to furnish to his employees information as to 
(a) the name under which he is registered by the State agency, (b) the 
address where he maintains his payroll records, and (c) the workers' 
need for this information if and when they file claims for benefits.
    2. Methods for giving information. The information and instructions 
required above may be given in any of the following ways:
    a. Posters prominently displayed in the employer's establishment. 
The State agency should supply employers with a sufficient number of 
posters for distribution throughout their places of business and should 
see that the posters are conspicuously displayed at all times.
    b. Leaflets. Leaflets distributed either periodically or at the time 
of separation or reduction of hours. The State agency should supply 
employers with a sufficient number of leaflets.
    c. Individual notices. Individual notices given to each employee at 
the time of separation or reduction in hours.
    It is recommended that the State agency's publicity program be used 
to supplement the employer-information requirements. Such a program 
should stress the availability and location of claim-filing offices and 
the importance of visiting those offices whenever the worker is 
unemployed, wishes to apply for benefits, and to seek a job.
    6015 Evaluation of Alternative State Provisions with Respect to 
Claim Determinations and Separation Information. If the State law 
provisions do not conform to the suggested requirements set forth in 
sections 6013 and 6014, but the State law contains alternative 
provisions, the Bureau of Employment Security, in collaboration with the 
State agency, will study the actual or anticipated effects of the 
alternative provisions. If the Administrator of the Bureau concludes 
that the alternative provisions satisfy the criteria in section 6012, he 
will so notify the State agency. If the Administrator of the Bureau does 
not so conclude, he will submit the matter to the Secretary. If the 
Secretary concludes that the alternative provisions satisfy the criteria 
in section 6012, the State agency will be so notified. If the Secretary 
concludes that there is a question as to whether the alternative 
provisions satisfy the criteria, the State agency will be advised that 
unless the State law provisions are appropriately revised, a notice of 
hearing will be issued as required by the Code of Federal Regulations, 
title 20,Sec. 601.5.

[51 FR 45848, Dec. 22, 1986. Redesignated at 59 FR 943, Jan. 6, 1994]



    Sec. Appendix C to Part 617--Standard for Fraud and Overpayment 
                                Detection

    7510 Federal Law Requirements. Section 303(a)(1) of the Social 
Security Act requires that a State law include provision for:
    ``Such methods of administration . . . as are found by the Secretary 
to be reasonably calculated to insure full payment of unemployment 
compensation when due.''

[[Page 151]]

    Section 1603(a)(4) of the Internal Revenue Code and section 
3030(a)(5) of the Social Security Act require that a State law include 
provision for:
    ``Expenditure of all money withdrawn from an unemployment fund of 
such State, in the payment of unemployment compensation . . .''
    Section 1607(h) of the Internal Revenue Code defines 
``compensation'' as ``cash benefits payable to individuals with respect 
to their unemployment.''
    7511 The Secretary's Interpretation of Federal Law Requirements. The 
Secretary of Labor interprets the above sections to require that a State 
law include provision for such methods of administration as are, within 
reason, calculated (1) to detect benefits paid through error by the 
agency or through willful misrepresentation or error by the claimant or 
others, and (2) to deter claimants from obtaining benefits through 
willful misrepresentation.
    7513 Criteria for Review of State Conformity With Federal 
Requirements. In determining State conformity with the above 
requirements of the Internal Revenue Code and the Social Security Act, 
as interpreted by the Secretary of Labor, the following criteria will be 
applied:
    A. Are investigations required to be made after the payment of 
benefits, (or, in the case of interstate claims, are investigations made 
by the agent State after the processing of claims) as to claimants' 
entitlement to benefits paid to them in a sufficient proportion of cases 
to test the effectiveness of the agency's procedures for the prevention 
of payments which are not due? To carry out investigations, has the 
agency assigned to some individual or unit, as a basic function, the 
responsibility of making or functionally directing such investigations?
    Explanation: It is not feasible to prescribe the extent to which the 
above activities are required; however, they should always be carried on 
to such an extent that they will show whether or not error or willful 
misrepresentation is increasing or decreasing, and will reveal problem 
areas. The extent and nature of the above activities should be varied 
according to the seriousness of the problem in the State. The 
responsible individual or unit should:
    1. Check paid claims for overpayment and investigate for willful 
misrepresentation or, alternatively, advise and assist the operating 
units in the performance of such functions, or both;
    2. Perform consultative services with respect to methods and 
procedures for the prevention and detection of fraud; and
    3. Perform other services which are closely related to the above.
    Although a State agency is expected to make a full-time assignment 
of responsibility to a unit or individual to carry on the functions 
described above, a small State agency might make these functions a part-
time responsibility of one individual. In connection with the detection 
of overpayments, such a unit or individual might, for example:
    (a) Investigate information on suspected benefit fraud received from 
any agency personnel, and from sources outside the agency, including 
anonymous complaints;
    (b) Investigate information secured from comparisons of benefit 
payments with employment records to detect cases of concurrent working 
(whether in covered or noncovered work) and claiming of benefits 
(including benefit payments in which the agency acted as agent for 
another State).
    The benefit fraud referred to herein may involve employers, agency 
employees, and witnesses, as well as claimants.
    Comparisons of benefit payments with employment records are comonly 
made either by post-audit or by industry surveys. The so-called ``post-
audit'' is a matching of central office wage-record files against 
benefit payments for the same period. ``Industry surveys'' or ``mass 
audits'' are done in some States by going directly to employers for pay-
roll information to be checked against concurrent benefit lists. A plan 
of investigation based on a sample post-audit will be considered as 
partial fulfillment of the investigation program; it would need to be 
supplemented by other methods capable of detecting overpayments to 
persons who have moved into noncovered occupations or are claiming 
interstate benefits.
    B. Are adequate records maintained by which the results of 
investigations may be evaluated?
    Explanation. To meet this criterion, the State agency will be 
expected to maintain records of all its activities in the detection of 
overpayments, showing whether attributable to error or willful 
misrepresentation, measuring the results obtained through various 
methods, and noting the remedial action taken in each case. The adequacy 
and effectiveness of various methods of checking for willful 
misrepresentation can be evaluated only if records are kept of the 
results obtained. Internal reports on fraudulent and erroneous 
overpayments are needed by State agencies for self-evaluation. Detailed 
records should be maintained in order that the State agency may 
determine, for example, which of several methods of checking currently 
used are the most productive. Such records also will provide the basis 
for drawing a clear distinction between fraud and error.
    C. Does the agency take adequate action with respect to publicity 
concerning willful misrepresentation and its legal consequences to deter 
fraud by claimants?
    Explanation. To meet this criterion, the State agency must issue 
adequate material of claimant eligibility requirements and must take 
necessary action to obtain publicity on the legal consequences of 
willful

[[Page 152]]

misrepresentation or willful nondisclosure of facts.
    Public announcements on convictions and resulting penalties for 
fraud are generally considered necessary as a deterrent to other 
persons, and to inform the public that the agency is carrying on an 
effective program to prevent fraud. This alone is not considered 
adequate publicity. It is important that information be circulated which 
will explain clearly and understandably the claimant's rights, and the 
obligations which he must fulfill to be eligible for benefits. Leaflets 
for distribution and posters placed in local offices are appropriate 
media for such information.
    *7515 Evaluation of Alternative State Provisions with Respect to 
Erroneous and Illegal Payments. If the methods of administration 
provided for by the State law do not conform to the suggested methods of 
meeting the requirements set forth in section 7511, but a State law does 
provide for alternative methods of administration designed to accomplish 
the same results, the Bureau of Employment Security, in collaboration 
with the State agency, will study the actual or anticipated effect of 
the alternative methods of administration. If the Bureau concludes that 
the alternative methods satisfy the criteria in section 7513, it will so 
notify the State agency. If the Bureau does not so conclude, it will 
submit to the Secretary the results of the study for his determination 
of whether the State's alternative methods of administration meet the 
criteria.

[51 FR 45848, Dec. 22, 1986. Redesignated at 59 FR 943, Jan. 6, 1994]



PART 618_TRADE ADJUSTMENT ASSISTANCE UNDER THE TRADE ACT OF 1974,
AS AMENDED--Table of Contents



Subpart A-G [Reserved]

          Subpart H_Administration by Applicable State Agencies

Sec.
618.890 Merit staffing.

            Subpart I_Allocation of Training Funds to States

618.900 Annual training cap.
618.910 Distribution of initial allocation of training funds.
618.920 Reserve fund distributions.
618.930 Second distribution.
618.940 Insufficient funds.

    Source: 75 FR 17000, Apr. 2, 2010, unless otherwise noted.

Subpart A-G [Reserved]



          Subpart H_Administration by Applicable State Agencies

    Authority: 19 U.S.C. 2320; Secretary's Order No. 03-2009, 74 FR 
2279, Jan. 14, 2009.



Sec.  618.890  Merit staffing.

    (a) Merit-based State personnel. The State must, subject to the 
transition period in paragraph (b) of this section, engage only State 
government personnel to perform Trade Adjustment Assistance (TAA)-funded 
functions undertaken to carry out the worker adjustment assistance 
provisions of the Trade Act of 1974, as amended, and must apply to such 
personnel the standards for a merit system of personnel administration 
applicable to personnel covered under 5 CFR part 900, subpart F.
    (b) Transition period. A State not already in compliance with the 
merit system requirement of paragraph (a) of this section must comply by 
December 15, 2010.
    (c) Exemptions for States with employment service operation 
exemptions. A State whose employment service received an exemption from 
merit staffing requirements from the Secretary of Labor (Secretary) 
under the Wagner-Peyser Act will retain an exemption from the 
requirements of paragraph (a) of this section. The exemption does not 
apply to the State's administration of trade readjustment allowances 
which remain subject to the requirements of paragraph (a) of this 
section. To the extent that a State with an authorized ES exemption 
provides TAA-funded services using staff not funded under the Wagner-
Peyser Act, the exemption in this paragraph does not apply, and they 
remain subject to the requirements of paragraph (a) of this section.
    (d) Exceptions for non-inherently governmental functions. The 
requirements of paragraph (a) of this section do not prohibit a State 
from outsourcing functions that are not inherently governmental, as 
defined in Office of Management and Budget (OMB) Circular No. A-76 
(Revised), in any supplemental OMB guidance or superseding authority, 
and in DOL guidance.

[[Page 153]]



            Subpart I_Allocation of Training Funds to States

    Authority: 19 U.S.C. 2320; 19 U.S.C. 2296(g); Secretary's Order No. 
03-2009, 74 FR 2279, Jan. 14, 2009.



Sec.  618.900  Annual training cap.

    The total amount of payments that may be made for the costs of 
training will not exceed the cap established under section 236(a)(2)(A) 
of the Trade Act.
    (a) For each of the fiscal years 2009 and 2010, this cap is 
$575,000,000; and
    (b) For the period beginning October 1, 2010, and ending December 
31, 2010, this cap is $143,750,000.



Sec.  618.910  Distribution of initial allocation of training funds.

    (a) Initial allocation. The initial allocation for a fiscal year 
will total 65 percent of the training funds available for that fiscal 
year. The Department of Labor (Department) will announce the amount of 
each State's initial allocation of funds in accordance with the 
requirements of this section at the beginning of each fiscal year. The 
Department will determine this initial allocation on the basis of the 
full amount of the training cap for that year, even if the full amount 
has not been appropriated to the Department at that time.
    (b) Timing of the distribution of the initial allocation. The 
Department will, as soon as practical after the beginning of each fiscal 
year, distribute the initial allocation announced under paragraph (a) of 
this section. However, the Department will not distribute the full 
amount of the initial allocation until it receives the entire fiscal 
year's appropriation of training funds. If the full year's appropriated 
amount of training funds is less than the training cap, then the 
Department will distribute 65 percent of the amount appropriated.
    (c) Hold harmless provision. Except as provided in paragraph (d) of 
this section, in no case will the amount of the initial allocation to a 
State in a fiscal year be less than 25 percent of the initial allocation 
to that State in the preceding fiscal year.
    (d) Minimum initial allocation. If a State has an adjusted initial 
allocation of less than $100,000, as calculated in accordance with 
paragraph (e)(2) of this section, that State will not receive any 
initial allocation, and the funds that otherwise would have been 
allocated to that State instead will be allocated among the other States 
in accordance with this section. A State that does not receive an 
initial distribution may apply underSec. 618.920(b) for reserve funds 
to obtain the training funding that it requires.
    (e) Process of determining initial allocation. (1) The Department 
will first apply the factors described in paragraph (f) of this section 
to determine an unadjusted initial allocation for each State.
    (2) The Department will then apply the hold harmless provision of 
paragraph (c) of this section to the unadjusted initial allocation, as 
follows:
    (i) A State whose unadjusted initial allocation is less than its 
hold harmless amount but is $100,000 or more, will have its initial 
allocation adjusted up to its hold harmless amount. If a State's 
unadjusted allocation is less than $100,000, the State will receive no 
initial allocation, in accordance with paragraph (d) of this section. 
Those funds will be shared among other States as provided in paragraph 
(e)(3) of this section.
    (ii) A State whose unadjusted initial allocation is no less than its 
hold harmless threshold will receive its hold harmless amount and will 
also receive an adjustment equal to the State's share of the remaining 
initial allocation funds, as provided in paragraph (e)(3) of this 
section.
    (3) The initial allocation funds remaining after the adjusted 
initial allocations are made to those States receiving only their hold 
harmless amounts, as described in paragraph (e)(2)(i) of this section, 
will be distributed among the States with unadjusted initial allocations 
that were no less than their hold harmless amounts, as described in 
paragraph (e)(2)(ii) of this section (the remaining States). The 
distribution of the remaining initial allocation funds among the 
remaining States will be made by reapplying the calculation in paragraph 
(f) of this section. This recalculation will disregard

[[Page 154]]

States receiving only their hold harmless amount under paragraph 
(e)(2)(i) of this section, so that the combined percentages of the 
remaining States total 100 percent.
    (f) Initial allocation factors. (1) In determining how to make the 
initial allocation of training funds, the Department will apply, as 
provided in paragraph (f)(3) of this section, the following factors with 
respect to each State:
    (i) The trend in the number of workers covered by certifications of 
eligibility during the most recent four consecutive calendar quarters 
for which data are available. The trend will be established by assigning 
a greater weight to the most recent quarters, giving those quarters a 
larger share of the factor;
    (ii) The trend in the number of workers participating in training 
during the most recent four consecutive calendar quarters for which data 
are available. The trend will be established by assigning a greater 
weight to the most recent quarters, giving those quarters a larger share 
of the factor;
    (iii) The number of workers estimated to be participating in 
training during the fiscal year. The estimate will be calculated by 
dividing the weighted average number of training participants for the 
State determined in paragraph (f)(1)(ii) of this section by the sum of 
the weighted averages for all States and multiplying the resulting ratio 
by the projected national average of training participants for the 
fiscal year, using the estimates underlying the Department's most recent 
budget submission or update; and
    (iv) The amount of funding estimated to be necessary to provide 
approved training to such workers during the fiscal year. The estimate 
will be calculated by multiplying the estimated number of participants 
in paragraph (f)(1)(iii) of this section by the average training cost 
for the State. The average training cost will be calculated by dividing 
total training expenditures for the most recent four quarters by the 
average number of training participants for the same time period.
    (2) The Department may use such other factors that it considers 
appropriate.
    (3) The Department will assign each of the factors listed in 
paragraphs (f)(1)(i) through (f)(1)(iv) of this section an equal weight. 
For each of these weighted factors, the Department will determine the 
national total and each State's percentage of the national total. Based 
on a State's percentage of each of these weighted factors, the 
Department will determine the percentage that the State will receive of 
the amount available for initial allocations. The percentages of initial 
allocation amounts calculated for all States combined will total 100 
percent of initial allocation funds.
    (4) The Department may, by administrative guidance published for 
comment, change the weights provided in paragraphs (f)(1) and (f)(3) of 
this section, or add additional factors. No such changes or additions 
will take effect before December 31, 2010.



Sec.  618.920  Reserve fund distributions.

    (a) The remaining 35 percent of the training funds for a fiscal year 
will be held by the Department as a reserve. Reserve funds will be used, 
as needed, for additional distributions during the remainder of the 
fiscal year and for those States that do not receive an initial 
distribution. States may not receive reserve funds for TAA 
administration or employment and case management services without a 
request for training funds.
    (b) A State requesting reserve funds must demonstrate that at least 
50 percent of its training funds have been expended, or that it needs 
more funds to meet unusual and unexpected events. A State requesting 
reserve funds also must provide a documented estimate of expected 
funding needs through the end of the fiscal year. That estimate must be 
based on an analysis that includes at least the following:
    (1) The average cost of training in the State;
    (2) The expected number of participants in training through the end 
of the fiscal year; and
    (3) The remaining funds the State has available for training.



Sec.  618.930  Second distribution.

    The Department will distribute at least 90 percent of the total 
training

[[Page 155]]

funds for a fiscal year to the States no later than July 15 of that 
fiscal year. The Department will first fund all acceptable requests for 
reserve funds filed before June 1. If there are any funds remaining to 
be distributed after these reserve fund requests are satisfied, those 
funds will be distributed to those States that received an initial 
allocation in an amount greater than their hold harmless amount, using 
the methodology described inSec. 618.910.



Sec.  618.940  Insufficient funds.

    If, during a fiscal year, the Department estimates that the amount 
of funds necessary to pay the costs of approved training will exceed the 
training cap underSec. 618.900, the Department will decide how the 
amount of available training funds that have not been distributed at the 
time of the estimate will be allocated among the States for the 
remainder of the fiscal year. That decision will be communicated through 
administrative notice.

                        PARTS 619	621 [RESERVED]



PART 625_DISASTER UNEMPLOYMENT ASSISTANCE--Table of Contents



Sec.
625.1 Purpose; rules of construction.
625.2 Definitions.
625.3 Reemployment assistance.
625.4 Eligibility requirements for Disaster Unemployment Assistance.
625.5 Unemployment caused by a major disaster.
625.6 Weekly amount; jurisdictions; reductions.
625.7 Disaster Unemployment Assistance: Duration.
625.8 Applications for Disaster Unemployment Assistance.
625.9 Determinations of entitlement; notices to individual.
625.10 Appeal and review.
625.11 Provisions of State law applicable.
625.12 The applicable State for an individual.
625.13 Restrictions on entitlement; disqualification.
625.14 Overpayments; disqualification for fraud.
625.15 Inviolate rights to DUA.
625.16 Recordkeeping; disclosure of information.
625.17 Announcement of the beginning of a Disaster Assistance Period.
625.18 Public access to Agreements.
625.19 Information, reports and studies.
625.20 [Reserved]
625.30 Appeal Procedures for Guam, American Samoa, Commonwealth of the 
          Northern Mariana Islands, Federated States of Micronesia, 
          Republic of the Marshall Islands, and the Trust Territory of 
          the Pacific Islands.

Appendix A to Part 625--Standard for Claim Filing, Claimant Reporting, 
          Job Finding, and Employment Services
Appendix B to Part 625--Standard for Claim Determinations--Separation 
          Information
Appendix C to Part 625--Standard for Fraud and Overpayment Detection

    Authority: 42 U.S.C. 1302; 42 U.S.C. 5164; 42 U.S.C. 5189a(c); 42 
U.S.C. 5201(a); Executive Order 12673 of March 23, 1989 (54 FR 12571); 
delegation of authority from the Director of the Federal Emergency 
Management Agency to the Secretary of Labor, effective December 1, 1985 
(51 FR 4988); Secretary's Order No. 4-75 (40 FR 18515).

    Source: 42 FR 46712, Sept. 16, 1977, unless otherwise noted.



Sec.  625.1  Purpose; rules of construction.

    (a) Purpose. Section 410 of ``The Robert T. Stafford Disaster Relief 
and Emergency Assistance Act'' amended the program for the payment of 
unemployment assistance to unemployed individuals whose unemployment is 
caused by a major disaster, and to provide reemployment assistance 
services to those individuals. The unemployment assistance provided for 
in section 410 of the Act is hereinafter referred to as Disaster 
Unemployment Assistance, or DUA. The regulations in this part are issued 
to implement sections 410 and 423 of the Act.
    (b) First rule of construction. Sections 410 and 423 of the Act and 
the implementing regulations in this part shall be construed liberally 
so as to carry out the purposes of the Act.
    (c) Second rule of construction. Sections 410 and 423 of the Act and 
the implementing regulations in this part shall be construed so as to 
assure insofar as possible the uniform interpretation and application of 
the Act throughout the United States.
    (d) Effectuating purpose and rules of construction. (1) In order to 
effectuate the provisions of this section, each State agency shall 
forward to the United States Department of Labor, on

[[Page 156]]

receipt of a request from the Department, a copy of any determination or 
redetermination ruling on an individual's entitlement to DUA.
    (2) If the Department believes a determination or redetermination is 
inconsistent with the Secretary's interpretation of the Act, the 
Department may at any time notify the State agency of the department's 
view. Thereafter, the State agency shall appeal if possible, and shall 
not follow such determination or redetermination as a precedent; and in 
any subsequent proceedings which involve such determination or 
redetermination, or wherein such determination or redetermination is 
cited as precedent or otherwise relied upon, the State agency shall 
inform the hearing officer of the Department's view and shall make all 
reasonable efforts to obtain modification, limitation, or overruling of 
the determination or redetermination.
    (3) A State agency may request reconsideration of a notice that a 
determination or redetermination is inconsistent with the Act, and shall 
be given an opportunity to present views and arguments if desired. If a 
determination or redetermination setting a precedent becomes final, 
which the Department believes to be inconsistent with the Act, the 
Secretary will decide whether the Agreement with the State shall be 
terminated.
    (4) Concurrence of the Department in a determination or 
redetermination shall not be presumed from the absence of a notice 
issued pursuant to this paragraph.

[42 FR 46712, Sept. 16, 1977, as amended at 55 FR 554, Jan. 5, 1990]



Sec.  625.2  Definitions.

    For the purposes of the Act and this part:
    (a) Act means sections 410 and 423 of The Robert T. Stafford 
Disaster Relief and Emergency Assistance Act (formerly section 407 of 
the ``Disaster Relief Act of 1974'', Pub. L. 93-288, 88 Stat. 143, 156, 
approved May 22, 1974), 42 U.S.C. 5177, 5189a, as amended by The 
Disaster Relief and Emergency Assistance Amendments of 1988, Pub. L. 
100-707, 102 Stat. 4689, 4704, 4705, approved November 23, 1988.
    (b) Agreement means the Agreement entered into pursuant to the Act, 
between a State and the Secretary of Labor of the United States, under 
which the State agency of the State agrees to make payments of Disaster 
Unemployment Assistance in accordance with the Act and the regulations 
and procedures thereunder prescribed by the Secretary.
    (c) Announcement date means the first day on which the State agency 
publicly announces the availability of Disaster Unemployment Assistance 
in the State, pursuant toSec. 625.17.
    (d) Compensation means unemployment compensation as defined in 
section 85(b) of the Internal Revenue Code of 1986, and shall include 
any assistance or allowance payable to an individual with respect to 
such individual's unemployment under any State law or Federal 
unemployment compensation law unless such governmental unemployment 
compensation program payments are not considered ``compensation'' by 
ruling of the Internal Revenue Service or specific provision of Federal 
and/or State law because such payments are based on employee 
contributions which are not deductible from Federal income tax liability 
until the total nondeductible contributions paid by the employee to such 
program has been paid or are not ``compensation'' as defined under 
paragraph (d)(5) of this section. Governmental unemployment compensation 
programs include (but are not limited to) programs established under: a 
State law approved by the Secretary of Labor pursuant to section 3304 of 
the Internal Revenue Code, chapter 85 of title 5 of the United States 
Code, the Railroad Unemployment Insurance Act (45 U.S.C. 351 et seq.), 
any Federal supplementary compensation law, and trade readjustment 
allowances payable under chapter 2 of title II of the Trade Act of 1974 
(19 U.S.C. 2271 et seq.). ``Compensation'' also includes ``regular 
compensation'', ``additional compensation'', ``extended compensation'', 
``Federal supplementary compensation'', and ``disability payments'' 
defined as follows:
    (1) Regular compensation means compensation payable to an individual 
under any State law or the unemployment compensation plan of a political

[[Page 157]]

subdivision of a State and, when so payable, includes compensation 
payable pursuant to 5 U.S.C. chapter 85 (parts 609 and 614 of this 
chapter), but not including extended compensation or additional 
compensation.
    (2) Additional compensation means compensation totally financed by a 
State and payable under a State law by reason of conditions of high 
unemployment or by reason of other special factors, and, when so 
payable, includes compensation payable pursuant to 5 U.S.C. chapter 85.
    (3) Extended compensation means compensation payable to an 
individual for weeks of unemployment in an extended benefit period, 
under those provisions of a State law which satisfy the requirements of 
the Federal-State Extended Unemployment Compensation Act of 1970 (title 
II, Pub. L. 91-373; 84 Stat. 695, 708; part 615 of this chapter), as 
amended with respect to the payment of extended compensation, and, when 
so payable, includes additional compensation and compensation payable 
pursuant to 5 U.S.C. chapter 85.
    (4) Federal supplementary compensation means supplemental 
compensation payable under a temporary Federal law after exhaustion of 
regular and extended compensation.
    (5) Disability payments means cash disability payments made pursuant 
to a governmental program as a substitute for cash unemployment payments 
to an individual who is ineligible for such payments solely because of 
the disability, except for payments made under workmen's compensation 
acts for personal injuries or sickness.
    (e) Date the major disaster began means the date a major disaster 
first occurred, as specified in the understanding between the Federal 
Emergency Management Agency and the Governor of the State in which the 
major disaster occurred.
    (f) Disaster Assistance Period means the period beginning with the 
first week following the date the major disaster began, and ending with 
the 26th week subsequent to the date the major disaster was declared.
    (g) Disaster Unemployment Assistance means the assistance payable to 
an individual eligible for the assistance under the Act and this part, 
and which is referred to as DUA.
    (h) Federal Coordinating Officer means the official appointed 
pursuant to section 302 of The Robert T. Stafford Disaster Relief and 
Emergency Assistance Act, to operate in the affected major disaster 
area.
    (i) Governor means the chief executive of a State.
    (j) Initial application means the first application for DUA filed by 
an individual, on the basis of which the individual's eligibility for 
DUA is determined.
    (k) Major disaster means a major disaster as declared by the 
President pursuant to section 401 of The Robert T. Stafford Disaster 
Relief and Emergency Assistance Act.
    (l) Major disaster area means the area identified as eligible for 
Federal assistance by the Federal Emergency Management Agency, pursuant 
to a Presidential declaration of a major disaster.
    (m) Secretary means the Secretary of Labor of the United States.
    (n) Self-employed individual means an individual whose primary 
reliance for income is on the performance of services in the 
individual's own business, or on the individual's own farm.
    (o) Self-employment means services performed as a self-employed 
individual.
    (p) State means any State of the United States, the District of 
Columbia, the Commonwealth of Puerto Rico, the United States Virgin 
Islands, the Territory of Guam, American Samoa, Commonwealth of the 
Northern Mariana Islands, Federated States of Micronesia, Republic of 
the Marshall Islands, and the Trust Territory of the Pacific Islands.
    (q) State agency means--
    (1) In all States except the Territory of Guam, American Samoa, 
Commonwealth of the Northern Mariana Islands, Federated States of 
Micronesia, Republic of the Marshall Islands and the Trust Territory of 
the Pacific Islands, the agency administering the State law; and
    (2) In the Territory of Guam, American Samoa, Commonwealth of the 
Northern Mariana Islands, Federated States of Micronesia, Republic of 
the

[[Page 158]]

Marshall Islands and the Trust Territory of the Pacific Islands, the 
agency designated in the Agreement entered into by the State.
    (r)(1) State law means, with respect to--
    (i) The States of the United States, the District of Columbia, the 
Commonwealth of Puerto Rico, and the Virgin Islands, the unemployment 
compensation law of the State which has been approved under section 
3304(a) of the Internal Revenue Code of 1986 (26 U.S.C. 3304(a)); and
    (ii) The Territory of Guam, American Samoa, Commonwealth of the 
Northern Mariana Islands, Federated States of Micronesia, Republic of 
the Marshall Islands and the Trust Territory of the Pacific Islands, the 
Hawaii Employment Security Law.
    (2) Applicable State law means, for an individual, the State law of 
the applicable State for an individual as provided inSec. 625.12.
    (s) Unemployed worker means an individual who was employed in or was 
to commence employment in the major disaster area at the time the major 
disaster began, and whose principal source of income and livelihood is 
dependent upon the individual's employment for wages, and whose 
unemployment is caused by a major disaster as provided inSec. 
625.5(a).
    (t) Unemployed self-employed individual means an individual who was 
self-employed in or was to commence self-employment in the major 
disaster area at the time the major disaster began, and whose principal 
source of income and livelihood is dependent upon the individual's 
performance of service in self-employment, and whose unemployment is 
caused by a major disaster as provided inSec. 625.5(b).
    (u) Wages means remuneration for services performed for another, 
and, with respect to a self-employed individual, net income from 
services performed in self-employment.
    (v) Week means a week as defined in the applicable State law.
    (w) Week of unemployment means--
    (1) For an unemployed worker, any week during which the individual 
is totally, part-totally, or partially unemployed. A week of total 
unemployment is a week during which the individual performs no work and 
earns no wages, or has less than full-time work and earns wages not 
exceeding the minimum earnings allowance prescribed in the applicable 
State law. A week of part-total unemployment is a week of otherwise 
total unemployment during which the individual has odd jobs or 
subsidiary work and earns wages not exceeding the maximum earnings 
allowance prescribed in the applicable State law. A week of partial 
unemployment is a week during which the individual works less than 
regular, full-time hours for the individual's regular employer, as a 
direct result of the major disaster, and earns wages not exceeding the 
maximum earnings allowance prescribed by the applicable State law.
    (2) For an unemployed self-employed individual, any week during 
which the individual is totally, part-totally, or partially unemployed. 
A week of total unemployment is a week during which the individual 
performs no services in self-employment or in an employer-employee 
relationship, or performs services less than full-time and earns wages 
not exceeding the minimum earnings allowance prescribed in the 
applicable State law. A week of part-total unemployment is a week of 
otherwise total unemployment during which the individual has odd jobs or 
subsidiary work and earns wages not exceeding the maximum earnings 
allowance prescribed in the applicable State law. A week of partial 
unemployment is a week during which the individual performs less than 
the customary full-time services in self-employment, as a direct result 
of the major disaster, and earns wages not exceeding the maximum 
earnings allowance prescribed by the applicable State law, or during 
which the only activities or services performed are for the sole purpose 
of enabling the individual to resume self-employment.
    (3) If the week of unemployment for which an individual claims DUA 
is a week with respect to which the individual is reemployed in a 
suitable position or has commenced services in self-employment, that 
week shall be treated as a week of partial unemployment

[[Page 159]]

if the week qualifies as a week of partial unemployment as defined in 
this paragraph.

[42 FR 46712, Sept. 16, 1977, as amended at 55 FR 554, Jan. 5, 1990; 56 
FR 22805, May 16, 1991]



Sec.  625.3  Reemployment assistance.

    (a) State assistance. Except as provided in paragraph (b) of this 
section, the applicable State shall provide, without reimbursement from 
any funds provided under the Act, reemployment assistance services under 
any other law administered by the State to individuals applying for DUA 
and all other individuals who are unemployed because of a major 
disaster. Such services shall include, but are not limited to, 
counseling, referrals to suitable work opportunities, and suitable 
training, to assist the individuals in obtaining reemployment in 
suitable positions as soon as possible.
    (b) Federal assistance. In the case of American Samoa, Commonwealth 
of the Northern Mariana Islands, Federated States of Micronesia, 
Republic of the Marshall Islands, and the Trust Territory of the Pacific 
Islands, the Department of Labor, in consultation with the Federal 
Emergency Management Agency, will determine what reemployment services 
are needed by DUA applicants, and if any available Federal programs of 
reemployment assistance services can be implemented in that 
jurisdiction.

[55 FR 554, Jan. 5, 1990; as amended at 56 FR 22806, May 16, 1991]



Sec.  625.4  Eligibility requirements for Disaster Unemployment 
Assistance.

    An individual shall be eligible to receive a payment of DUA with 
respect to a week of unemployment, in accordance with the provisions of 
the Act and this part if:
    (a) That week begins during a Disaster Assistance Period;
    (b) The applicable State for the individual has entered into an 
Agreement which is in effect with respect to that week;
    (c) The individual is an unemployed worker or an unemployed self-
employed individual;
    (d) The individual's unemployment with respect to that week is 
caused by a major disaster, as provided inSec. 625.5;
    (e) The individual has filed a timely initial application for DUA 
and, as appropriate, a timely application for a payment of DUA with 
respect to that week;
    (f) That week is a week of unemployment for the individual;
    (g) The individual is able to work and available for work within the 
meaning of the applicable State law: Provided, That an individual shall 
be deemed to meet this requirement if any injury caused by the major 
disaster is the reason for inability to work or engage in self-
employment; or, in the case of an unemployed self-employed individual, 
the individual performs service or activities which are solely for the 
purpose of enabling the individual to resume self-employment;
    (h) The individual has not refused a bona fide offer of employment 
in a suitable position, or refused without good cause to resume or 
commence suitable self-employment, if the employment or self-employment 
could have been undertaken in that week or in any prior week in the 
Disaster Assistance Period; and
    (i) The individual is not eligible for compensation (as defined in 
Sec.  625.2(d)) or for waiting period credit for such week under any 
other Federal or State law, except that an individual determined 
ineligible because of the receipt of disqualifying income shall be 
considered eligible for such compensation or waiting period credit. An 
individual shall be considered ineligible for compensation or waiting 
period credit (and thus potentially eligible for DUA) if the individual 
is under a disqualification for a cause that occurred prior to the 
individual's unemployment due to the disaster, or for any other reason 
is ineligible for compensation or waiting period credit as a direct 
result of the major disaster.

[42 FR 46712, Sept. 16, 1977, as amended at 55 FR 555, Jan. 5, 1990]



Sec.  625.5  Unemployment caused by a major disaster.

    (a) Unemployed worker. The unemployment of an unemployed worker is 
caused by a major disaster if--

[[Page 160]]

    (1) The individual has a ``week of unemployment'' as defined in 
Sec.  625.2(w)(1) following the ``date the major disaster began'' as 
defined inSec. 625.2(e), and such unemployment is a direct result of 
the major disaster; or
    (2) The individual is unable to reach the place of employment as a 
direct result of the major disaster; or
    (3) The individual was to commence employment and does not have a 
job or is unable to reach the job as a direct result of the major 
disaster; or
    (4) The individual has become the breadwinner or major support for a 
household because the head of the household has died as a direct result 
of the major disaster; or
    (5) The individual cannot work because of an injury caused as a 
direct result of the major disaster.
    (b) Unemployed self-employed individual. The unemployment of an 
unemployed self-employed individual is caused by a major disaster if--
    (1) The individual has a ``week of unemployment'' as defined in 
Sec.  625.2(w)(2) following the ``date the major disaster began'' as 
defined inSec. 625.2(e), and such unemployment is a direct result of 
the major disaster; or
    (2) The individual is unable to reach the place where services as a 
self-employed individual are performed, as a direct result of the major 
disaster; or
    (3) The individual was to commence regular services as a self-
employed individual, but does not have a place or is unable to reach the 
place where the services as a self-employed individual were to be 
performed, as a direct result of the major disaster; or
    (4) The individual cannot perform services as a self-employed 
individual because of an injury caused as a direct result of the major 
disaster.
    (c) Unemployment is a direct result of the major disaster. For the 
purposes of paragraphs (a)(1) and (b)(1) of this section, a worker's or 
self-employed individual's unemployment is a direct result of the major 
disaster where the unemployment is an immediate result of the major 
disaster itself, and not the result of a longer chain of events 
precipitated or exacerbated by the disaster. Such an individual's 
unemployment is a direct result of the major disaster if the 
unemployment resulted from:
    (1) The physical damage or destruction of the place of employment;
    (2) The physical inaccessibility of the place of employment in the 
major disaster area due to its closure by or at the request of the 
federal, state or local government, in immediate response to the 
disaster; or
    (3) Lack of work, or loss of revenues, provided that, prior to the 
disaster, the employer, or the business in the case of a self-employed 
individual, received at least a majority of its revenue or income from 
an entity in the major disaster area that was either damaged or 
destroyed in the disaster, or an entity in the major disaster area 
closed by the federal, state or local government in immediate response 
to the disaster.

[42 FR 46712, Sept. 16, 1977, as amended at 55 FR 555, Jan. 5, 1990; 56 
FR 22806, May 16, 1991; 66 FR 56962, Nov. 13, 2001; 68 FR 10937, Mar. 6, 
2003]



Sec.  625.6  Weekly amount; jurisdictions; reductions.

    (a) In all States, except as provided in paragraphs (c) and (d) of 
this section, the amount of DUA payable to an unemployed worker or 
unemployed self-employed individual for a week of total unemployment 
shall be the weekly amount of compensation the individual would have 
been paid as regular compensation, as computed under the provisions of 
the applicable State law for a week of total unemployment. In no event 
shall such amount be in excess of the maximum amount of regular 
compensation authorized under the applicable State law for that week.
    (1) Except as provided in paragraph (a)(2) or (b) of this section, 
in computing an individual's weekly amount of DUA, qualifying employment 
and wage requirements and benefit formula of the applicable State law 
shall be applied; and for purposes of this section, employment, wages, 
and self-employment which are not covered by the applicable State law 
shall be treated in the same manner and with the same effect as covered 
employment and wages, but shall not include employment or self-
employment, or wages earned or

[[Page 161]]

paid for employment or self-employment, which is contrary to or 
prohibited by any Federal law, such as, but not limited to, section 
3304(a)(14)(A) of the Federal Unemployment Tax Act (26 U.S.C. 
3304(a)(14)(A)).
    (2) For purposes of paragraph (a)(1) of this section, the base 
period to be utilized in computing the DUA weekly amount shall be the 
most recent tax year that has ended for the individual (whether an 
employee or self-employed) prior to the individual's unemployment that 
was a direct result of the major disaster. The self-employment income to 
be treated as wages for purposes of computing the weekly amount under 
this paragraph (a) shall be the net income reported on the tax return of 
the individual as income from all self-employment that was dependent 
upon the performance of services by the individual. If an individual has 
not filed a tax return for the most recent tax year that has ended at 
the time of such individual's initial application for DUA, such 
individual shall have a weekly amount determined in accordance with 
paragraph (e)(3) of this section.
    (3) As of the date of filing an initial application for DUA, family 
members over the age of majority, as defined under the statutes of the 
applicable State, who were customarily or routinely employed or self-
employed as a family unit or in the same self-employment business prior 
to the individuals' unemployment that was a direct result of the major 
disaster, shall have the wages from such employment or net income from 
the self-employment allocated equally among such adult family members 
for purposes of computing a weekly amount under this paragraph (a), 
unless the documentation to substantiate employment or self-employment 
and wages earned or paid for such employment or self-employment 
submitted as required by paragraph (e) of this section supports a 
different allocation. Family members under the age of majority as of the 
date of filing an initial application for DUA shall have a weekly amount 
computed under this paragraph (a) based on the actual wages earned or 
paid for employment or self-employment rather than an equal allocation.
    (b) If the weekly amount computed under paragraph (a) of this 
section is less than 50 percent of the average weekly payment of regular 
compensation in the State, as provided quarterly by the Department, or, 
if the individual has insufficient wages from employment or insufficient 
or no net income from self-employment (which includes individuals 
falling within paragraphs (a)(3) and (b)(3) ofSec. 625.5) in the 
applicable base period to compute a weekly amount under paragraph (a) of 
this section, the individual shall be determined entitled to a weekly 
amount equal to 50 percent of the average weekly payment of regular 
compensation in the State.
    (1) If an individual was customarily or routinely employed or self-
employed less than full-time prior to the individual's unemployment as a 
direct result of the major disaster, such individual's weekly amount 
under this paragraph (b)(1) shall be determined by calculating the 
percent of time the individual was employed or self-employed compared to 
the customary and usual hours per week that would constitute the average 
per week hours for year-round full-time employment or self-employment 
for the occupation, then applying the percentage to the determined 50 
percent of the average weekly amount of regular compensation paid in the 
State. The State agency shall utilize information furnished by the 
applicant at the time of filing an initial application for DUA and any 
labor market or occupational information available within the State 
agency to determine the average per week hours for full-time employment 
or self-employment for the occupation. If the weekly amount computed for 
an individual under this paragraph (b)(1) is less than the weekly amount 
computed under paragraph (a) of this section for the individual, the 
individual shall be entitled to the higher weekly amount.
    (2) The weekly amount so determined under paragraph (b)(1) of this 
section, if not an even dollar amount, shall be rounded in accordance 
with the applicable State law.

[[Page 162]]

    (c) In the Territory of Guam and the Commonwealth of the Northern 
Mariana Islands, the amount of DUA payable to an unemployed worker or 
unemployed self-employed individual for a week of total unemployment 
shall be the average of the payments of regular compensation made under 
all State laws referred to inSec. 625.2(r)(1)(i) for weeks of total 
unemployment in the first four of the last five completed calendar 
quarters immediately preceding the quarter in which the major disaster 
began. The weekly amount so determined, if not an even dollar amount, 
shall be rounded to the next higher dollar.
    (d) In American Samoa, Federated States of Micronesia, Republic of 
the Marshall Islands and the Trust Territory of the Pacific Islands, the 
amount of DUA payable to an unemployed worker or unemployed self-
employed individual for a week of total unemployment shall be the amount 
agreed upon by the Regional Administrator, Employment and Training 
Administration, for Region VI (San Francisco), and the Federal 
Coordinating Officer, which shall approximate 50 percent of the area-
wide average of the weekly wages paid to individuals in the major 
disaster area in the quarter immediately preceding the quarter in which 
the major disaster began. The weekly amount so determined, if not an 
even dollar amount, shall be rounded to the next higher dollar.
    (e) The State agency shall immediately determine, upon the filing of 
an initial application for DUA, a weekly amount under the provisions of 
paragraphs (a) through (d) of this section, as the case may be, based on 
the individual's statement of employment or self-employment preceding 
the individual's unemployment that was a direct result of the major 
disaster, and wages earned or paid for such employment or self-
employment. An immediate determination of a weekly amount shall also be 
made where, in conjunction with the filing of an initial application for 
DUA, the individual submits documentation substantiating employment or 
self-employment and wages earned or paid for such employment or self-
employment, or, in the absence of documentation, where any State agency 
records of employment or self-employment and wages earned or paid for 
such employment or self-employment, justify the determination of a 
weekly amount. An immediate determination shall also be made based on 
the individual's statement or in conjunction with the submittal of 
documentation in those cases where the individual was to commence 
employment or self-employment on or after the date the major disaster 
began but was prevented from doing so as a direct result of the 
disaster.
    (1) In the case of a weekly amount determined in accordance with 
paragraph (e) of this section, based only on the individual's statement 
of earnings, the individual shall furnish documentation to substantiate 
the employment or self-employment or wages earned from or paid for such 
employment or self-employment or documentation to support that the 
individual was to commence employment or self-employment on or after the 
date the major disaster began. In either case, documentation shall be 
submitted within 21 calendar days of the filing of the initial 
application for DUA.
    (2) Any individual who fails to submit documentation to substantiate 
employment or self-employment or the planned commencement of employment 
or self-employment in accordance with paragraph (e)(1) of this section, 
shall be determined ineligible for the payment of DUA for any week of 
unemployment due to the disaster. Any weeks for which DUA was already 
paid on the application prior to the date of the determination of 
ineligibility under this paragraph (e)(2) are overpaid and a 
determination shall be issued in accordance withSec. 625.14(a). In 
addition, the State agency shall consider whether the individual is 
subject to a disqualification for fraud in accordance with the 
provisions set forth inSec. 625.14(i).
    (3) For purposes of a computation of a weekly amount under paragraph 
(a) of this section, if an individual submits documentation to 
substantiate employment or self-employment in accordance with paragraph 
(e)(1), but not documentation of wages earned or paid during the base 
period set forth in paragraph (a)(2) of this section, including those 
cases where the individual has

[[Page 163]]

not filed a tax return for the most recent tax year that has ended, the 
State agency shall immediately redetermine the weekly amount of DUA 
payable to the individual in accordance with paragraph (b) of this 
section.
    (4) Any individual determined eligible for a weekly amount of DUA 
under the provisions of paragraph (e)(3) of this section may submit 
necessary documentation to substantiate wages earned or paid during the 
base period set forth in paragraph (a)(2) of this section, including 
those cases where the individual has not filed a tax return for the most 
recent tax year that has ended, at any time prior to the end of the 
disaster assistance period. A redetermination of the weekly amount 
payable, as previously determined under paragraph (b) of this section, 
shall immediately be made if the wages earned or paid for services 
performed in employment or self-employment reflected in such 
documentation is sufficient to permit a computation under paragraph (a) 
of this section of a weekly amount higher than was determined under 
paragraph (b) of this section. Any higher amount so determined shall be 
applicable to all weeks during the disaster assistance period for which 
the individual was eligible for the payment of DUA.
    (f)(1) The weekly amount of DUA payable to an unemployed worker or 
unemployed self-employed individual for a week of partial or part-total 
unemployment shall be the weekly amount determined under paragraph (a), 
(b), (c) or (d) of this section, as the case may be, reduced (but not 
below zero) by the amount of wages that the individual earned in that 
week as determined by applying to such wages the earnings allowance for 
partial or part-total employment prescribed by the applicable State law.
    (2) The weekly amount of DUA payable to an unemployed self-employed 
individual for a week of unemployment shall be the weekly amount 
determined under paragraph (a), (b), (c) or (d) of this section, as the 
case may be, reduced (but not below zero) by the full amount of any 
income received during the week for the performance of services in self-
employment, regardless of whether or not any services were performed 
during the week, by applying the earnings allowance as set forth in 
paragraph (f)(1) of this section. Notwithstanding the definition of 
``wages'' for a self-employed individual underSec. 625.2(u), the term 
``any income'' for purposes of this paragraph (f)(2) means gross income.

[60 FR 25568, May 11, 1995, as amended at 71 FR 35516, June 21, 2006]



Sec.  625.7  Disaster Unemployment Assistance: Duration.

    DUA shall be payable to an eligible unemployed worker or eligible 
unemployed self-employed individual for all weeks of unemployment which 
begin during a Disaster Assistance Period.



Sec.  625.8  Applications for Disaster Unemployment Assistance.

    (a) Initial application. An initial application for DUA shall be 
filed by an individual with the State agency of the applicable State 
within 30 days after the announcement date of the major disaster as the 
result of which the individual became unemployed, and on a form 
prescribed by the Secretary which shall be furnished to the individual 
by the State agency. An initial application filed later than 30 days 
after the announcement date of the major disaster shall be accepted as 
timely by the State agency if the applicant had good cause for the late 
filing, but in no event shall an initial application be accepted by the 
State agency if it is filed after the expiration of the Disaster 
Assistance Period. If the 30th day falls on a Saturday, Sunday, or a 
legal holiday in the major disaster area, the 30-day time limit shall be 
extended to the next business day.
    (b) Weekly applications. Applications for DUA for weeks of 
unemployment shall be filed with respect to the individual's applicable 
State at the times and in the manner as claims for regular compensation 
are filed under the applicable State law, and on forms prescribed by the 
Secretary which shall be furnished to the individual by the State 
agency.
    (c) Filing in person. (1) Except as provided in paragraph (c)(2) of 
this section, all applications for DUA, including initial applications, 
shall be filed in person.

[[Page 164]]

    (2) Whenever an individual has good cause for not filing any 
application for DUA in person, the application shall be filed at such 
time, in such place, and in such a manner as directed by the State 
agency and in accordance with this part and procedures prescribed by the 
Secretary.
    (d) IBPP. The ``Interstate Benefit Payment Plan'' shall apply, where 
appropriate, to an individual filing applications for DUA.
    (e) Wage combining. The ``Interstate Arrangement for Combining 
Employment and Wages'' (part 616 of this chapter) shall apply, where 
appropriate, to an individual filing applications for DUA: Provided, 
That the ``Paying State'' shall be the applicable State for the 
individual as prescribed inSec. 625.12.
    (f) Procedural requirements. (1) The procedures for reporting and 
filing applications for DUA shall be consistent with this part, and with 
the Secretary's ``Standard for Claim Filing, Claimant Reporting, Job 
Finding and Employment Services,'' Employment Security Manual. Part V, 
sections 5000 et seq. (appendix A of this part), insofar as such 
standard is not inconsistent with this part.
    (2) The provisions of the applicable State law which apply hereunder 
to applications for and the payment of DUA shall be applied consistent 
with the requirements of title III of the Social Security Act and the 
Federal Unemployment Tax Act which are pertinent in the case of regular 
compensation, including but not limited to those standards and 
requirements specifically referred to in the provisions of this part.

(Approved by the Office of Management and Budget under control number 
1205-0051)

(Pub. L. No. 96-511)

[42 FR 46712, Sept. 16, 1977, as amended at 49 FR 18295, Apr. 30, 1984; 
55 FR 555, Jan. 5, 1990]



Sec.  625.9  Determinations of entitlement; notices to individual.

    (a) Determination of initial application. (1) The State agency shall 
promptly, upon the filing of an initial application for DUA, determine 
whether the individual is eligible, and if the individual is found to be 
eligible, the weekly amount of DUA payable to the individual and the 
period during which DUA is payable.
    (2) An individual's eligibility for DUA shall be determined, where a 
reliable record of employment, self-employment and wages is not 
obtainable, on the basis of an affidavit submitted to the State agency 
by the individual, and on a form prescribed by the Secretary which shall 
be furnished to the individual by the State agency.
    (b) Determinations of weekly applications. The State agency shall 
promptly, upon the filing of an application for a payment of DUA with 
respect to a week of unemployment, determine whether the individual is 
entitled to a payment of DUA with respect to that week, and, if 
entitled, the amount of DUA to which the individual is entitled.
    (c) Redetermination. The provisions of the applicable State law 
concerning the right to request, or authority to undertake, 
reconsideration of a determination pertaining to regular compensation 
under the applicable State law shall apply to determinations pertaining 
to DUA.
    (d) Notices to individual. The State agency shall give notice in 
writing to the individual, by the most expeditious method, of any 
determination or redetermination of an initial application, and of any 
determination of an application for DUA with respect to a week of 
unemployment which denies DUA or reduces the weekly amount initially 
determined to be payable, and of any redetermination of an application 
for DUA with respect to a week of unemployment. Each notice of 
determination or redetermination shall include such information 
regarding the determination or redetermination and notice of right to 
reconsideration or appeal, or both, as is furnished with written notices 
of determination and written notices of redeterminations with respect to 
claims for regular compensation.
    (e) Promptness. Full payment of DUA when due shall be made with the 
greatest promptness that is administratively feasible.
    (f) Secretary's Standard. The procedures for making determinations 
and

[[Page 165]]

redeterminations, and furnishing written notices of determinations, 
redeterminations, and rights of appeal to individuals applying for DUA, 
shall be consistent with this part and with the Secretary's ``Standard 
for Claim Determinations--Separation Information,'' Employment Security 
Manual. Part V, sections 6010 et seq. (Appendix B of this part).

(Approved by the Office of Management and Budget under control number 
1205-0051)

(Pub. L. No. 96-511)

[42 FR 46712, Sept. 16, 1977, as amended at 49 FR 18295, Apr. 30, 1984; 
55 FR 555, Jan. 5, 1990]



Sec.  625.10  Appeal and review.

    (a) States of the United States. (1) Any determination or 
redetermination made pursuant toSec. 625.9, by the State agency of a 
State (other than the State agency of the Territory of Guam, American 
Samoa, Commonwealth of the Northern Mariana Islands, Federated States of 
Micronesia, Republic of the Marshall Islands, or the Trust Territory of 
the Pacific Islands) may be appealed by the applicant in accordance with 
the applicable State law to the first-stage administrative appellate 
authority in the same manner and to the same extent as a determination 
or redetermination of a right to regular compensation may be appealed 
under the applicable State law, except that the period for appealing 
shall be 60 days from the date the determination or redetermination is 
issued or mailed instead of the appeal period provided for in the 
applicable State law. Any decision on a DUA first-stage appeal must be 
made and issued within 30 days after receipt of the appeal by the State.
    (2) Notice of the decision on appeal, and the reasons therefor, 
shall be given to the individual by delivering the notice to such 
individual personally or by mailing it to the individual's last known 
address, whichever is most expeditious. The decision shall contain 
information as to the individual's right to review of the decision by 
the appropriate Regional Administrator, Employment and Training 
Administration, if requested within 15 days after the decision was 
mailed or delivered in person to the individual. The notice will include 
the manner of requesting such review, and the complete address of the 
Regional Administrator. Notice of the decision on appeal shall be given 
also to the State agency (with the same notice of right to review) and 
to the appropriate Regional Administrator.
    (b) Guam, American Samoa, and the Trust Territory of the Pacific 
Islands. (1) In the case of an appeal by an individual from a 
determination or redetermination by the State agency of the Territory of 
Guam, American Samoa, Commonwealth of the Northern Mariana Islands, 
Federated States of Micronesia, Republic of the Marshall Islands, or the 
Trust Territory of the Pacific Islands, the individual shall be entitled 
to a hearing and decision in accordance withSec. 625.30 of this part.
    (2) Notice of the referee's decision, and the reasons therefor, 
shall be given to the individual by delivering the notice to the 
individual personally or by mailing it to the individual's last known 
address, whichever is most expeditious. The notice of decision shall 
contain information as to the individual's right to review of the 
decision by the Regional Administrator, Employment and Training 
Administration, for Region VI (San Francisco), and the manner of 
obtaining such review, including the address of the Regional 
Administrator. Notice of the decision on appeal shall be given also to 
the State agency and to the Regional Administrator.
    (c) Review by Regional Administrator. (1) The appropriate Regional 
Administrator, Employment and Training Administration, upon request for 
review by an applicant or the State agency shall, or upon the Regional 
Administrator's own motion may, review a decision on appeal issued 
pursuant to paragraph (a) or (b) of this section.
    (2) Any request for review by an applicant or a State agency shall 
be filed, and any review on the Regional Administrator's own motion 
shall be undertaken, within 15 days after notice of the decision on 
appeal was delivered or mailed to the individual.
    (3)(i) A request for review by an individual may be filed with the 
appropriate State agency, which shall forward the request to the 
appropriate Regional Administrator, Employment and

[[Page 166]]

Training Administration, or may be filed directly with the appropriate 
Regional Administrator.
    (ii) A request for review by a State agency shall be filed with the 
appropriate Regional Administrator, and a copy shall be served on the 
individual by delivery to the individual personally or by mail to the 
individual's last known address.
    (iii) When a Regional Administrator undertakes a review of a 
decision on the Regional Administrator's own motion, notice thereof 
shall be served promptly on the individual and the State agency.
    (iv) Whenever review by a Regional Administrator is undertaken 
pursuant to an appeal or on the Regional Administrator's own motion, the 
State agency shall promptly forward to the Regional Administrator the 
entire record of the case.
    (v) Where service on the individual is required by paragraph 
(c)(3)(ii) of this section, adequate proof of service shall be furnished 
for the record before the Regional Administrator, and be a condition of 
the Regional Administrator undertaking review pursuant to this 
paragraph.
    (4) The decision of the Regional Administrator on review shall be 
rendered promptly, and not later than the earlier of--
    (i) 45 days after the appeal is received or is undertaken by the 
Regional Administrator, or
    (ii) 90 days from the date the individual's appeal from the 
determination or redetermination was received by the State agency.
    (5) Notice of the Regional Administrator's decision shall be mailed 
promptly to the last known address of the individual, to the State 
agency of the applicable State, and to the Administrator, Office of 
Workforce Security. The decision of the Regional Administrator shall be 
the final decision under the Act and this part, unless there is further 
review by the Assistant Secretary as provided in paragraph (d) of this 
section.
    (d) Further review by the Assistant Secretary. (1) The Assistant 
Secretary for Employment and Training on his or her own motion may 
review any decision by a Regional Administrator issued pursuant to 
paragraph (c) of this section.
    (2) Notice of a motion for review by the Assistant Secretary shall 
be given to the applicant, the State agency of the applicable State, the 
appropriate Regional Administrator, and the Administrator, Office of 
Workforce Security.
    (3) When the Regional Administrator and the State agency are 
notified of the Assistant Secretary's motion for review, they shall 
forward all records in the case to the Assistant Secretary.
    (4) Review by the Assistant Secretary shall be solely on the record 
in the case, any other written contentions or evidence requested by the 
Assistant Secretary, and any further evidence or arguments offered by 
the individual, the State agency, the Regional Administrator, or the 
Administrator, Office of Workforce Security, which are mailed to the 
Assistant Secretary within 15 days after mailing the notice of motion 
for review.
    (5) Upon review of a case under this paragraph, the Assistant 
Secretary may affirm, modify, or reverse the decision of the Regional 
Administrator, and may remand the case for further proceedings and 
decision in accordance with the Assistant Secretary's decision.
    (6) The decision of the Assistant Secretary shall be made promptly, 
and notice thereof shall be sent to the applicant, the State agency, the 
Regional Administrator, and the Administrator, Office of Workforce 
Security.
    (7) The decision of the Assistant Secretary shall be final and 
conclusive, and binding on all interested parties, and shall be a 
precedent applicable throughout the States.
    (e) Procedural requirements. (1) All decisions on first-stage 
appeals from determinations or redeterminations by the State agencies 
must be made within 30 days of the appeal; therefore, the Secretary's 
``Standard for Appeals Promptness-Unemployment Compensation'' in part 
650 of this chapter shall not apply to the DUA program.
    (2) The provisions on right of appeal and opportunity for hearing 
and review with respect to applications for DUA shall be consistent with 
this part and with sections 303(a)(1) and 303(a)(3) of

[[Page 167]]

the Social Security Act, 42 U.S.C. 503(a)(1) and 503(a)(3).
    (3) Any petition or other matter required to be filed within a time 
limit under this section shall be deemed to be filed at the time it is 
delivered to an appropriate office, or at the time of the postmark if it 
is mailed via the United States Postal Service to an appropriate office.
    (4) If any limited time period specified in this section ends on a 
Saturday, Sunday, or a legal holiday in the major disaster area, the 
time limit shall be extended to the next business day.

[42 FR 46712, Sept. 16, 1977, as amended at 55 FR 555, Jan. 5, 1990; 56 
FR 22805, May 16, 1991; 71 FR 35516, June 21, 2006]



Sec.  625.11  Provisions of State law applicable.

    The terms and conditions of the State law of the applicable State 
for an individual, which apply to claims for, and the payment of regular 
compensation, shall apply to applications for, and the payment of, DUA 
to each such individual, only as specifically set forth in the 
provisions of this part.



Sec.  625.12  The applicable State for an individual.

    (a) Applicable State. The applicable State for an individual shall 
be that State in which the individual's unemployment is the result of a 
major disaster.
    (b) Limitation. DUA is payable to an individual only by an 
applicable State as determined pursuant to paragraph (a) of this 
section, and--
    (1) Only pursuant to an Agreement entered into pursuant to the Act 
and this part, and with respect to weeks in which the Agreement is in 
effect; and
    (2) Only with respect to weeks of unemployment that begin during a 
Disaster Assistance Period.

[42 FR 46712, Sept. 16, 1977, as amended at 55 FR 556, Jan. 5, 1990; 71 
FR 35516, June 21, 2006]



Sec.  625.13  Restrictions on entitlement; disqualification.

    (a) Income reductions. The amount of DUA payable to an individual 
for a week of unemployment, as computed pursuant toSec. 625.6, shall 
be reduced by the amount of any of the following that an individual has 
received for the week or would receive for the week if the individual 
filed a claim or application therefor and took all procedural steps 
necessary under the appropriate law, contract, or policy to receive such 
payment:
    (1) Any benefits or insurance proceed from any source not defined as 
``compensation'' underSec. 625.2(d) for loss of wages due to illness 
or disability;
    (2) A supplemental unemployment benefit pursuant to a collective 
bargaining agreement.
    (3) Private income protection insurance;
    (4) Any workers' compensation by virtue of the death of the head of 
the household as the result of the major disaster in the major disaster 
area, prorated by weeks, if the individual has become the head of the 
household and is seeking suitable work because the head of the household 
died as the result of the major disaster in the major disaster area; and
    (5) The prorated amount of a retirement pension or annuity under a 
public or private retirement plan or system, prorated, where necessary, 
by weeks, but only if, and to the extent that, such amount would be 
deducted from regular compensation payable under the applicable State 
law.
    (6) The prorated amount of primary benefits under title II of the 
Social Security Act, but only to the extent that such benefits would be 
deduced from regular compensation if payable to the individual under the 
applicable State law.
    (b) Disqualification. (1) An individual shall not be entitled to DUA 
for any week after the week in which the individual is reemployed in a 
suitable position.
    (2) An individual who refuses without good cause to accept a bona 
fide offer of reemployment in a position suitable to the individual, or 
to investigate or accept a referral to a position which is suitable to 
and available to the individual, shall not be entitled to DUA with 
respect to the week in which such refusal occurs or in any subsequent 
week in the Disaster Assistance Period. For the purposes of this 
paragraph, a position shall not be deemed to be suitable for an 
individual if the circumstances present any unusual risk

[[Page 168]]

to the health, safety, or morals of the individual, if it is 
impracticable for the individual to accept the position, or if 
acceptance for the position would, as to the individual, be inconsistent 
with any labor standard in section 3304(a)(5) of the Federal 
Unemployment Tax Act, 26 U.S.C. 3304(a)(5), or the comparable provisions 
of the applicable State law.

[42 FR 46712, Sept. 16, 1977, as amended at 55 FR 556, Jan. 5, 1990]



Sec.  625.14  Overpayments; disqualification for fraud.

    (a) Finding and repayment. If the State agency of the applicable 
State finds that an individual has received a payment of DUA to which 
the individual was not entitled under the Act and this part, whether or 
not the payment was due to the individual's fault or misrepresentation, 
the individual shall be liable to repay to the applicable State the 
total sum of the payment to which the individual was not entitled, and 
the State agency shall take all reasonable measures authorized under any 
State law or Federal law to recover for the account of the United States 
the total sum of the payment to which the individual was not entitled.
    (b) Recovery by offset. (1) The State agency shall recover, insofar 
as is possible, the amount of any outstanding overpayment of DUA made to 
the individual by the State, by deductions from any DUA payable to the 
individual under the Act and this part, or from any compensation payable 
to the individual under any Federal unemployment compensation law 
administered by the State agency, or from any assistance or allowance 
payable to the individual with respect to unemployment under any other 
Federal law administered by the State agency.
    (2) The State agency shall also recover, insofar as possible, the 
amount of any outstanding overpayment of DUA made to the individual by 
another State, by deductions from any DUA payable by the State agency to 
the individual under the Act and this part, or from any compensation 
payable to the individual under any Federal unemployment compensation 
law administered by the State agency, or from any assistance or 
allowance payable to the individual with respect to unemployment under 
any other Federal law administered by the State agency.
    (3) If the State has in effect an agreement to implement the cross-
program offset provisions of section 303(g)(2) of the Social Security 
Act (42 U.S.C. 503(g)(2)), the State shall apply the provisions of such 
agreement to the recovery of outstanding DUA overpayments.
    (c) Debts due the United States. DUA payable to an individual shall 
be applied by the State agency for the recovery by offset of any debt 
due to the United States from the individual, but shall not be applied 
or used by the State agency in any manner for the payment of any debt of 
the individual to any State or any other entity or person.
    (d) Recovered overpayments. Overpayments recovered in any manner 
shall be credited or returned, as the case may be, to the appropriate 
account of the United States.
    (e) Application of State law. Any provision of State law authorizing 
waiver of recovery of overpayments of compensation shall not be 
applicable to DUA.
    (f) Final decision. Recovery of any overpayment of DUA shall not be 
enforced by the State agency until the determination establishing the 
overpayment has become final, or if appeal is taken from the 
determination, until the decision after opportunity for a fair hearing 
has become final.
    (g) Procedural requirements. (1) The provisions of paragraphs (c), 
(d), and (f) ofSec. 625.9 shall apply to determinations and 
redeterminations made pursuant to this section.
    (2) The provisions ofSec. 625.10 shall apply to determinations and 
redeterminations made pursuant to this section.
    (h) Fraud detection and prevention. Provisions in the procedures of 
each State with respect to detection and prevention of fraudulent 
overpayments of DUA shall be, as a minimum, commensurate with the 
procedures adopted by the State with respect to regular compensation and 
consistent with the Secretary's ``Standard for Fraud and Overpayment 
Detection,'' Employment Security Manual, part V, sections 7510 et seq. 
(Appendix C of this part).
    (i) Disqualification for fraud. Any individual who, with respect to 
a major

[[Page 169]]

disaster, makes or causes another to make a false statement or 
misrepresentation of a material fact, knowing it to be false, or 
knowingly fails or causes another to fail to disclose a material fact, 
in order to obtain for the individual or any other person a payment of 
DUA to which the individual or any other person is not entitled, shall 
be disqualified as follows:
    (1) If the false statement, misrepresentation, or nondisclosure 
pertains to an initial application for DUA--
    (i) The individual making the false statement, misrepresentation, or 
nondisclosure shall be disqualified from the receipt of any DUA with 
respect to that major disaster; and
    (ii) If the false statement, misrepresentation, or nondisclosure was 
made on behalf of another individual, and was known to such other 
individual to be a false statement, misrepresentation, or nondisclosure, 
such other individual shall be disqualified from the receipt of any DUA 
with respect to that major disaster; and
    (2) If the false statement, misrepresentation, or nondisclosure 
pertains to a week for which application for a payment of DUA is made--
    (i) The individual making the false statement, misrepresentation, or 
nondisclosure shall be disqualified from the receipt of DUA for that 
week and the first two compensable weeks in the Disaster Assistance 
Period that immediately follow that week, with respect to which the 
individual is otherwise entitled to a payment of DUA; and
    (ii) If the false statement, misrepresentation, or nondisclosure was 
made on behalf of another individual, and was known to such other 
individual to be a false statement, misrepresentation, or nondisclosure, 
such other individual shall be disqualified from the receipt of DUA for 
that week and the first two compensable weeks in the Disaster Assistance 
Period that immediately follow that week, with respect to which the 
individual is otherwise entitled to a payment of DUA.
    (j) Criminal penalties. The provisions of this section on recovery 
of overpayments and disqualification for fraudulently claiming or 
receiving any DUA to which an individual was not entitled under the Act 
and this part shall be in addition to and shall not preclude any 
applicable criminal prosecution and penalties under State or Federal 
law.

[42 FR 46712, Sept. 16, 1977, as amended at 55 FR 556, Jan. 5, 1990; 71 
FR 35516, June 21, 2006]



Sec.  625.15  Inviolate rights to DUA.

    Except as specifically provided in this part, the right of 
individuals to DUA shall be protected in the same manner and to the same 
extent as the rights of persons to regular unemployment compensation are 
protected under the applicable State law. Such measures shall include 
protection of applicants for DUA from waiver, release, assignment, 
pledge, encumbrance, levy, execution, attachment, and garnishment, of 
their rights to DUA. In the same manner and to the same extent, 
individuals shall be protected from discrimination and obstruction in 
regard to seeking, applying for and receiving any right to DUA.



Sec.  625.16  Recordkeeping; disclosure of information.

    (a) Recordkeeping. Each State agency will make and maintain records 
pertaining to the administration of the Act as the Secretary requires, 
and will make all such records available for inspection, examination, 
and audit by such Federal officials or employees as the Secretary may 
designate or as may be required by law.
    (b) Disclosure of information. Information in records made and 
maintained by a State agency in administering the Act shall be kept 
confidential, and information in such records may be disclosed only in 
the same manner and to the same extent as information with respect to 
regular compensation and the entitlement of individuals thereto may be 
disclosed under the applicable State law, and consistently with section 
303(a)(1) of the Social Security Act, 42 U.S.C. 503(a)(1). This 
provision on the confidentiality of information obtained in the 
administration of the Act shall not apply, however, to the United States 
Department of Labor, or in the case of information, reports and studies 
requested pursuant toSec. 625.19, or where the result would be 
inconsistent with the Freedom of Information Act (5 U.S.C. 552), the 
Privacy Act of 1974 (5 U.S.C. 552a), or regulations of

[[Page 170]]

the United States Department of Labor promulgated thereunder.



Sec.  625.17  Announcement of the beginning of a Disaster Assistance
Period.

    Whenever a major disaster is declared in a State, the State agency 
shall promptly announce throughout the major disaster area by all 
appropriate news media that individuals who are unemployed as the result 
of the major disaster may be entitled to DUA; that they should file 
initial applications for DUA as soon as possible, but not later than the 
30th day after the announcement date; the beginning date of the Disaster 
Assistance Period; and where individuals may obtain further information 
and file applications for DUA.



Sec.  625.18  Public access to Agreements.

    The State agency of a State will make available to any individual or 
organization a true copy of the Agreement with the State for inspection 
and copying. Copies of an Agreement may be furnished on request to any 
individual or organization upon payment of the same charges, if any, as 
apply to the furnishing of copies of other records of the State agency.



Sec.  625.19  Information, reports and studies.

    (a) Routine responses. State agencies shall furnish to the Secretary 
such information and reports and make such studies as the Secretary 
decides are necessary or appropriate for carrying out the purposes of 
the Act and this part.
    (b) Final report. In addition to such other reports as may be 
required by the Secretary, within 60 days after all payments of Disaster 
Unemployment Assistance as the result of a major disaster in the State 
have been made, the State agency shall submit a final report to the 
Secretary. A final report shall contain a narrative summary, a 
chronological list of significant events, pertinent statistics about the 
Disaster Unemployment Assistance provided to disaster victims, brief 
statements of major problems encountered, discussion of lessons learned, 
and suggestions for improvement of the program during future major 
disasters.

(Approved by the Office of Management and Budget under control number 
1205-0051)

(Pub. L. No. 96-511)

[15 FR 5886, Aug. 31, 1950; 23 FR 1267, Mar. 1, 1958, as amended at 49 
FR 18295, Apr. 30, 1984]



Sec.  625.20  [Reserved]



Sec.  625.30  Appeal Procedures for Guam, American Samoa, Commonwealth
of the Northern Mariana Islands, Federated States of Micronesia,
Republic of the Marshall Islands, and the Trust Territory of the 
Pacific Islands.

    (a) Designation of referee. The Director of the Unemployment 
Insurance Service shall designate a referee of a State agency to hear 
and decide appeals under this section from determinations and 
redeterminations by the State agencies of the Territory of Guam, 
American Samoa, Commonwealth of the Northern Mariana Islands, Federated 
States of Micronesia, Republic of the Marshall Islands, and the Trust 
Territory of the Pacific Islands.
    (b) Appeals to referee. (1) A DUA applicant may appeal from a 
determination or redetermination issued by the State agency of the 
Territory of Guam, American Samoa, Commonwealth of the Northern Mariana 
Islands, Federated States of Micronesia, Republic of the Marshall 
Islands, or the Trust Territory of the Pacific Islands within 60 days 
after the mailing of notice and a copy of such determination or 
redetermination to such applicant's last known address, or in the 
absence of mailing within 60 days after delivery in person thereof to 
such applicant. The appeal shall be in writing and may be filed with any 
office of the State agency.
    (2) Notice that an appeal has been filed may be given or mailed, in 
the discretion of the referee, to any person who has offered or is 
believed to have evidence with respect to the claim.
    (3) An appeal shall be promptly scheduled and heard, in order that a 
decision on the appeal can be issued within 30 days after receipt of the 
appeal by the State agency. Written notice of hearing, specifying the 
time and place

[[Page 171]]

thereof and those questions known to be in dispute, shall be given or 
mailed to the applicant, the State agency, and any person who has 
offered or is believed to have evidence with respect to the claim 7 days 
or more before the hearing, except that a shorter notice period may be 
used with the consent of the applicant.
    (c) Conduct of hearings. Hearings before the referee shall be 
informal, fair, and impartial, and shall be conducted in such manner as 
may be best suited to determine the DUA applicants' right to 
compensation. Hearings shall be open to the public unless sufficient 
cause for a closed hearing is shown. The referee shall open a hearing by 
ascertaining and summarizing the issue or issues involved in the appeal. 
The applicant may examine and cross-examine witnesses, inspect 
documents, and explain or rebut any evidence. An opportunity to present 
argument shall be afforded such applicant, and such argument shall be 
made part of the record. The referee shall give such applicant, if not 
represented by counsel or other representative, every assistance that 
does not interfere with the impartial discharge of the referee's duties. 
The referee may examine such applicant and other witnesses to such 
extent as the referee deems necessary. Any issue involved in the claim 
shall be considered and passed upon even though such issue was not set 
forth as a ground of appeal.
    (d) Evidence. Oral or written evidence of any nature, whether or not 
conforming to the legal rules of evidence, may be accepted. Any official 
record of the State agency, including reports submitted in connection 
with administration of the DUA program, may be included in the record if 
the applicant is given an opportunity to examine and rebut the same. A 
written statement under oath or affirmation may be accepted when it 
appears impossible or unduly burdensome to require the attendance of a 
witness, but a DUA applicant adversely affected by such a statement must 
be given the opportunity to examine such statement, to comment on or 
rebut any or all portions thereof, and whenever possible to cross-
examine a witness whose testimony has been introduced in written form by 
submitting written questions to be answered in writing.
    (e) Record. All oral testimony before the referee shall be taken 
under oath or affirmation and a transcript thereof shall be made and 
kept. Such transcript together with all exhibits, papers, and requests 
filed in the proceeding shall constitute the record for decision.
    (f) Withdrawal of appeal. A DUA applicant who has filed an appeal 
may withdraw such appeal with the approval of the referee.
    (g) Nonappearance of DUA applicant. Failure of a DUA applicant to 
appear at a hearing shall not result in a decision being automatically 
rendered against such applicant. The referee shall render a decision on 
the basis of whatever evidence is properly before him/her unless there 
appears to be a good reason for continuing the hearing. An applicant who 
fails to appear at a hearing with respect to his/her appeal may within 
seven days thereafter petition for a reopening of the hearing. Such 
petition shall be granted if it appears to the referee that such 
applicant has shown good cause for his/her failure to attend.
    (h) Notice of referee's decision and further review--(1) Decision. A 
copy of the referee's decision, which shall include findings and 
conclusions, shall promptly be given or mailed to the applicant, the 
State agency, and to the Regional Administrator, Employment and Training 
Administration, for Region VI (San Francisco). The decision of the 
referee shall be accompanied by an explanation of the right of such 
applicant or State agency to request review by the Regional 
Administrator and the time and manner in which such review may be 
instituted, as provided in paragraph (a)(2) ofSec. 625.10.
    (2) Time limit for decision. A decision on an appeal to a referee 
under this section shall be made and issued by the referee not later 
than 30 days after receipt of the appeal by the State agency.
    (3) Further review. Further review by the Regional Administrator or 
the Assistant Secretary with respect to an appeal under this section 
shall be in accordance with paragraphs (c) and (d) ofSec. 625.10.

[[Page 172]]

    (i) Consolidation of appeals. The referee may consolidate appeals 
and conduct joint hearings thereon where the same or substantially 
similar evidence is relevant and material to the matters in issue. 
Reasonable notice of consolidation and the time and place of hearing 
shall be given or mailed to the applicants or their representatives, the 
State agency, and to persons who have offered or are believed to have 
evidence with respect to the DUA claims.
    (j) Representation. A DUA applicant may be represented by counsel or 
other representative in any proceedings before the referee or the 
Regional Administrator. Any such representative may appear at any 
hearing or take any other action which such applicant may take under 
this part. The referee, for cause, may bar any person from representing 
an applicant, in which event such action shall be set forth in the 
record. No representative shall charge an applicant more than an amount 
fixed by the referee for representing the applicant in any proceeding 
under this section.
    (k) Postponement, continuance, and adjournment of hearings. A 
hearing before the referee shall be postponed, continued, or adjourned 
when such action is necessary to afford a DUA applicant reasonable 
opportunity for a fair hearing. In such case notice of the subsequent 
hearing shall be given to any person who received notice of the prior 
hearing.
    (l) Information from agency records. Information shall be available 
to a DUA applicant, either from the records of the State agency or as 
obtained in any proceeding herein provided for, to the extent necessary 
for proper presentation of his/her case. All requests for information 
shall state the nature of the information desired as clearly as possible 
and shall be in writing unless made at a hearing.
    (m) Filing of decisions. Copies of all decisions of the referee 
shall be kept on file at his/her office or agency for at least 3 years.

[55 FR 557, Jan. 5, 1990, as amended at 56 FR 22805, May 16, 1991; 71 FR 
35516, June 21, 2006]



    Sec. Appendix A to Part 625--Standard for Claim Filing, Claimant 
             Reporting, Job Finding, and Employment Services

         Employment Security Manual (Part V, Sections 5000-5004)

  5000 Standard for Claim Filing, Claimant Reporting, Job Finding, and 
                           Employment Services

    A. Federal law requirements. Section 3304(a)(1) of the Federal 
Unemployment Tax Act and section 303(a)(2) of the Social Security Act 
require that a State law provide for: ``Payment of unemployment 
compensation solely through public employment offices or such other 
agencies as the Secretary may approve.''
    Section 3304(a)(4) of the Federal Unemployment Tax Act and section 
303(a)(5) of the Social Security Act require that a State law provide 
for: ``Expenditure of all money withdrawn from an unemployment fund of 
such State, in the payment of unemployment compensation * * *''
    Section 303(a)(1) of the Social Security Act requires that the State 
law provide for: ``Such methods of administration . . . as are found by 
the Secretary to be reasonably calculated to insure full payment of 
unemployment compensation when due.''
    B. Secretary's interpretation of federal law requirements: 1. The 
Secretary interprets section 3304(a)(1) of the Federal Unemployment Tax 
Act and section 303(a)(2) of the Social Security Act to require that a 
State law provide for payment of unemployment compensation solely 
through public employment offices or claims offices administered by the 
State employment security agency if such agency provides for such 
coordination in the operations of its public employment offices and 
claims offices as will insure (a) the payment of benefits only to 
individuals who are unemployed and who are able to work and available 
for work, and (b) that individuals claiming unemployment compensation 
(claimants) are afforded such placement and other employment services as 
are necessary and appropriate to return them to suitable work as soon as 
possible.
    2. The Secretary interprets all the above sections to require that a 
State law provide for: a. Such contact by claimants with public 
employment offices or claims offices or both, (1) as will reasonably 
insure the payment of unemployment compensation only to individuals who 
are unemployed and who are able to work and available for work, and (2) 
that claimants are afforded such placement and other employment services 
as are necessary and appropriate to facilitate their return to suitable 
work as soon as possible; and b. Methods of administration which do not 
unreasonably limit the opportunity of

[[Page 173]]

individuals to establish their right to unemployment compensation due 
under such State law.

   5001 Claim Filing and Claimant Reporting Requirements Designed To 
                   Satisfy Secretary's Interpretation

    A. Claim filing--total or part-total unemployment: 1. Individuals 
claiming unemployment compensation for total or part-total unemployment 
are required to file a claim weekly or biweekly, in person or by mail, 
at a public employment office or a claims office (these terms include 
offices at itinerant points) as set forth below.
    2. Except as provided in paragraph 3, a claimant is required to file 
in person: a. His new claim with respect to a benefit year, or his 
continued claim for a waiting week or for his first compensable week of 
unemployment in such year; and b. Any other claim, when requested to do 
so by the claims personnel at the office at which he files his claim(s) 
because questions about his right to benefits are raised by 
circumstances such as the following:
    (1) The conditions or circumstances of his separation from 
employment;
    (2) The claimant's answers to questions on mail claim(s) indicate 
that he may be unable to work or that there may be undue restrictions on 
his availability for work or that his search for work may be inadequate 
or that he may be disqualified;
    (3) The claimant's answers to questions on mail claims create 
uncertainty about his credibility or indicate a lack of understanding of 
the applicable requirements; or
    (4) The claimant's record shows that he has previously filed a 
fraudulent claim.
    In such circumstances, the claimant is required to continue to file 
claims in person each week (or biweekly) until the State agency 
determines that filing claims in person is no longer required for the 
resolution of such questions.
    3. A claimant must be permitted to file a claim by mail in any of 
the following circumstances: a. He is located in an area requiring the 
expenditure of an unreasonable amount of time or money in traveling to 
the nearest facility established by the State agency for filing claims 
in person; b. Conditions make it impracticable for the agency to take 
claims in person; c. He has returned to full-time work on or before the 
scheduled date for his filing a claim, unless the agency makes provision 
for in-person filing at a time and place that does not interfere with 
his employment; d. The agency finds that he has good cause for failing 
to file a claim in person.
    4. A claimant who has been receiving benefits for partial 
unemployment may continue to file claims as if he were a partially 
unemployed worker for the first four consecutive weeks of total or part-
total unemployment immediately following his period of partial 
unemployment so long as he remains attached to his regular employer.
    B. Claim filing--partial unemployment. Each individual claiming 
unemployment compensation for a week (or other claim period) during 
which, because of lack of work, he is working less than his normal 
customary full-time hours for his regular employer and is earning less 
than the earnings limit provided in the State law, shall not be required 
to file a claim for such week or other claim period earlier than 2 weeks 
from the date that wages are paid for such claim period or, if a low 
earnings report is required by the State law, from the date the employer 
furnished such report to the individual. State agencies may permit 
claims for partial unemployment to be filed either in person or by mail, 
except that in the circumstances set forth in section A 3, filing by 
mail must be permitted, and in the circumstances set forth in section A 
2 b, filing in person may be required.

   5002 Requirement for Job Finding, Placement, and other Employment 
         Services Designed To Satisfy Secretary's Interpretation

    A. Claims personnel are required to assure that each claimant is 
doing what a reasonable individual in his circumstances would do to 
obtain suitable work.
    B. In the discretion of the State agency: 1. The claims personnel 
are required to give each claimant such necessary and appropriate 
assistance as they reasonably can in finding suitable work and at their 
discretion determine when more complete placement and employment 
services are necessary and appropriate for a claimant; and if they 
determine more complete services are necessary and appropriate, the 
claims personnel are to refer him to employment service personnel in the 
public employment office in which he has been filing claim(s), or, if he 
has been filing in a claims office, in the public employment office most 
accessible to him; or
    2. All placement and employment services are required to be afforded 
to each claimant by employment service personnel in the public 
employment office most accessible to him in which case the claims 
personnel in the office in which the claimant files his claim are to 
refer him to the employment service personnel when placement or other 
employment services are necessary and appropriate for him.
    C. The personnel to whom the State agency assigns the 
responsibilities outlined in paragraph B above are required to give 
claimants such job-finding assistance, placement, and other employment 
services as are necessary and appropriate to facilitate their return to 
suitable work as soon as possible.
    In some circumstances, no such services or only limited services may 
be required. For example, if a claimant is on a short-term

[[Page 174]]

temporary layoff with a fixed return date, the only service necessary 
and appropriate to be given to him during the period of the layoff is a 
referral to suitable temporary work if such work is being performed in 
the labor market area.
    Similarly, claimants whose unemployment is caused by a labor dispute 
presumably will return to work with their employer as soon as the labor 
dispute is settled. They generally do not need services, nor do 
individuals in occupations where placement customarily is made by other 
nonfee charging placement facilities such as unions and professional 
associations.
    Claimants who fall within the classes which ordinarily would require 
limited services or no services shall, if they request placement and 
employment services, be afforded such services as are necessary and 
appropriate for them to obtain suitable work or to achieve their 
reasonable employment goals.
    On the other hand, a claimant who is permanently separated from his 
job is likely to require some services. He may need only some direction 
in how to get a job; he may need placement services if he is in an 
occupation for which there is some demand in the labor market area; if 
his occupation is outdated, he may require counseling and referral to a 
suitable training course. The extent and character of the services to be 
given any particular claimant may change with the length of his 
unemployment and depend not only on his own circumstances and 
conditions, but also on the condition of the labor market in the area.
    D. Claimants are required to report to employment service personnel, 
as directed, but such personnel and the claims personnel are required to 
so arrange and coordinate the contracts required of a claimant as not to 
place an unreasonable burden on him or unreasonably limit his 
opportunity to establish his rights to compensation. As a general rule, 
a claimant is not required to contact in person claims personnel or 
employment service personnel more frequently than once a week, unless he 
is directed to report more frequently for a specific service such as 
referral to a job or a training course or counseling which cannot be 
completed in one visit.
    E. Employment service personnel are required to report promptly to 
claims personnel in the office in which the claimant files his claim(s): 
(1) his failure to apply for or accept work to which he was referred by 
such personnel or when known, by any other nonfee-charging placement 
facility such as a union or a professional association; and (2) any 
information which becomes available to it that may have a bearing on the 
claimant's ability to work or availability for work, or on the 
suitability of work to which he was referred or which was offered to 
him.

             5004 Evaluation of Alternative State Provisions

    If the State law provisions do not conform to the ``suggested State 
law requirements'' set forth in sections 5001 and 5002, but the State 
law contains alternative provisions, the Manpower Administrator, in 
collaboration with the State agency, will study the actual or 
anticipated affect of the alternative provisions. If the Manpower 
Administrator concludes that the alternative provisions satisfy the 
requirements of the Federal law as construed by the Secretary (see 
section 5000 B) he will so notify the State agency. If he does not so 
conclude, he will submit the matter to the Secretary. If the Secretary 
concludes that the alternative provisions satisfy such requirements, the 
State agency will be so notified. If the Secretary concludes that there 
is a question as to whether the alternative provisions satisfy such 
requirements, the State agency will be advised that unless the State law 
provisions are appropriately revised, a notice of hearing will be issued 
as required by the Code of Federal Regulations, title 20, section 601.5.

[55 FR 558, Jan. 5, 1990]



    Sec. Appendix B to Part 625--Standard for Claim Determinations--
                         Separation Information

         Employment Security Manual (Part V, Sections 6010-6015)

   6010-6019 Standard for Claim Determinations--Separation Information

    6010 Federal Law Requirements. Section 303(a)(1) of the Social 
Security Act requires that a State law include provision for: ``Such 
methods of administration . . . as are found by the Secretary to be 
reasonably calculated to insure full payment of unemployment 
compensation when due.''
    Section 303(a)(3) of the Social Security Act requires that a State 
law include provision for: ``Opportunity for a fair hearing before an 
impartial tribunal, for all individuals whose claims for unemployment 
compensation are denied.''
    Section 3304(a)(4) of the Federal Unemployment Tax Act and section 
303(a)(5) of the Social Security Act require that a State law include 
provision for: ``Expenditure of all money withdrawn from an unemployment 
fund of such State, in the payment of unemployment compensation . . . 
.''
    Section 3306(h) of the Federal Unemployment Tax Act defines 
``compensation'' as ``cash benefits payable to individuals with respect 
to their unemployment.''
    6011 Secretary's Interpretation of Federal Law Requirements. The 
Secretary interprets the above sections to require that a State law 
include provisions which will insure that: A. Individuals who may be 
entitled to unemployment compensation are furnished

[[Page 175]]

such information as will reasonably afford them an opportunity to know, 
establish, and protect their rights under the unemployment compensation 
law of such State, and
    B. The State agency obtains and records in time for the prompt 
determination and review of benefit claims such information as will 
reasonably insure the payment of benefits to individuals to whom 
benefits are due.
    6012 Criteria for Review of State Law Conformity with Federal 
Requirements. In determining the conformity of a State law with the 
above requirements of the Federal Unemployment Tax Act and the Social 
Security Act as interpreted by the Secretary, the following criteria 
will be applied:
    A. Is it required that individuals who may be entitled to 
unemployment compensation be furnished such information of their 
potential rights to benefits, including the manner and places of filing 
claims, the reasons for determinations, and their rights of appeal, as 
will insure them a reasonable opportunity to know, establish, and 
protect their rights under the law of the State?
    B. Is the State agency required to obtain, in time for prompt 
determination of rights to benefits such information as will reasonably 
insure the payment of benefits to individuals to whom benefits are due?
    C. Is the State agency required to keep records of the facts 
considered in reaching determinations of rights to benefits?

 6013 Claim Determinations Requirements Designed To Meet Department of 
                             Labor Criteria.

    A. Investigation of claims. The State agency is required to obtain 
promptly and prior to a determination of an individual's right to 
benefits, such facts pertaining thereto as will be sufficient reasonably 
to insure the payment of benefits when due.
    This requirement embraces five separate elements:
    1. It is the responsibility of the agency to take the initiative in 
the discovery of information. This responsibility may not be passed on 
to the claimant or the employer. In addition to the agency's own 
records, this information may be obtained from the worker, the employer, 
or other sources. If the information obtained in the first instance 
discloses no essential disagreement and provides a sufficient basis for 
a fair determination, no further investigation is necessary. If the 
information obtained from other sources differs essentially from that 
furnished by the claimant, the agency, in order to meet its 
responsibility, is required to inform the claimant of such information 
from other sources and to afford the claimant an opportunity to furnish 
any further facts he may have.
    2. Evidentiary facts must be obtained as distinguished from ultimate 
facts or conclusions. That a worker was discharged for misconduct is an 
ultimate fact or conclusion; that he destroyed a machine upon which he 
was working is a primary or evidentiary fact, and the sort of fact that 
the requirement refers to.
    3. The information obtained must be sufficient reasonably to insure 
the payment of benefits when due. In general, the investigation made by 
the agency must be complete enough to provide information upon which the 
agency may act with reasonable assurance that its decision is consistent 
with the unemployment compensation law. On the other hand, the 
investigation should not be so exhaustive and time-consuming as unduly 
to delay the payment of benefits and to result in excessive costs.
    4. Information must be obtained promptly so that the payment of 
benefits is not unduly delayed.
    5. If the State agency requires any particular evidence from the 
worker, it must give him a reasonable opportunity to obtain such 
evidence.
    B. Recording of facts. The agency must keep a written record of the 
facts considered in reaching its determinations.
    C. Determination notices
    1. The agency must give each claimant a written notice of:
    a. Any monetary determination with respect to his benefit year;
    b. Any determination with respect to purging a disqualification if, 
under the State law, a condition or qualification must be satisfied with 
respect to each week of disqualification; but in lieu of giving written 
notice of each determination for each week in which it is determined 
that the claimant has met the requirements for purging, the agency may 
inform the claimant that he has purged the disqualification for a week 
by notation on his application identification card or otherwise in 
writing.
    c. Any other determination which adversely affects \1\ his rights to 
benefits, except

[[Page 176]]

that written notice of determination need not be given with respect to:
---------------------------------------------------------------------------

    \1\ A determination ``adversely affects'' claimant's right to 
benefits if it (1) results in a denial to him of benefits (including a 
cancellation of benefits or wage credits or any reduction in whole or in 
part below the weekly or maximum amount established by his monetary 
determination) for any week or other period; or (2) denies credit for a 
waiting week; or (3) applies any disqualification or penalty; or (4) 
determines that he has not satisfied a condition of eligibility, 
requalification for benefits, or purging a disqualification; or (5) 
determines that an overpayment has been made or orders repayment or 
recoupment of any sum paid to him; or (6) applies a previously 
determined overpayment, penalty, or order for repayment or recoupment; 
or (7) in any other way denies claimant a right to benefits under the 
State law.
---------------------------------------------------------------------------

    (1) A week in a benefit year for which the claimant's weekly benefit 
amount is reduced in whole or in part by earnings if, the first time in 
the benefit year that there is such a reduction, he is required to be 
furnished a booklet or leaflet containing the information set forth 
below in paragraph 2 f (1). However, a written notice of determination 
is required if: (a) there is a dispute concerning the reduction with 
respect to any week (e.g., as to the amount computed as the appropriate 
reduction, etc.); or (b) there is a change in the State law (or in the 
application thereof) affecting the reduction; or
    (2) Any week in a benefit year subsequent to the first week in such 
benefit year in which benefits were denied, or reduced in whole or in 
part for reasons other than earnings, if denial or reduction for such 
subsequent week is based on the same reason and the same facts as for 
the first week, and if written notice of determination is required to be 
given to the claimant with respect to such first week, and with such 
notice of determination, he is required to be given a booklet or 
pamphlet containing the information set forth below in paragraphs 2 f 
(2) and 2 h. However, a written notice of determination is required if: 
(a) there is a dispute concerning the denial or reduction of benefits 
with respect to such week; or (b) there is a change in the State law (or 
in the application thereof) affecting the denial or reduction; or (c) 
there is a change in the amount of the reduction except as to the 
balance covered by the last reduction in a series of reductions.
    Note: This procedure may be applied to determinations made with 
respect to any subsequent weeks for the same reason and on the basis of 
the same facts: (a) that claimant is unable to work, unavailable for 
work, or is disqualified under the labor dispute provision; and (b) 
reducing claimant's weekly benefit amount because of income other than 
earnings or offset by reason of overpayment.
    2. The agency must include in written notices of determinations 
furnished to claimants sufficient information to enable them to 
understand the determinations, the reasons therefor, and their rights to 
protest, request reconsideration, or appeal.
    The written notice of monetary determination must contain the 
information specified in the following items (except h) unless an item 
is specifically not applicable. A written notice of any other 
determination must contain the information specified in as many of the 
following items as are necessary to enable the claimant to understand 
the determination and to inform him of his appeal rights. Information 
specifically applicable to the individual claimant must be contained in 
the written notice of determination. Information of general application 
such as (but not limited to) the explanation of benefits for partial 
unemployment, information as to deductions, seasonality factors, and 
information as to the manner and place of taking an appeal, extension of 
the appeal period, and where to obtain information and assistance may be 
contained in a booklet or leaflet which is given the claimant with his 
monetary determination.
    a. Base period wages. The statement concerning base-period wages 
must be in sufficient detail to show the basis of computation of 
eligibility and weekly and maximum benefit amounts. (If maximum benefits 
are allowed, it may not be necessary to show details of earnings.)
    b. Employer name. The name of the employer who reported the wages is 
necessary so that the worker may check the wage transcript and know 
whether it is correct. If the worker is given only the employer number, 
he may not be able to check the accuracy of the wage transcript.
    c. Explanation of benefit formula--weekly and maximum benefit 
amounts. Sufficient information must be given the worker so that he will 
understand how his weekly benefit amount, including allowances for 
dependents, and his maximum benefit amount were figured. If benefits are 
computed by means of a table contained in the law, the table must be 
furnished with the notice of determination whether benefits are granted 
or denied.
    The written notice of determination must show clearly the weekly 
benefit amount and the maximum potential benefits to which the claimant 
is entitled.
    The notice to a claimant found ineligible by reason of insufficient 
earnings in the base period must inform him clearly of the reason for 
ineligibility. An explanation of the benefit formula contained in a 
booklet or pamphlet should be given to each claimant at or prior to the 
time he receives written notice of a monetary determination.
    d. Benefit year. An explanation of what is meant by the benefit year 
and identification of the claimant's benefit year must be included in 
the notice of determination.
    e. Information as to benefits for partial unemployment. There must 
be included either in the written notice of determination or in a 
booklet or pamphlet accompanying the notice an explanation of the 
claimant's rights to partial benefits for any week with respect to which 
he is working less than his normal customary full-time workweek because 
of lack of work and for which he earns less than his weekly benefit 
amount or weekly benefit amount plus earnings, whichever is provided by 
the State law. If the explanation is contained in the notice of 
determination, reference to the item in the notice in which his weekly 
benefit amount is entered should be made.
    f. Deductions from weekly benefits

[[Page 177]]

    (1) Earnings. Although written notice of determinations deducting 
earnings from a claimant's weekly benefit amount is generally not 
required (see paragraph 1 c(1) above), where written notice of 
determination is required (or given) it shall set forth the amount of 
earnings, the method of computing the deduction in sufficient detail to 
enable the claimant to verify the accuracy of the deduction, and his 
right to protest, request redetermination, and appeal. Where a written 
notice of determination is given to the claimant because there has been 
a change in the State law or in the application of the law, an 
explanation of the change shall be included.
    Where claimant is not required to receive a written notice of 
determination, he must be given a booklet or pamphlet the first time in 
his benefit year that there is a deduction for earnings which shall 
include the following information:
    (a) The method of computing deductions for earnings in sufficient 
detail to enable the claimant to verify the accuracy of the deduction;
    (b) That he will not automatically be given a written notice of 
determination for a week with respect to which there is a deduction for 
earnings (unless there is a dispute concerning the reduction with 
respect to a week or there has been a change in the State law or in the 
application of the law affecting the deduction) but that he may obtain 
such a written notice upon request; and
    (c) A clear statement of his right to protest, request a 
redetermination, and appeal from any determination deducting earnings 
from his weekly benefit amount even though he does not automatically 
receive a written notice of determination; and if the State law requires 
written notice of determination in order to effectuate a protest, 
redetermination, or appeal, he must be so advised and advised also that 
he must request a written notice of determination before he takes any 
such action.
    (2) Other deductions
    (a) A written notice of determination is required with respect to 
the first week in claimant's benefit year in which there is a reduction 
from his benefits for a reason other than earnings. This notice must 
describe the deduction made from claimaint's weekly benefit amount, the 
reason for the deduction, the method of computing it in sufficient 
detail to enable him to verify the accuracy of such deduction, and his 
right to protest, request redetermination, or appeal.
    (b) A written notice of determination is not required for subsequent 
weeks that a deduction is made for the same reason and on the basis of 
the same facts, if the notice of determination pursuant to (2)(a), or a 
booklet or pamphlet given him with such notice explains (i) the several 
kinds of deductions which may be made under the State law (e.g., 
retirement pensions, vacation pay, and overpayments); (ii) the method of 
computing each kind of deduction in sufficient detail that claimant will 
be able to verify the accuracy of deductions made from his weekly 
benefit payments; (iii) any limitation on the amount of any deduction or 
the time in which any deduction may be made; (iv) that he will not 
automatically be given a written notice of determination for subsequent 
weeks with respect to which there is a deduction for the same reason and 
on the basis of the same facts, but that he may obtain a written notice 
of determination upon request; (v) his right to protest, request 
redetermination, or appeal with respect to subsequent weeks for which 
there is a reduction from his benefits for the same reason, and on the 
basis of the same facts even though he does not automatically receive a 
written notice of determination; and (vi) that if the State law requires 
written notice of determination in order to effectuate a protest, 
redetermination, or appeal, he must be so advised and advised also that 
he must request a written notice of determination before he takes any 
such action.
    g. Seasonality factors. If the individual's determination is 
affected by seasonality factors under the State law, an adequate 
explanation must be made. General explanations of seasonality factors 
which may affect determinations for subsequent weeks may be included in 
a booklet or pamphlet given claimant with his notice of monetary 
determination.
    h. Disqualification or ineligibility. If a disqualification is 
imposed, or if the claimant is declared ineligible for one or more 
weeks, he must be given not only a statement of the period of 
disqualification or ineligibility and the amount of wage-credit 
reductions, if any, but also an explanation of the reason for the 
ineligibility or disqualification. This explanation must be sufficiently 
detailed so that he will understand why he is ineligibile or why he has 
been disqualified, and what he must do in order to requalify for 
benefits or purge the disqualification. The statement must be 
individualized to indicate the facts upon which the determination was 
based, e.g., state, ``It is found that you left your work with Blank 
Company because you were tired of working; the separation was voluntary, 
and the reason does not constitute good cause,'' rather than merely the 
phrase ``voluntary quit.'' Checking a box as to the reason for the 
disqualification is not a sufficiently detailed explanation. However, 
this statement of the reason for the disqualification need not be a 
restatement of all facts considered in arriving at the determination.
    1. Appeal rights. The claimant must be given information with 
respect to his appeal rights.
    (1) The following information shall be included in the notice of 
determination:

[[Page 178]]

    (a) A statement that he may appeal or, if the State law requires or 
permits a protest or redetermination before an appeal, that he may 
protest or request a redetermination.
    (b) The period within which an appeal, protest, or request for 
redetermination must be filed. The number of days provided by statute 
must be shown as well as either the beginning date or ending date of the 
period. (It is recommended that the ending date of the appeal period be 
shown, as this is the more understandable of the alternatives.)
    (2) The following information must be included either in the notice 
of determination or in separate informational material referred to in 
the notice:
    (a) The manner in which the appeal, protest, or request for 
redetermination must be filed, e.g., by signed letter, written 
statement, or on a prescribed form, and the place or places to which the 
appeal, protest, or request for redetermination may be mailed or hand-
delivered.
    (b) An explanation of any circumstances (such as nonworkdays, good 
cause, etc.) which will extend the period for the appeal, protest, or 
request for redetermination beyond the date stated or identified in the 
notice of determination.
    (c) That any further information claimant may need or desire can be 
obtained together with assistance in filing his appeal, protest, or 
request for redetermination from the local office.
    If the information is given in separate material, the notice of 
determination would adequately refer to such material if it said, for 
example, ``For other information about your (appeal), (protest), 
(redetermination) rights, see pages ---- to ---- of the ---------------- 
(name of pamphlet or booklet) heretofore furnished to you.''

6014 Separation Information Requirements Designed To Meet Department of 
                             Labor Criteria

    A. Information to agency. Where workers are separated, employers are 
required to furnish the agency promptly, either upon agency request or 
upon such separation, a notice describing the reasons for and the 
circumstances of the separation and any additional information which 
might affect a claimant's right to benefits. Where workers are working 
less than full time, employers are required to furnish the agency 
promptly, upon agency request, information concerning a claimant's hours 
of work and his wages during the claim periods involved, and other facts 
which might affect a claimant's eligibility for benefits during such 
periods.
    When workers are separated and the notices are obtained on a request 
basis, or when workers are working less than full time and the agency 
requests information, it is essential to the prompt processing of claims 
that the request be sent out promptly after the claim is filed and the 
employer be given a specific period within which to return the notice, 
preferably within 2 working days.
    When workers are separated and notices are obtained upon separation, 
it is essential that the employer be required to send the notice to the 
agency with sufficient promptness to insure that, if a claim is filed, 
it may be processed promptly. Normally, it is desirable that such a 
notice be sent to the central office of the agency, since the employer 
may not know in which local office the worker will file his claim. The 
usual procedure is for the employer to give the worker a copy of the 
notice sent by the employer to the agency.
    B. Information of worker. 1. Information required to be given. 
Employers are required to give their employees information and 
instructions concerning the employees' potential rights to benefits and 
concerning registration for work and filing claims for benefits.
    The information furnished to employees under such a requirement need 
not be elaborate; it need only be adequate to insure that the worker who 
is separated or who is working less than full time knows he is 
potentially eligible for benefits and is informed as to what he is to do 
or where he is to go to file his claim and register for work. When he 
files his claim, he can obtain more detailed information.
    In States that do not require employers to furnish periodically to 
the State agency detailed reports of the wages paid to their employees, 
each employer is required to furnish to his employees information as to 
(a) the name under which he is registered by the State agency, (b) the 
address where he maintains his payroll records, and (c) the workers' 
need for this information if and when they file claims for benefits.
    2. Methods for giving information. The information and instructions 
required above may be given in any of the following ways:
    a. Posters prominently displayed in the employer's establishment. 
The State agency should supply employers with a sufficient number of 
posters for distribution throughout their places of business and should 
see that the posters are conspicuously displayed at all times.
    b. Leaflets. Leaflets distributed either periodically or at the time 
of separation or reduction of hours. The State agency should supply 
employers with a sufficient number of leaflets.
    c. Individual notices. Individual notices given to each employee at 
the time of separation or reduction in hours.
    It is recommended that the State agency's publicity program be used 
to supplement the employer-information requirements. Such a program 
should stress the availability and location of claim-filing offices and 
the importance of visiting those offices whenever

[[Page 179]]

the worker is unemployed, wishes to apply for benefits, and to seek a 
job.
    6015 Evaluation of Alternative State Provisions with Respect to 
Claim Determinations and Separation Information. If the State law 
provisions do not conform to the suggested requirements set forth in 
sections 6013 and 6014, but the State law contains alternative 
provisions, the Bureau of Employment Security, in collaboration with the 
State agency, will study the actual or anticipated effects of the 
alternative provisions. If the Administrator of the Bureau concludes 
that the alternative provisions satisfy the criteria in section 6012, he 
will so notify the State agency. If the Administrator of the Bureau does 
not so conclude, he will submit the matter to the Secretary. If the 
Secretary concludes that the alternative provisions satisfy the criteria 
in section 6012, the State agency will be so notified. If the Secretary 
concludes that there is a question as to whether the alternative 
provisions satisfy the criteria, the State agency will be advised that 
unless the State law provisions are appropriately revised, a notice of 
hearing will be issued as required by the Code of Federal Regulations, 
title 20, section 601.5.

[55 FR 559, Jan. 5, 1990]



    Sec. Appendix C to Part 625--Standard for Fraud and Overpayment 
                                Detection

         Employment Security Manual (Part V, Sections 7510-7515)

         7510-7519 Standard for Fraud and Overpayment Detection

    7510 Federal Law Requirements. Section 303(a)(1) of the Social 
Security Act requires that a State law include provision for:
    ``Such methods of administration * * * as are found by the Secretary 
to be reasonably calculated to insure full payment of unemployment 
compensation when due.''
    Section 1603(a)(4) of the Internal Revenue Code and section 
3030(a)(5) of the Social Security Act require that a State law include 
provision for:
    ``Expenditure of all money withdrawn from an unemployment fund of 
such State, in the payment of unemployment compensation * * *''
    Section 1607(h) of the Internal Revenue Code defines 
``compensation'' as ``cash benefits payable to individuals with respect 
to their unemployment.''
    7511 The Secretary's Interpretation of Federal Law Requirements. The 
Secretary of Labor interprets the above sections to require that a State 
law include provision for such methods of administration as are, within 
reason, calculated (1) to detect benefits paid through error by the 
agency or through willful misrepresentation or error by the claimant or 
others, and (2) to deter claimants from obtaining benefits through 
willful misrepresentation.
    7513 Criteria for Review of State Conformity With Federal 
Requirements. In determining State conformity with the above 
requirements of the Internal Revenue Code and the Social Security Act, 
as interpreted by the Secretary of Labor, the following criteria will be 
applied:
    A. Are investigations required to be made after the payment of 
benefits, (or, in the case of interstate claims, are investigations made 
by the agent State after the processing of claims) as to claimants' 
entitlement to benefits paid to them in a sufficient proportion of cases 
to test the effectiveness of the agency's procedures for the prevention 
of payments which are not due? To carry out investigations, has the 
agency assigned to some individual or unit, as a basic function, the 
responsibility of making or functionally directing such investigations?
    Explanation: It is not feasible to prescribe the extent to which the 
above activities are required; however, they should always be carried on 
to such an extent that they will show whether or not error or willful 
misrepresentation is increasing or decreasing, and will reveal problem 
areas. The extent and nature of the above activities should be varied 
according to the seriousness of the problem in the State. The 
responsible individual or unit should:
    1. Check paid claims for overpayment and investigate for willful 
misrepresentation or, alternatively, advise and assist the operating 
units in the performance of such functions, or both;
    2. Perform consultative services with respect to methods and 
procedures for the prevention and detection of fraud; and
    3. Perform other services which are closely related to the above.
    Although a State agency is expected to make a full-time assignment 
of responsibility to a unit or individual to carry on the functions 
described above, a small State agency might make these functions a part-
time responsibility of one individual. In connection with the detection 
of overpayments, such a unit or individual might, for example:
    (a) Investigate information on suspected benefit fraud received from 
any agency personnel, and from sources outside the agency, including 
anonymous complaints;
    (b) Investigate information secured from comparisons of benefit 
payments with employment records to detect cases of concurrent working 
(whether in covered or noncovered work) and claiming of benefits 
(including benefit payments in which the agency acted as agency for 
another State).
    The benefit fraud referred to herein may involve employers, agency 
employees, and witnesses, as well as claimants.
    Comparisons of benefit payments with employment records are commonly 
made either

[[Page 180]]

by post-audit or by industry surveys. The so-called ``post-audit'' is a 
matching of central office wage-record files against benefit payments 
for the same period. ``Industry surveys'' or ``mass audits'' are done in 
some States by going directly to employers for pay-roll information to 
be checked against concurrent benefit lists. A plan
    A. of investigation based on a sample post-audit will be considered 
as partial fulfillment of the investigation program; it would need to be 
supplemented by other methods capable of detecting overpayments to 
persons who have moved into noncovered occupations or are claiming 
interstate benefits.
    B. Are adequate records maintained by which the results of 
investigations may be evaluated?
    Explanation: To meet this criterion, the State agency will be 
expected to maintain records of all its activities in the detection of 
overpayments, showing whether attributable to error or willful 
misrepresentation, measuring the results obtained through various 
methods, and noting the remedial action taken in each case. The adequacy 
and effectiveness of various methods of checking for willful 
misrepresentation can be evaluated only if records are kept of the 
results obtained. Internal reports on fraudulent and erroneous 
overpayments are needed by State agencies for self-evaluation. Detailed 
records should be maintained in order that the State agency may 
determine, for example, which of several methods of checking currently 
used are the most productive. Such records also will provide the basis 
for drawing a clear distinction between fraud and error.
    C. Does the agency take adequate action with respect to publicity 
concerning willful misrepresentation and its legal consequences to deter 
fraud by claimants?
    Explanation: To meet this criterion, the State agency must issue 
adequate material on claimant eligibility requirements and must take 
necessary action to obtain publicity on the legal consequences of 
willful misrepresentation or willful nondisclosure of facts.
    Public announcements on convictions and resulting penalties for 
fraud are generally considered necessary as a deterrent to other 
persons, and to inform the public that the agency is carrying on an 
effective program to prevent fraud. This alone is not considered 
adequate publicity. It is important that information be circulated which 
will explain clearly and understandably the claimant's rights, and the 
obligations which he must fulfill to be eligible for benefits. Leaflets 
for distribution and posters placed in local offices are appropriate 
media for such information.
    7515 Evaluation of Alternative State Provisions with Respect to 
Erroneous and Illegal Payments. If the methods of administration 
provided for by the State law do not conform to the suggested methods of 
meeting the requirements set forth in section 7511, but a State law does 
provide for alternative methods of administration designed to accomplish 
the same results, the Bureau of Employment Security, in collaboration 
with the State agency, will study the actual or anticipated effect of 
the alternative methods of administration. If the Bureau concludes that 
the alternative methods satisfy the criteria in section 7513, it will so 
notify the State agency. If the Bureau does not so conclude, it will 
submit to the Secretary the results of the study for his determination 
of whether the State's alternative methods of administration meet the 
criteria.

[55 FR 562, Jan. 5, 1990]



PART 626_INTRODUCTION TO THE REGULATIONS UNDER THE JOB TRAINING 
PARTNERSHIP ACT--Table of Contents



Sec.
626.1 Scope and purpose of the Job Training Partnership Act.
626.2 Format of the Job Training Partnership Act regulations.
626.3 Purpose, scope, and applicability of the Job Training Partnership 
          Act regulations.
626.4 Table of contents for the Job Training Partnership Act 
          regulations.
626.5 Definitions.

    Authority: 29 U.S.C. 1579(a).

    Source: 59 FR 45815, Sept. 2, 1994, unless otherwise noted.



Sec.  626.1  Scope and purpose of the Job Training Partnership Act.

    It is the purpose of the Job Training Partnership Act (JTPA or the 
Act) to establish programs to prepare youth and adults facing serious 
barriers to employment for participation in the labor force by providing 
job training and other services that will result in increased employment 
and earnings, increased educational and occupational skills, and 
decreased welfare dependency, thereby improving the quality of the work 
force and enhancing the productivity and competitiveness of the Nation 
(section 2).



Sec.  626.2  Format of the Job Training Partnership Act regulations.

    (a) Regulations promulgated by the Department of Labor to implement 
the provisions of the Act are set forth in parts 626 through 638 of 
title 20, chapter V, of the Code of Federal Regulations,

[[Page 181]]

with the exception of the veterans' employment program's chapter IX 
regulations of the Office of the Assistant Secretary for Veterans' 
Employment and Training, which are set forth at part 1005 of title 20.
    (b) Nondiscrimination and equal opportunity requirements and 
procedures, including complaint processing and compliance reviews, will 
be governed by the provisions of 29 CFR part 34 and will be administered 
by the Department of Labor (Department or DOL) Directorate of Civil 
Rights.
    (c) General authority for the JTPA regulations is found at section 
169 of the Act. Specific statutory authorities other than section 169 
are noted throughout the JTPA regulations.



Sec.  626.3  Purpose, scope, and applicability of the Job Training
Partnership Act regulations.

    (a) Parts 626 through 638 of this chapter and part 1005 of chapter 
IX (Veterans' employment programs under title IV, part C of the Job 
Training Partnership Act) establish the Federal programmatic and 
administrative requirements for JTPA grants awarded by the Department of 
Labor to eligible grant recipients.
    (b) Parts 626 through 638 of this chapter and part 1005 of chapter 
IX apply to recipients and subrecipients of JTPA funds.



Sec.  626.4  Table of contents for the Job Training Partnership Act 
regulations.

    The table of contents for the regulations under the Job Training 
Partnership Act, 20 CFR parts 626-638 and 1005, \1\ is as follows:
---------------------------------------------------------------------------

    \1\ Part 1005 was removed at 59 FR 26601, May 23, 1994.
---------------------------------------------------------------------------

    PART 626--INTRODUCTION TO THE REGULATIONS UNDER THE JOB TRAINING 
                             PARTNERSHIP ACT

Sec.
626.1 Scope and purpose of the Job Training Partnership Act.
626.2 Format of the Job Training Partnership Act regulations.
626.3 Purpose, scope and applicability of the Job Training Partnership 
          Act regulations.
626.4 Table of contents for the Job Training Partnership Act 
          regulations.
626.5 Definitions.

      PART 627--GENERAL PROVISIONS GOVERNING PROGRAMS UNDER THE ACT

                      Subpart A--Scope and Purpose

627.100 Scope and Purpose of Part 627.

                     Subpart B--Program Requirements

627.200 Governor/Secretary agreement.
627.205 Public service employment prohibition.
627.210 Nondiscrimination and nonsectarian activities.
627.215 Relocation.
627.220 Coordination with programs under title IV of the Higher 
          Education Act including the Pell grant program.
627.225 Employment generating activities.
627.230 Displacement.
627.235 General program requirements.
627.240 On-the-job training.
627.245 Work experience.
627.250 Interstate agreements.

   Subpart C--Payments, Supportive Services and Benefits and Working 
                               Conditions

627.300 Scope and purpose.
627.305 Payments.
627.310 Supportive Services.
627.315 Benefits and working conditions.

                   Subpart D--Administrative Standards

627.400 Scope and purpose.
627.405 Grant agreement and funding.
627.410 Reallotment and reallocation.
627.415 Insurance.
627.420 Procurement.
627.422 Selection of service providers.
627.423 Funding restrictions for ``high-risk'' recipients and 
          subrecipients.
627.424 Prohibition of subawards to debarred and suspended parties.
627.425 Standards for financial management and participant data systems.
627.430 Grant payments.
627.435 Cost principles and allowable costs.
627.440 Classification of costs.
627.445 Limitations on certain costs.
627.450 Program income.
627.455 Reports required.
627.460 Requirements for records.
627.463 Public access to records.
627.465 Property management standards.
627.470 Performance standards.
627.471 Reorganization plan appeals.
627.475 Oversight and monitoring.
627.477 Governor's determination of substantial violation.
627.480 Audits.
627.481 Audit resolution.
627.485 Closeout.
627.490 Later disallowances and adjustments after closeout.
627.495 Collection of amounts due.

[[Page 182]]

      Subpart E--Grievances Procedures at the State and Local Level

627.500 Scope and purpose.
627.501 State grievance and hearing procedures for noncriminal 
          complaints at the recipient level.
627.502 Grievance and hearing procedures for noncriminal complaints at 
          the SDA and SSG levels.
627.503 Recipient-level review.
627.504 Noncriminal grievance procedure at employer level.

    Subpart F--Federal Handling of Noncriminal Complaints and other 
                               Allegations

627.600 Scope and purpose.
627.601 Complaints and allegations at the Federal level.
627.602 Resolution of investigative findings.
627.603 Special handling of labor standards violations under section 143 
          of the Act.
627.604 Alternative procedure for handling labor standards violations 
          under section 143--Binding arbitration.
627.605 Special Federal review of SDA and SSG-level complaints without 
          decision.
627.606 Grant officer resolution.
627.607 Grant Officer resolution of Governor's failure to promptly take 
          action.

             Subpart G--Sanctions for Violations of the Act

627.700 Scope and purpose.
627.702 Sanctions and corrective actions.
627.703 Failure to comply with procurement provisions.
627.704 Process for waiver of State liability.
627.706 Process for advance approval of a recipient's contemplated 
          corrective actions.
627.708 Offset process.

     Subpart H--Hearings by the Office of Administrative Law Judges

627.800 Scope and purpose.
627.801 Procedures for filing request for hearing.
627.802 Rules of procedure.
627.803 Relief.
627.804 Timing of decisions.
627.805 Alternative dispute resolution.
627.806 Other authority.

                    Subpart I--Transition Provisions

627.900 Scope and purpose.
627.901 Transition period.
627.902 Governor's actions.
627.903 Actions which are at the discretion of the Governor.
627.904 Transition and implementation.
627.905 Guidance on contracts and other agreements.
627.906 Determinations on State and SDA implementation.

  PART 628--PROGRAMS UNDER TITLE II OF THE JOB TRAINING PARTNERSHIP ACT

                      Subpart A--Scope and Purpose

628.100 Scope and purpose of part 628.

                        Subpart B--State Planning

628.200 Scope and purpose.
628.205 Governor's coordination and special services plan.
628.210 State Job Training Coordinating Council.
628.215 State Human Resource Investment Council.

                        Subpart C--State Programs

628.300 Scope and purpose.
628.305 State distribution of funds.
628.310 Administration.
628.315 Education coordination and grants.
628.320 Services for older individuals.
628.325 Incentive grants, capacity building and technical assistance.

                Subpart D--Local Service Delivery System

628.400 Scope and purpose.
628.405 Service delivery areas.
628.410 Private Industry Council.
628.415 Selection of SDA grant recipient and administrative entity.
628.420 Job training plan.
628.425 Review and approval.
628.426 Disapproval or revocation of the plan.
628.430 State SDA submission.

 Subpart E--Program Design Requirements for Programs Under Title II of 
                    the Job Training Partnership Act

628.500 Scope and purpose.
628.505 Eligibility.
628.510 Intake, referrals, and targeting.
628.515 Objective assessment.
628.520 Individual service strategy.
628.525 Limitations.
628.530 Referrals of participants to non-title II programs.
628.535 Limitations on job search assistance.
628.540 Volunteer program.
628.545 Linkages and coordination.
628.550 Transfer of funds.

                      Subpart F--The Adult Program

628.600 Scope and purpose.
628.605 Eligibility.
628.610 Authorized services.

       Subpart G--The Summer Youth Employment and Training Program

628.700 Scope and purpose.
628.701 Program goals and objectives.
628.702 Enriched Educational Component.
638.703 Private Sector Summer Jobs.

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628.704 Eligibility.
628.705 SYETP authorized services.
628.710 Period of program operation.

                    Subpart H--Youth Training Program

628.800 Scope and purpose.
628.803 Eligibility.
628.804 Authorized services.

                        PARTS 629-630 [Reserved]

 PART 631--PROGRAMS UNDER TITLE III OF THE JOB TRAINING PARTNERSHIP ACT



                      Subpart A--General Provisions

631.1 Scope and purpose.
631.2 Definitions.
631.3 Participant eligibility.
631.4 Approved training rule.

 Subpart B--Additional Title III Administrative Standards and Procedures

631.11 Allotment and obligation of funds by the Secretary.
631.12 Reallotment of funds by the Secretary.
631.13 Classification of costs at State and substate levels.
631.14 Limitations on certain costs.
631.15 Federal reporting requirements.
631.16 Complaints, investigations, and penalties.
631.17 Federal monitoring and oversight.
631.18 Federal by-pass authority.
631.19 Appeals.

                    Subpart C--Needs-Related Payments

631.20 Needs-related payments.

                     Subpart D--State Administration

631.30 Designation or creation and functions of a State dislocated 
          worker unit or office and rapid response assistance.
631.31 Monitoring and oversight.
631.32 Allocation of funds by the Governor.
631.33 State procedures for identifying funds subject to mandatory 
          Federal reallotment.
631.34 Designation of substate areas.
631.35 Designation of substate grantees.
631.36 Biennial State plan.
631.37 Coordination activities.
631.38 State by-pass authority.

                        Subpart E--State Programs

631.40 State program operational plan.
631.41 Allowable State activities.

                      Subpart F--Substate Programs

631.50 Substate plan.
631.51 Allowable substate program activities.
631.52 Selection of service providers.
631.53 Certificate of continuing eligibility.

   Subpart G--Federal Delivery of Dislocated Worker Services Through 
                     National Reserve Account Funds

631.60 General.
631.61 Application for funding and selection criteria.
631.62 Cost limitations.
631.63 Reporting.
631.64 General Administrative Requirements.
631.65 Special Provisions for CAETA and DDP.

                          Subpart H [Reserved]

            Subpart I--Disaster Relief Employment Assistance

631.80 Scope and Purpose.
631.81 Availability of funds.
631.82 Substate allocation.
631.83 Coordination.
631.84 Allowable projects.
631.85 Participant eligibility.
631.86 Limitations on disaster relief employment.
631.87 Definitions.

  PART 632--INDIAN AND NATIVE AMERICAN EMPLOYMENT AND TRAINING PROGRAMS

                         Subpart A--Introduction

632.1 [Reserved]
632.2 Scope and purpose.
632.3 Format for these regulations.
632.4 Definitions.

   Subpart B--Designation Procedures for the Native American Grantees

632.10 Eligibility requirements for designation as a Native American 
          grantee.
632.11 Designation of Native American grantees.
632.12 Alternative arrangements for the provision of services, 
          nondesignation.
632.13 Review of denial of designation as a Native American grantee, or 
          rejection of a comprehensive annual plan.

  Subpart C--Program Planning, Application and Modification Procedures

632.17 Planning process.
632.18 Regional and national planning meetings.
632.19 Grant application content.
632.20 Submission of grant applications.
632.21 Application disapproval.
632.22 Modification of a Comprehensive Annual Plan (CAP) and/or Master 
          Plan.
632.23 Termination and corrective action of a CAP and/or Master Plan.

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           Subpart D--Administrative Standards and Procedures

632.31 General.
632.32 Financial management systems.
632.33 Audits.
632.34 Program income.
632.35 Native American grantee contracts and subgrants.
632.36 Procurement standards.
632.37 Allowable costs.
632.38 Classification of costs.
632.39 Administrative cost plan.
632.40 Administrative staff and personnel standards.
632.41 Reporting requirements.
632.42 Grant closeout procedures.
632.43 Reallocation of funds.
632.44 Sanctions for violation of the Act.

                Subpart E--Program Design and Management

632.70 Waiver of regulations under parts 632 and 636.
632.75 General responsibilities of Native American grantees.
632.76 Program management systems.
632.77 Participant eligibility determination.
632.78 Training activities.
632.79 Employment activities.
632.80 Other activities.
632.81 Payments to participants.
632.82 Benefits and working conditions for participants.
632.83 FICA.
632.84 Non-Federal status of participants.
632.85 Participant limitations.
632.86 Nondiscrimination and nonsectarian activities.
632.87 Equitable provision of services to the eligible population and 
          significant segments.
632.88 General responsibilities of the Department.
632.89 Performance standards.

            Subpart F--Prevention of Fraud and Program Abuse

632.115 General.
632.116 Conflict of interest.
632.117 Kickbacks.
632.118 Nepotism.
632.119 Political patronage.
632.120 Political activities.
632.121 Lobbying activities.
632.122 Unionization and antiunionization activities; work stoppages.
632.123 Maintenance of effort.
632.124 Theft or embezzlement from employment and training funds; 
          improper inducement; obstruction of investigations and other 
          criminal provisions.
632.125 Responsibilities of Native American grantees, subgrantees and 
          contractors for preventing fraud and program abuse and for 
          general program management.

                          Subpart G [Reserved]

Subpart H--Job Training Partnership Act Programs Under Title IV, Section 
                                   401

632.170 Eligibility for funds.
632.171 Allocation of funds.
632.172 Eligibility for participation in Title IV, Section 401.
632.173 Allowable program activities.
632.174 Administrative costs.

        Subpart I--Summer Youth Employment and Training Programs

632.250 General.
632.251 Eligibility for funds.
632.252 Allocation of funds.
632.253 Special operating provision.
632.254 Program startup.
632.255 Program planning.
632.256 Submission of applications.
632.257 Eligibility for participation.
632.258 Allowable activities.
632.259 Vocational exploration program.
632.260 Worksite standards.
632.261 Reporting requirements.
632.262 Termination date for the summer program.
632.263 Administrative costs.

           PART 633--MIGRANT AND SEASONAL FARMWORKER PROGRAMS

                   Subpart A--Introductory Provisions

633.102 Scope and purpose of Title IV, Section 402 programs.
633.103 Format for these regulations.
633.104 Definitions.
633.105 Allocation of funds.
633.106 Eligibility for allocable funds.
633.107 Eligibility for participation in Section 402 programs.

          Subpart B--Grant Planning and Application Procedures

633.201 Grant planning and application procedures in general.
633.202 Announcement of State planning estimates and invitation to 
          submit a grant application.
633.203 Review of funding request.
633.204 Responsibility review.
633.205 Notification of selection.

         Subpart C--Program Design and Administrative Procedures

633.301 General responsibilities.
633.302 Training activities and services.
633.303 Allowable costs.
633.304 Section 402 cost allocation.
633.305 General benefits and working conditions for program 
          participants.
633.306 Retirement benefits.
633.307 Packages of benefits.
633.308 Non-Federal status of participants.
633.309 Recordkeeping requirements.
633.310 Bonding.

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633.311 Management information systems.
633.312 Grantee contracts and subgrants.
633.313 Administrative staff and personnel standards.
633.314 Reports required.
633.315 Replacement, corrective action, termination.
633.316 Closeout procedures.
633.317 Reallocation of funds.
633.318 Nondiscrimination and nonsectarian activities.
633.319 Lobbying, political activities and unionization.
633.320 Nepotism.
633.321 Performance standards for Section 402 programs.
633.322 Sanctions for violation of the Act.

 PART 634--LABOR MARKET INFORMATION PROGRAMS UNDER TITLE IV, PART E OF 
                    THE JOB TRAINING PARTNERSHIP ACT

              Comprehensive Labor Market Information System

634.1 General.
634.2 Availability of funds.
634.3 Eligible recipients.
634.4 Statistical standards.
634.5 Federal oversight.

                           PART 635 [RESERVED]

           PART 636--COMPLAINTS, INVESTIGATIONS, AND HEARINGS

636.1 Scope and purpose.
636.2 Protection of informants.
636.3 Complaint and hearing procedures at the grantee level.
636.4 Grievance procedures at the employer level.
636.5 Exhaustion of grantee level procedure.
636.6 Complaints and investigations at the Federal level.
636.7 Subpoenas.
636.8 Initial and final determination; request for hearing at the 
          Federal level.
636.9 Opportunity for informal review.
636.10 Hearings before the Office of Administrative Law Judges.
636.11 Final action.

  PART 637--PROGRAMS UNDER TITLE V OF THE JOB TRAINING PARTNERSHIP ACT

                      Subpart A--General Provisions

Sec.
637.100 Scope and purpose.
637.105 Definitions.

                Subpart B--Program Planning and Operation

637.200 Allotments to States.
637.205 Notice of intent to participate.
637.210 Incentive bonus program applications.
637.215 Review and approval of applications for incentive bonus 
          payments.
637.220 Eligibility criteria for individuals to be counted in 
          determining incentive bonuses.
637.225 Determination of incentive bonus.
637.230 Use of incentive bonuses.

  Subpart C--Additional Title V Administrative Standards and Procedures

637.300 Management systems, reporting and recordkeeping.
637.305 Federal monitoring and oversight.
637.310 Audits.

                  Subpart D--Data Collection [Reserved]

    PART 638--JOB CORPS PROGRAM UNDER TITLE IV-B OF THE JOB TRAINING 
                             PARTNERSHIP ACT

                      Subpart A--Purpose and Scope

638.100 General.

                         Subpart B--Definitions

638.200 Definitions.

      Subpart C--Funding, Site Selection, and Facilities Management

638.300 Eligibility for funds and eligible deliverers.
638.301 Funding procedures.
638.302 Center performance measurement.
638.303 Site selection and facilities management.
638.304 Historical preservation.
638.305 Capital improvements.
638.306 Protection and maintenance of contract center facilities owned 
          or leased by Job Corps.
638.307 Facilities surveys.

 Subpart D--Enrollment, Transfers, Terminations, and Placements in the 
                                Job Corps

638.400 Eligibility for participation.
638.401 Outreach and screening of participants.
638.402 Enrollment by readmission.
638.403 Selective service.
638.404 Transfers.
638.405 Extensions of enrollment.
638.406 Federal status of students.
638.407 Terminations.
638.408 Transportation.
638.409 Placement and job development.

                      Subpart E--Center Operations

638.500 Orientation program.
694.501 Student handbook.
638.502 Job Corps basic education program.
638.503 Vocational training.
638.504 Occupational exploration programs.
638.505 Scheduling of training.
638.506 Purchase of vocational supplies and equipment.
638.507 Work experience.

[[Page 186]]

638.508 Sale of services or objects.
638.509 Leisure-time employment.
638.510 Health care and services.
638.511 Drug use and abuse.
638.512 Sexual behavior and harassment.
638.513 Death.
638.514 Residential support services.
638.515 Recreation/avocational program.
638.516 Laundry, mail, and telephone service.
638.517 Counseling.
638.518 Intergroup relations program.
638.519 Incentives system.
638.520 Student government and leadership program.
638.521 Student welfare associations.
638.522 Evaluation of student progress.
638.523 Food service.
638.524 Allowances and allotments.
638.525 Clothing.
638.526 Tort and other claims.
638.527 Federal employees' compensation.
638.528 Social Security.
638.529 Income taxes.
638.530 Emergency use of personnel, equipment, and facilities.
638.531 Limitations on the use of students in emergency projects.
638.532 Annual leave.
638.533 Other student absences.
638.534 Legal services to corpsmembers.
638.535 Voting rights.
638.536 Religious rights.
638.537 Disclosure of information.
694.538 Disciplinary procedures and appeals.
638.539 Complaints and disputes.
638.540 Cooperation with agencies and institutions.
638.541 Job Corps training opportunities.
638.542 Child care services.
638.543 Community relations program.

           Subpart F--Applied Vocational Skills Training (VST)

638.600 Applied vocational skills training (VST) through work projects.
638.601 Applied VST budgeting.

      Subpart G--Experimental, Research, and Demonstration Projects

638.710 Experimental, research, and demonstration projects.

                  Subpart H--Administrative Provisions

638.800 Program management.
638.801 Staff training.
638.802 Student records management.
638.803 Safety.
638.804 Environmental health.
638.805 Security and law enforcement.
638.806 Property management and procurement.
638.807 Imprest and petty cash funds.
638.808 Center financial management and reporting.
638.809 Audit.
638.810 Reporting requirements.
638.811 Review and evaluation.
638.812 State and local taxation of Job Corps deliverers.
638.813 Nondiscrimination, nonsectarian activities.
638.814 Lobbying; political activities; unionization.
638.815 Charging fees.

[59 FR 45815, Sept. 2, 1994, as amended at 60 FR 58229, Nov. 27, 1995]



Sec.  626.5  Definitions.

    In addition to the definitions contained in section 4 of the Act, 
the following definitions of terms used in the Act or parts 626-631 of 
this chapter apply as appropriate to programs under titles I, II, and 
III of the Act:
    Accrued expenditures means charges made to the JTPA program. 
Expenditures are the sum of actual cash disbursements, the amount of 
indirect expense incurred, and the net increase (or decrease) in the 
amounts owed by the recipient for the goods and other property received, 
for services performed by employees, contractors, subgrantees, 
subcontractors, and other payees, and other amounts becoming owed under 
programs for which no current services or performance are required, such 
as annuities, insurance claims, and other benefit payments.
    Act means the Job Training Partnership Act.
    ALJ means an administrative law judge in the Office of 
Administrative Law Judges of the U.S. Department of Labor.
    Awarding agency means: (1) With respect to a grant, the Department 
of Labor; and (2) with respect to a subgrant or contract, the party that 
awarded the subgrant or contract.
    Capacity building means the systematic improvement of job functions, 
skills, knowledge, and expertise of the personnel who staff and 
administer employment and training and other closely related human 
service systems. Capacity building is designed to enhance the 
effectiveness, to strengthen the caliber of customer services provided 
under the Act and other Federal, State, and local employment and 
training programs, and improve coordination among them. Capacity 
building includes curriculum development, appropriate training, 
technical assistance,

[[Page 187]]

staff development, and other related activities.
    Chief elected official (CEO) means the official or officials, or 
their representatives, of the jurisdiction or jurisdictions which 
requested designation by the Governor as a service delivery area.
    Commercial organizations means private for-profit entities.
    Commercially available off-the-shelf training package means a 
training package sold or traded to the general public in the course of 
normal business operations, at prices based on established catalog or 
market prices. To be considered as ``sold to the general public,'' the 
package must be regularly sold in sufficient quantities to constitute a 
real commercial market to buyers that must include other than JTPA 
programs. The package must include performance criteria pertaining to 
the delivery of the package which may include participant attainment of 
knowledge, skills or a job.
    Contractor means the organization, entity, or individual that is 
awarded a procurement contract under the recipient's or subrecipient's 
procurement standards and procedures.
    Cost means accrued expenditure.
    Department means the U.S. Department of Labor.
    DOL means the U.S. Department of Labor.
    ETA means the Employment and Training Administration of the U.S. 
Department of Labor.
    Family is defined at section 4(34) of the Act. An ``individual with 
a disability'' shall, for the purposes of income eligibility 
determination, be considered to be an unrelated individual who is a 
family unit of one, consistent with the definition of ``economically 
disadvantaged'' at section 4(8) of the Act. The Governor may provide 
interpretations of the term ``family'' related to how ``dependent 
children'' are defined for programs within a State, consistent with the 
Act, and all applicable rules and regulations, and State or local law. 
Such interpretations by the Governor may address the treatment of 
certain individuals who may need to be viewed discretely in the income 
eligibility determination process, such as runaways, emancipated youth, 
and court adjudicated youth separated from the family.
    The phrase ``living in a single residence'' with other family 
members includes temporary, voluntary residence elsewhere (e.g., 
attending school or college, or visiting relatives). It does not include 
involuntary temporary residence elsewhere (e.g., incarceration, or 
placement as a result of a court order).
    Family income means ``income'' as defined by the Department of 
Health and Human Services in connection with the annual poverty 
guidelines. Such income shall not include unemployment compensation, 
child support and public assistance (including Aid to Families with 
Dependent Children, Supplemental Security Income, Emergency Assistance 
money payments, and non-federally funded General Assistance or General 
Relief money payments), as provided for at section 4(8) of the Act. In 
addition, such income shall also exclude foster child care payments, 
educational financial assistance received under title IV of the Higher 
Education Act (20 U.S.C. 1087), as amended by section 479(B) of the 
Higher Education Act Amendments of 1992), needs-based scholarship 
assistance, and income earned while on active military duty and other 
benefit payments specified at 38 U.S.C. 4213, items (1) and (3). The 
Governor may, for the purposes of determining income eligibility for 
services to older individuals under section 204(d)(5) of the Act, 
exclude up to 25 percent of Social Security and Old Age Survivors' 
Insurance benefit payments under title II of the Social Security Act, 
(42 U.S.C., section 401, et seq.) from the definition of family income. 
In addition, when a Federal statute specifically provides that income or 
payments received under such statute shall be excluded in determining 
eligibility for and the level of benefits received under any other 
federal statute, such income or payments shall be excluded in JTPA 
eligibility determinations.
    Funding period means the period of time when JTPA funds are 
available for expenditure. Unless a shorter period of time is specified 
in a title III discretionary award, the JTPA funding period is the 3-
year period specified in JTPA section 161(b); the program year

[[Page 188]]

in which Federal funds are obligated to the recipient, and the two 
succeeding program years.
    Governor means, in addition to the definition at section 4(9) of the 
Act, the recipient of JTPA funds awarded to the State under titles I 
through III.
    Grant means an award of JTPA financial assistance by the U.S. 
Department of Labor to an eligible JTPA recipient. (Also, see Sec.Sec. 
627.405 and 627.430 of these regulations).
    Grantee means the recipient.
    Individual service strategy (ISS) is defined inSec. 628.520 of 
this chapter.
    Job search assistance (also including job search skills training and 
job club activities) means the provision of instruction and support to a 
participant to give the participant skills in acquiring full time 
employment. The services provided may include, but are not limited to, 
resume writing, interviewing skills, labor market guidance, telephone 
techniques, information on job openings, and job acquisition strategies, 
as well as the provision of office space and supplies for the job 
search.
    Job Training Partnership Act means Public Law (Pub. L.) 97-300, as 
amended, 29 U.S.C. 1501, et seq.
    JTPA means the Job Training Partnership Act.
    Nontraditional employment, as applied to women, means occupations or 
fields of work where women comprise less than 25 percent of the 
individuals employed in such occupation or field of work as provided 
periodically by the Department in the Federal Register. (Pub. L. 102-
235, Nontraditional Employment for Women Act).
    OALJ means the Office of Administrative Law Judges of the U.S. 
Department of Labor.
    Obligations means the amounts of orders placed, contracts and 
subgrants awarded, goods and services received, and similar transactions 
during a funding period that will require payment by the recipient or 
subrecipient during the same or a future period.
    OIG means the Office of Inspector General of the U.S. Department of 
Labor.
    PIC means a private industry council.
    Participant means an individual who has been determined to be 
eligible to participate in and who is receiving services (except post-
termination services authorized under sections 204(c)(4) and 264(d)(5) 
and followup services authorized under section 253(d)) under a program 
authorized by the JTPA. Participation shall be deemed to commence on the 
first day, following determination of eligibility, on which the 
participant began receiving subsidized employment, training, or other 
services provided under the JTPA. (section 4(37)).
    Program year means the 12-month period beginning July 1 of the 
indicated year.
    Recipient means the entity to which a JTPA grant is awarded directly 
from the Department of Labor to carry out the JTPA program. The 
recipient is the entire legal entity that received the award and is 
legally responsible for carrying out the JTPA program, even if only a 
particular component of the entity is designated in the grant award 
document. For JTPA grants under titles I, II and III, except for certain 
discretionary grants awarded under title III, part B, the State is the 
recipient.
    SDA means a service delivery area designated by the Governor 
pursuant to section 101(a)(4) of the Act. As used in these regulations, 
SDA may also refer to the entity that administers the JTPA program 
within the designated area.
    SDA grant recipient means the entity that receives JTPA funds for a 
service delivery area directly from the recipient.
    Secretary means the Secretary of Labor, U.S. Department of Labor, or 
his or her designee.
    Section, as used in this chapter, means a section of the Act unless 
the text specifically indicates otherwise.
    Service provider means a public agency, private nonprofit 
organization, or private-for-profit entity that delivers educational, 
training, employment or supportive services to JTPA participants. Awards 
to service providers may be made by subgrant, contract, subcontract, or 
other legal agreement.
    Stand-in costs means costs paid from non-Federal sources that a 
recipient proposes to substitute for Federal costs that have been 
disallowed as a result of an audit or other review. In order to be

[[Page 189]]

considered as valid substitutions, the costs (1) shall have been 
reported by the grantee as uncharged program costs under the same title 
and in the same program year in which the disallowed costs were incurred 
(2) shall have been incurred in compliance with laws, regulations, and 
contractual provisions governing JTPA, and (3) shall not result in a 
violation of the applicable cost limitations.
    State is defined at section 4(22) of the Act. For cash payment 
purposes, the definition of ``State'' contained in the Department of the 
Treasury regulations at 31 CFR 205.3 shall apply to JTPA programs.
    State council means the State Job Training Coordinating Council 
(SJTCC) or, in a State with a Human Resource Investment Council (HRIC) 
pursuant toSec. 628.215 of this chapter, the HRIC.
    Subgrant means an award of JTPA financial assistance in the form of 
money, or property in lieu of money, made under a grant by a recipient 
to an eligible subrecipient. It also means a subgrant award of JTPA 
financial assistance by a subrecipient to a lower tier subrecipient. The 
term includes financial assistance when provided by any legal agreement, 
even if the agreement is called a contract, but does not include 
procurement purchases from vendors nor does it include any form of 
assistance received by program participants.
    Subgrantee means a subrecipient.
    Subrecipient means the legal entity to which a subgrant is awarded 
and which is accountable to the recipient (or higher tier subrecipient) 
for the use of the funds provided. For JTPA purposes, distinguishing 
characteristics of a subrecipient include items such as determining 
eligibility of applicants, enrollment of participants, performance 
measured against meeting the objectives of the program, responsibility 
for programmatic decisionmaking, responsibility for compliance with 
program requirements, and use of the funds awarded to carry out a JTPA 
program or project, as compared to providing goods or services for a 
JTPA program or project (vendor). Depending on local circumstances, the 
PIC, local elected official, or administrative entity may be a 
subrecipient. SDA grant recipients and JTPA title III substate grantees 
are particular types of subrecipients.
    Substate grantee (SSG) means that agency or organization selected to 
administer programs pursuant to section 312(b) of the Act. The substate 
grantee is the entity that receives JTPA title III funds for a substate 
area directly from the Governor.
    Technical assistance is a facet of capacity building which may 
include but is not limited to information sharing, dissemination and 
training on program models and job functions; peer-to-peer networking 
and problem solving; guides; and interactive communication technologies.
    Title, as used in this chapter, means a title of the Act, unless the 
text of the regulation specifically indicates otherwise.
    Vendor means an entity responsible for providing generally required 
goods or services to be used in the JTPA program. These goods or 
services may be for the recipient's or subrecipient's own use or for the 
use of participants in the program. Distinguishing characteristics of a 
vendor include items such as: Providing the goods and services within 
normal business operations; providing similar goods or services to many 
different purchasers, including purchasers outside the JTPA program; and 
operating in a competitive environment. A vendor is not a subrecipient 
and does not exhibit the distinguishing characteristics attributable to 
a subrecipient, as defined above. Any entity directly involved in the 
delivery of program services not available to the general public, with 
the exception of an employer providing on-the-job training, shall be 
considered a subrecipient rather than a vendor.
    Wagner-Peyser Act means 29 U.S.C. 49, et seq.

[59 FR 45815, Sept. 2, 1994, as amended at 61 FR 19983, May 3, 1996]



PART 627_GENERAL PROVISIONS GOVERNING PROGRAMS UNDER TITLES I, II,
AND III OF THE ACT--Table of Contents



                       Subpart A_Scope and Purpose

Sec.
627.100 Scope and purpose of this part 627.

[[Page 190]]

                     Subpart B_Program Requirements

627.200 Governor/Secretary agreement.
627.201 Waivers.
627.205 Public service employment prohibition.
627.210 Nondiscrimination and nonsectarian activities.
627.215 Relocation.
627.220 Coordination with programs under title IV of the Higher 
          Education Act including the Pell grant program.
627.225 Employment generating activities.
627.230 Displacement.
627.235 General program requirements.
627.240 On-the-job training.
627.245 Work experience.
627.250 Interstate agreements.

   Subpart C_Payments, Supportive Services, and Benefits and Working 
                               Conditions

627.300 Scope and purpose.
627.305 Payments.
627.310 Supportive services.
627.315 Benefits and working conditions.

                   Subpart D_Administrative Standards

627.400 Scope and purpose.
627.405 Grant agreement and funding.
627.410 Reallotment and reallocation.
627.415 Insurance.
627.420 Procurement.
627.422 Selection of service providers.
627.423 Funding restrictions for ``high-risk'' recipients and 
          subrecipients.
627.424 Prohibition of subawards to debarred and suspended parties.
627.425 Standards for financial management and participant data systems.
627.430 Grant payments.
627.435 Cost principles and allowable costs.
627.440 Classification of costs.
627.445 Limitations on certain costs.
627.450 Program income.
627.455 Reports required.
627.460 Requirements for records.
627.463 Public access to records.
627.465 Property management standards.
627.470 Performance standards.
627.471 Reorganization plan appeals.
627.475 Oversight and monitoring.
627.477 Governor's determination of substantial violation.
627.480 Audits.
627.481 Audit resolution.
627.485 Closeout.
627.490 Later disallowances and adjustments after closeout.
627.495 Collection of amounts due.

      Subpart E_Grievances Procedures at the State and Local Level

627.500 Scope and purpose.
627.501 State grievance and hearing procedures for noncriminal 
          complaints at the recipient level.
627.502 Grievance and hearing procedures for noncriminal complaints at 
          the SDA and SSG levels.
627.503 Recipient-level review.
627.504 Noncriminal grievance procedure at employer level.

     Subpart F_Federal Handling of Noncriminal Complaints and Other 
                               Allegations

627.600 Scope and purpose.
627.601 Complaints and allegations at the Federal level.
627.602 Resolution of investigative findings.
627.603 Special handling of labor standards violations under section 143 
          of the Act.
627.604 Alternative procedure for handling labor standards violations 
          under section 143--binding arbitration.
627.605 Special Federal review of SDA- and SSG-level complaints without 
          decision.
627.606 Grant Officer resolution.
627.607 Grant Officer resolution of Governor's failure to promptly take 
          action.

              Subpart G_Sanctions for Violations of the Act

627.700 Purpose and scope.
627.702 Sanctions and corrective actions.
627.703 Failure to comply with procurement provisions.
627.704 Process for waiver of State liability.
627.706 Process for advance approval of a recipient's contemplated 
          corrective actions.
627.708 Offset process.

      Subpart H_Hearings by the Office of Administrative Law Judges

627.800 Scope and purpose.
627.801 Procedures for filing request for hearing.
627.802 Rules of procedure.
627.803 Relief.
627.804 Timing of decisions.
627.805 Alternative dispute resolution.
627.806 Other authority.

                     Subpart I_Transition Provisions

627.900 Scope and purpose.
627.901 Transition period.
627.902 Governor's actions.
627.903 Actions which are at the discretion of the Governor.
627.904 Transition and implementation.
627.905 Guidance on contracts and other agreements.
627.906 Determinations on State and SDA implementation.


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    Authority: 29 U.S.C. 1579(a); Sec. 6305(f), Pub. L. 100-418, 102 
Stat. 1107; 29 U.S.C. 1791i(e).

    Source: 59 FR 45821, Sept. 2, 1994, unless otherwise noted.



                       Subpart A_Scope and Purpose



Sec.  627.100  Scope and purpose of this part 627.

    (a) This part sets forth requirements for implementation of programs 
under titles I, II, and III of the Job Training Partnership Act.
    (b) Subpart B provides general program requirements that apply to 
all programs under the titles I, II, and III of the Act, except as 
provided elsewhere in the Act or this chapter. These requirements 
include the Governor/Secretary agreement, the nondiscrimination and 
nonsectarian activity provisions, coordination provisions with Higher 
Education Act programs, and the prohibitions on public service 
employment, relocation assistance, displacement, and employment 
generating activities. This subpart also sets forth comprehensive rules 
for on-the-job training for JTPA participants as well as for work 
experience.
    (c) Subpart C sets forth requirements for allowable payments to JTPA 
participants.
    (d) Subpart D establishes the administrative and financial standards 
and requirements that apply to funds received under the Act.
    (e) Subpart E establishes the procedures that apply to the handling 
of noncriminal complaints under the Act at the Governor, the SDA, and 
title III SSG levels.
    (f) Subpart F establishes the procedures that apply to the filing, 
handling, and review of complaints at the Federal level.
    (g) Subpart G sets forth the provisions that apply to the sanctions 
and corrective actions that may be imposed by the Secretary for 
violations of the Act, regulations, or grant terms and conditions.
    (h) Subpart H sets forth procedures that apply to hearing by the 
Office of the Administrative Law Judges.



                     Subpart B_Program Requirements



Sec.  627.200  Governor/Secretary agreement.

    (a)(1) To establish a continuing relationship under the Act, the 
Governor and the Secretary shall enter into a Governor/Secretary 
agreement. The agreement shall consist of a statement assuring that the 
State shall comply with (i) the Job Training Partnership Act and all 
applicable rules and regulations and (ii) the Wagner-Peyser Act and all 
applicable rules and regulations. The agreement shall specify that 
guidelines, interpretations, and definitions, adopted and issued by the 
Governor and identified pursuant to section 124 of the Act, shall, to 
the extent that they are consistent with the Act and applicable rules 
and regulations, be accepted by the Secretary.
    (2) Either the Governor or the Secretary may seek a modification, 
revision, or termination of the agreement at any time, to be effective 
at the end of a program year.
    (b) Except as provided at part B of title III of the Act and part 
631, subpart G, of this chapter, the State shall be the grant recipient 
of JTPA funds awarded under titles I, II, and III.



Sec.  627.201  Waivers.

    (a)(1) The Governor may request, and the Secretary may grant, a 
waiver of specific provisions of these regulations to the extent that 
such request is consistent with the provisions of the Act.
    (2) In requesting a waiver under paragraph (a)(1) of this section, 
the Governor shall demonstrate how it will either improve the targeting 
of services to the hard to serve, increase the level of basic and 
occupational skills training provided by the JTPA program in the State, 
contribute to the provision of academic enrichment services to youth, 
promote coordination of JTPA programs with other human resource 
programs, or substantially improve the job placement outcomes of the 
JTPA program.
    (3) Waivers granted by the Secretary shall be effective for no more 
than four years from the date the waiver is granted.

[[Page 192]]



Sec.  627.205  Public service employment prohibition.

    No funds available under titles I, II-A, II-C, or III-A of the Act 
may be used for public service employment (sections 141(p) and 
314(d)(2)).



Sec.  627.210  Nondiscrimination and nonsectarian activities.

    (a)(1) Recipients, SDA grant recipients, title III substate 
grantees, and other subrecipients shall comply with the 
nondiscrimination provisions of section 167 of the Act.
    (2) Nondiscrimination and equal opportunity requirements and 
procedures, including complaint processing and compliance reviews, are 
governed by the provisions of 29 CFR part 34 and are administered and 
enforced by the DOL Directorate of Civil Rights.
    (3) Funds may be used to meet a recipient's or subrecipient's 
obligation to provide physical and programmatic accessibility and 
reasonable accommodation in regard to the JTPA program as required by 
Section 504 of the Rehabilitation Act of 1973, as amended, and the 
Americans with Disabilities Act of 1990.
    (b) The employment or training of participants in sectarian 
activities is prohibited.



Sec.  627.215  Relocation.

    (a) No funds provided under the Act shall be used, or proposed for 
use, to encourage or to induce the relocation of an establishment, or 
part thereof, that result in the loss of employment for any employee or 
such establishment at the original location.
    (b) For 120 days after the commencement or the expansion of 
commercial operations of a relocating establishment, no funds provided 
under this Act shall be used for customized or skill training, on-the-
job training, or company-specific assessments of job applicants or 
employees, for any relocating establishment or part thereof at a new, or 
expanded location, if the relocation of such establishment or part 
thereof results in a loss of employment for any employee of such 
establishment at the original location.
    (c) For the purposes of this section, relocating establishment means 
a business entity, including a successor-in-interest, which is moving 
any operations from a facility in one labor market area within the 
United States and its territories to a new or expanding facility in 
another labor market area. For the purposes of this section, a labor 
market area is an area within which individuals can readily change 
employment without changing their place of residence.
    (d) Pre-award review. To verify that an establishment which is new 
or expanding is not, in fact, relocating employment from another area, 
standardized pre-award review procedures developed by the State shall be 
completed and documented jointly by the service delivery area or 
substate grantee and the establishment as a prerequisite to JTPA 
assistance. The review should include names under which the 
establishment does business, including successors-in-interest; the name, 
title, and address of the company official certifying the information; 
the name and address of the facility in the other geographic location 
which is being closed or from which business is being transferred; a 
statement from the employer about job losses at that location; the 
nature of the products or business being transferred; the date the 
facility will commence or expand operations, and whether JTPA assistance 
is sought in connection with past or impending job losses at other 
facilities.
    (e) Violations and sanctions. The Department will promptly review 
and take appropriate action with regard to alleged violations of the 
provisions of paragraphs (a) and (b) of this section. Procedures for the 
investigation and resolution of the violations are provided for under 
subpart F of this part. Sanctions and remedies are provided for under 
subpart G of this part.



Sec.  627.220  Coordination with programs under title IV of the Higher
Education Act including the Pell grant program.

    (a) Coordination. Financial assistance programs under title IV of 
the Higher Education Act of 1965, as amended (HEA) (the Pell Grant 
program, the Supplemental Education Opportunity Grant program, the Work-
study program, and Federal loan programs such as Federal Perkins Loans. 
Federal

[[Page 193]]

Stafford Loans and Federal Direct Stafford Loans) provide student 
financial aid and are available to JTPA participants enrolling in 
postsecondary level education programs. SDA's and title III SSG's shall 
establish coordination procedures and contractual safeguards to ensure 
that JTPA funds are used in addition to funds otherwise available in the 
area and are coordinated with these funding sources.
    (b) Affordable programs. (1) The SDA shall assist the participant 
early in the objective assessment, as appropriate, to establish 
eligibility for Pell Grants, student loans and other forms of financial 
aid.
    (2) The SDA or SSA shall record in the ISS or participant record the 
participant's training-related financial assistance needs and the mix of 
JTPA and other funds, including Pell Grant funds (sections 141(b), 
107(b), 205(b) and 265(b)).
    (3) The SDA shall ensure, to the extent practicable, that available 
Federal, State, and local resources are coordinated sufficiently to meet 
the training and education-related costs of services, so that the 
participant can afford to complete the agreed-upon program successfully.
    (4) Participants shall not be required to apply for or access 
student loans, or incur personal debt as a condition of JTPA 
participation.
    (c) Information sharing. To prevent duplication of funding and to 
streamline the tracking of the participant's financial needs and use of 
funds when HEA, title IV programs are involved, contracts and agreements 
with educational institutions shall require the educational 
institution's financial aid officer to inform the SDA's/SSG's of the 
amounts and disposition of any HEA, title IV awards and other types of 
financial aid to each JTPA participant awarded after the enrollment of 
the participant, as part of a continuing, regular information sharing 
process (section 141(b)).



Sec.  627.225  Employment generating activities.

    (a)(1) No funds available under the Act shall be used for employment 
generating activities, economic development activities, investment in 
revolving loan funds, capitalization of businesses, investment in 
contract bidding resource centers, or similar activities.
    (2) No funds available under titles I, II, or III of the Act shall 
be used for foreign travel for employment generating activities, 
economic development activities, or similar activities.
    (b) JTPA funds may be used for normal employer outreach and job 
development activities including, but not limited to: contacts with 
potential employers for the purpose of placement of JTPA participants; 
participation in business associations (such as chambers of commerce); 
JTPA staff participation on economic development boards and commissions, 
and work with economic development agencies, to provide information 
about JTPA and to assist in making informed decisions about community 
job training needs; subscriptions to relevant publications; general 
dissemination of information on JTPA programs and activities; labor 
market surveys; and development of on-the-job training (OJT) 
opportunities, as defined inSec. 627.240; and other allowable JTPA 
activities in the private sector.



Sec.  627.230  Displacement.

    (a) No currently employed worker shall be displaced by any 
participant (including partial displacement such as a reduction in the 
hours of nonovertime work, wages, or employment benefits).
    (b) No participant shall be employed or job opening filled: (1) When 
any other individual is on layoff from the same or any substantially 
equivalent job, or
    (2) When the employer has terminated any regular employee without 
cause or otherwise reduced its workforce with the intention of filling 
the vacancy so created by hiring a participant whose wages are 
subsidized under the Act.
    (c) Violations and sanctions. The Department will promptly review 
and take appropriate action with regard to alleged violations of the 
provisions of paragraphs (a) and (b) of this section. Procedures for the 
investigation and resolution of violations are provided

[[Page 194]]

for under subpart F of this part. Sanctions and remedies are provided 
for under subpart G of this part.



Sec.  627.235  General program requirements.

    (a) The requirements set forth in sections 141, 142 and 143 of the 
Act apply to all programs under titles I, II, and III of the Act, except 
as provided elsewhere in the Act.
    (b) Recipients shall ensure that an individual enrolled in a JTPA 
program meets the requirements of section 167(a)(5) of the Act, Section 
3 of the Military Selective Service Act (50 U.S.C. App. 453) and other 
requirements applicable to programs funded under the specific section or 
title of the Act under which the participant is enrolling (section 604).
    (c) Recipients shall ensure that individuals are enrolled within 45 
days of the date of eligibility determination or a new eligibility 
determination (including new application, if necessary) shall be made, 
except that eligible summer program applicants under title II-B may be 
enrolled within 45 days into a summer youth enrollee pool, and no 
subsequent eligibility determination need be made prior to participation 
during the period of that summer program. In addition, the 45-day 
enrollment requirement shall not apply for individuals who have a valid 
certificate of continuing eligibility under the title III program, as 
described inSec. 631.3 andSec. 631.53 of this chapter.
    (d) Programs operated under titles I, II, and III of the Act are not 
subject to the provisions of 29 CFR part 97, ``Uniform Administrative 
Requirements for Grants and Cooperative Agreements to State and Local 
Governments,'' except as otherwise explicitly provided in this chapter.
    (e) If a recipient or SDA imposes a requirement that is in addition 
to the provisions of the Act and these regulations relating to the 
administration and operation of programs funded by the Act, the 
recipient or SDA shall identify the requirement as a State- or SDA-
imposed requirement (section 124).



Sec.  627.240  On-the-job training.

    (a) General--(1) On-the-job training (OJT) means training by an 
employer in the private or public sector given to a participant who, 
after objective assessment, and in accordance with the ISS, has been 
referred to and hired by the employer following the development of an 
agreement with the employer to provide occupational training in exchange 
for reimbursement of the employer's extraordinary costs. On-the-job 
training occurs while the participant is engaged in productive work 
which provides knowledge and skills essential to the full and adequate 
performance of the job.
    (2) This does not preclude a participant who has been trained by one 
employer from ultimately being placed in a comparable training-related 
position with another employer.
    (3) On-the-job training may be sequenced with or accompanied by 
other types of training such as classroom training or literacy training.
    (b) Duration of OJT. (1) OJT authorized for a participant shall be 
limited to a period not in excess of that required for the participant 
to acquire the skills needed for the OJT position. Except as described 
in paragraph (b) (3) of this section, the period of reimbursement to the 
employer under an OJT agreement shall not exceed 6 months of training.
    (2) The 6-month duration of OJT may be expressed as a number of 
hours, days, or weeks the participant is expected to work in a 6-month 
period if the participant works full-time.
    (3) In the event that a participant's regular employment is less 
than full-time and less than 500 hours of OJT has occurred by the end of 
6 months, that participant may remain in OJT until 499 hours OJT hours 
have occurred.
    (4)(i) Recipients shall develop policies and procedures for 
determining the average training duration for occupations including to 
reflect an individual participant's need for additional training time, 
or reduction in training time to reflect the individual participant's 
partial acquisition of needed skills. (In no case should an individual 
who is fully skilled in an occupation be placed in OJT in that 
occupation.)

[[Page 195]]

    (ii) In determining the average training time, consideration should 
be given to recognized reference materials, such as the ``Dictionary of 
Occupational Titles'' (DOT) and employer training plans. Such materials 
need not be limited to the DOT, however.
    (5) On-the-job training is encouraged, but not required, in all 
occupations with significant training content, particularly in higher-
skill occupations appropriate to the participant's needs. Training plans 
may be developed that recognize the full duration of the OJT period 
necessary for the full and adequate performance of the job, but the 
period of reimbursement may not exceed the duration in paragraph (a)(1) 
or (a)(2) of this section.
    (6) When the OJT period in a given occupation for a participant for 
whom the ISS identifies OJT as appropriate varies from the average for 
that occupation, the basis for the variation shall be recorded in the 
ISS.
    (c) On-the-job training payments to employers. (1) On-the-job 
training payments to employers are deemed to be in compensation for the 
extraordinary costs associated with training participants and in 
compensation for the costs associated with the lower productivity of 
such participants. Employers shall not be required to document such 
extraordinary costs or lower productivity (section 141(g)(1)).
    (2)(i) On-the-job training payments to employers shall not, during 
the period of such training, average more than 50 percent of the wages 
paid by the employer to OJT participants.
    (ii) On-the-job training payments to employers may be based upon 
scheduled raises or regular pay increases.
    (iii) On-the-job training payments may not be based on overtime, 
shift differential, premium pay and other nonregular wages paid by the 
employer to participants.
    (iv) On-the-job training payments may not be based upon periods of 
time such as illness, holidays, plant downtime or other events in which 
no training occurs.
    (3) Employers which provide classroom or vestibule training to meet 
the specific training needs of JTPA participants to equip them with 
education and knowledge necessary to the OJT occupation may be 
separately reimbursed for training costs, such as instructors and 
training material.
    (d) On-the-job training agreements. (1) Each OJT agreement shall, at 
a minimum, specify the occupation(s) for which training is to be 
provided, the duration of the training, the number of participants to be 
trained in each occupation, wage rates to be paid, the rate of 
reimbursement, the maximum amount of reimbursement, a job description or 
training outline that reflects what the participant will learn, and any 
other separate classroom training that may be provided.
    (2) The agreement shall provide that the employer will maintain and 
make available time and attendance, payroll and other records to support 
amounts reimbursed under OJT contracts.
    (e) Labor standards. OJT participants shall be compensated by the 
employer at the same rates, including periodic increases, as similarly 
situated employees, but in no event less than the higher of the minimum 
wage specified under the Fair Labor Standards Act of 1938, as amended or 
the applicable State or local minimum wage. Participants must receive 
the same benefits and have the same working conditions as similarly 
situated employees.
    (f) Suitability of participants. (1) Only those participants who 
have been assessed and for whom OJT has been determined as an 
appropriate activity in the participant's ISS may be referred to an 
employer for participation in OJT.
    (2) An individual referred to the JTPA program by an employer may be 
enrolled in an OJT program with such employer only upon completion of 
the objective assessment and individual service strategy in which OJT 
with such employer has been determined to be an appropriate activity and 
only if the employer has not already hired such individual.
    (3) OJT with the participant's previous or current employer in the 
same, a similar, or an upgraded job is not permitted.
    (g) Monitoring. (1) OJT agreements shall be monitored periodically 
on-site by the entity issuing the contract to assure that the validity 
and propriety of amounts claimed for reimbursement

[[Page 196]]

are substantiated by payroll and time and attendance records and that 
the training is being provided as specified in the agreement.
    (2) Brokering contractors shall conduct on-site monitoring of the 
OJT employers and other subcontractors to verify compliance with 
subcontract terms before making payments.
    (3) Nothing in this paragraph (g) shall relieve recipients and SDA's 
from responsibility for monitoring expenditures under the Act.
    (h) Employer eligibility. (1) OJT agreements shall not be entered 
into with employers which, under previous agreements, have exhibited a 
pattern of failing to provide OJT participants with continued long-term 
employment as regular employees with wages, benefits and working 
conditions at the same level and to the same extent as similarly 
situated employees. This prohibition does not apply to OJT agreements 
for youth in the program under title II-B who are returning to school.
    (2) Governors shall issue procedures and criteria to implement the 
requirement in paragraph (h)(1) of this section, which shall specify the 
duration of the period of loss of eligibility. The procedures and 
criteria shall provide that situations in which OJT participants quit 
voluntarily, are terminated for cause, or are released due to 
unforeseeable changes in business conditions will not necessarily result 
in termination of employer eligibility.
    (i) Brokered OJT. Each agreement with an OJT employer that is 
written by a brokering contractor (not written directly by the SDA/SSA 
or recipient) shall specify and clearly differentiate the services to be 
provided by the brokering contractor (including but not limited to 
outreach, recruitment, training, counseling, assessment, placement, 
monitoring, and followup), the employer and other agencies and 
subcontractors, including services provided with or without cost by 
other agencies or subcontractors.
    (j) Youth OJT. OJT conducted under title II-C shall meet the 
requirements of subpart H of part 628 of this chapter (628.804), as well 
as the requirements of this section. Where OJT is provided to youth 
concurrently enrolled under titles II-B and II-C, the source of funding 
for the OJT shall govern which requirements apply.
    (k) Employment and employee leasing agencies--(1) Definition. The 
terms employment agency and employee leasing agency mean an employer 
that provides regular, on-going employment (i.e., not probationary, 
temporary, or intermittent employment) in a specific occupation and, for 
a fee, places employees at the worksite of another employer to perform 
work for such employer.
    (2) Employment and employee leasing agencies that meet the other 
requirements of this section may be eligible for OJT agreements when the 
agreement specifies the source of training and specifies that the 
payments are for the extraordinary training costs of the entity 
providing the training.



Sec.  627.245  Work experience.

    (a) Definition. Work experience means a short-term or part-time 
training assignment with a public or private nonprofit organization for 
a participant who needs assistance in becoming accustomed to basic work 
requirements. It is prohibited in the private for-profit sector.
    (b) Suitability. Work experience should be designed to promote the 
development of good work habits and basic work skills.
    (c) Duration of work experience. Participation in work experience 
shall be for a reasonable length of time, based on the needs of the 
participant. The duration of work experience shall be recorded in the 
participant's ISS.
    (d) Combination with other services. Work experience under titles 
II-A and C shall be accompanied either concurrently or sequentially by 
other services designed to increase the basic education and/or 
occupational skills of the participant, as recorded in the ISS.
    (e) Work experience is not an allowable activity under title III of 
the Act. (Sections 204(b) and (c), 253(a), and 264 (c) and (d).)



Sec.  627.250  Interstate agreements.

    The Secretary hereby grants authority to the several States to enter 
into interstate agreements and compacts in accordance with section 127 
of the Act and, as specified inSec. 627.420(g), Procurement.

[[Page 197]]



   Subpart C_Payments, Supportive Services, and Benefits and Working 
                               Conditions



Sec.  627.300  Scope and purpose.

    This subpart sets forth requirements for allowable payments to JTPA 
participants under titles I and II. These include needs-based payments 
under title II, incentive and bonus payments under title II, work-based 
training payments under title II, and payments for combined activities 
under title II. Requirements for supportive services under titles I, II, 
and III, including financial assistance and needs-related payments, are 
also included in this subpart. This subpart also sets forth rules for 
benefits and working conditions for JTPA participants. These include 
requirements for: Compliance with applicable labor laws; workers' 
compensation coverage or medical and accident insurance where there is 
no State workers' compensation coverage; and working conditions which 
are not detrimental to the participant's health and safety.



Sec.  627.305  Payments.

    (a)(1) General. Allowable types of payments which may be made to 
participants are: Needs-based payments for eligible individuals in 
programs under title II; incentive and bonus payments for participants 
in title II programs; work-based training payments for work experience, 
entry employment experience, internships and other work-based training 
activities; payments for participants in title II-B activities; and 
training payments for combined activities in title II programs. These 
payments shall be made in accordance with paragraphs (b) through (f) of 
this section.
    (2) A participant shall receive no payments for training activities 
in which the participant fails to participate without good cause 
(section 142(a)(1)).
    (3) The SDA shall ensure to the extent possible that similarly 
situated participants receive similar payments.
    (4) Payments to participants, broadly defined for this subsection as 
all funds distributed to participants except OJT wages, shall not be 
considered as income for the purposes of determining eligibility for and 
the amount of income transfer and in-kind aid furnished under any 
Federal or federally assisted program based on need, other than as 
provided under the Social Security Act (section 142(b)).
    (5) The SDA is responsible for meeting any applicable Internal 
Revenue Service and Fair Labor Standards Act requirements (section 
142(a)(3)).
    (6) An SDA may set fixed levels for any non-wage payment.
    (b) Needs-based payments. (1) Participants in programs funded under 
title II may receive needs-based payments when such payments are 
necessary to enable the individual to participate in training programs. 
Payments shall be made in accordance with a locally developed policy 
which is included in the job training plan approved by the Governor.
    (2) The individual determination of participants' needs-based 
payments and the amount of such payments shall be based upon the results 
of the continuing objective assessment and determined in accordance with 
a locally developed policy. The provisions and amount of such payments 
shall be recorded in the ISS.
    (c) Incentive and bonus payments. Participants in programs funded 
under title II may receive incentive and bonus payments based on their 
attendance and performance in accordance with a locally developed 
policy. The policy shall be described in the job training plan approved 
by the Governor and shall include a specification of the requirements 
for the receipt of such payments and the level of payments.
    (d) Work-based training payments. Individuals participating in work 
experience, in entry employment experience programs, in limited 
internships for youth in the private sector, or in other work-based 
training activities under title II of the Act may receive work-based 
training payments which may be wages.
    (e) Summer participants may receive training payments for 
participation in activities under title II-B.
    (f) Training payments for combined activities. For title II 
programs, participants in one of the activities described in paragraph 
(d) of this section for which work-based training payments are payable 
for more than 50 percent of

[[Page 198]]

the participant's time, including classroom training, may also receive 
training payments for hours of participation in classroom training.



Sec.  627.310  Supportive services.

    (a)(1) The SDA or SSG shall develop a policy on supportive services 
in accordance with the definition at section 4(24) of the Act. This 
policy shall be included in the job training plan approved by the 
Governor (section 4(24)). Supportive services may be provided to 
participants through in-kind or cash assistance, or by arrangement with 
another human service agency when necessary to enable an individual who 
is eligible for training under a JTPA assisted program, but who cannot 
afford to pay for such services, to participate in such JTPA-assisted 
program.
    (2) In the event that an SDA or SSG adopts a policy of providing a 
fixed reimbursement for a particular supportive service to all 
participants, it shall, as part of its policy, state the rationale for 
its choice and the fixed amounts it has adopted.
    (b) Limited supportive services may be provided to applicants in 
order to permit them to complete the application process.
    (c) Necessary supportive services shall be recorded in a 
participant's ISS under title II or should be recorded in a 
participant's individual readjustment plan under title III. When 
supportive services are provided in accordance with paragraph (b) of 
this section, information on any supportive service provided may be 
maintained for future inclusion in an ISS.
    (d) The SDA or SSG shall ensure, to the extent possible, that 
similarly situated participants receive similar supportive services.
    (e) For title II participants, necessary supportive services (with 
the exception of financial assistance) may be provided for up to one 
year following termination as post-termination or followup services 
(sections 4(24), 204(b)(2)(J), and 204(c)(4)). For title III 
participants, the provisions at section 314(c)(15) of the Act shall 
apply.
    (f) An SDA or SSG may set fixed levels of benefit for any supportive 
service.
    (g)(1) For purposes of title II, financial assistance is defined as 
a general supportive service payment for the purpose of retaining 
participants in training.
    (2) Financial assistance payments may be considered to be necessary 
for participation in training for title II participants, i.e., a 
separate, individual determination of need is not necessary.
    (h) Needs-related payments. The requirements pertaining to needs-
related payments provided for under section 315(b) under title III of 
the Act, are described in part 631 of this chapter.



Sec.  627.315  Benefits and working conditions.

    (a) In the development and conduct of programs funded under the Act, 
SDA's and SSG's shall ensure that participants are not assigned to work 
for employers which do not comply with applicable labor laws, including 
wage and hour, occupational health and safety, and child labor laws (29 
CFR part 570).
    (b) To the extent that a State workers' compensation law is 
applicable, workers' compensation benefits in accordance with such law 
shall be available with respect to injuries suffered by participants. 
Where a State's workers' compensation law is not applicable, recipients 
and subrecipients shall secure insurance coverage for injuries suffered 
by such participants in all JTPA work-related activities. Income 
maintenance coverage (e.g., contributions for unemployment 
compensation), is not required for participants (section 143(a)(3)).
    (c) Where a participant is engaged in activities not covered under 
the Occupational Safety and Health Act of 1970, as amended, the 
participant shall not be required or permitted to work, be trained, or 
receive services in buildings or surroundings or under working 
conditions which are unsanitary, hazardous, or dangerous to the 
participant's health or safety. A participant employed or trained for 
inherently dangerous occupations, e.g., fire or police jobs, shall be 
assigned to work in accordance with reasonable safety practices (section 
143(a)(2)).

[[Page 199]]



                   Subpart D_Administrative Standards



Sec.  627.400  Scope and purpose.

    This subpart establishes the administrative and financial standards 
and requirements that apply to funds received under the Act.



Sec.  627.405  Grant agreement and funding.

    (a)(1) Pursuant toSec. 627.200 of this part and the Governor/
Secretary agreement, each program year there will be executed a grant 
agreement signed by the Governor or the Governor's designated 
representative and the Secretary or the Secretary's designated 
representative (Grant Officer).
    (2) The grant agreement described in paragraph (a)(1) of this 
section shall be the basis for Federal obligation of funds for the 
program year for programs authorized by titles I, II, and III, including 
any title III discretionary projects awarded to the State, and such 
other funds as the Secretary may award under the grant.
    (b) Funding. The Secretary shall allot funds to the States in 
accordance with sections 162, 202, 252, 262, and 302 of the Act. The 
Secretary shall obligate such allotments through Notices of Obligation.
    (c) Pursuant to instructions issued by the Secretary, additional 
funds may be awarded to States for the purpose of carrying out the 
administrative activities described in section 202(c)(1)(A) when a State 
receives an amount under such section that is less than $500,000 
(section 453(d)).
    (d) Termination. Each grant shall terminate when the period of 
availability for expenditure (funding period), as specified in section 
161(b) of the Act, has expired and shall be closed in accordance with 
Sec.  627.485, of this part, Closeout.



Sec.  627.410  Reallotment and reallocation.

    (a)(1) The Governor shall reallocate title II-A and II-C funds among 
service delivery areas within the State in accordance with the 
provisions of section 109(a) of the Act. The amount to be reallocated, 
if any, shall be based on SDA obligations of the funds allocated 
separately to each SDA for title II-A or II-C programs.
    (2) The Governor shall not establish reallocation requirements that 
are inconsistent with the provisions of section 109(a) of the Act.
    (b) The Secretary shall reallot title II-A and II-C funds among the 
States in accordance with the provisions of section 109(b) of the Act. 
The amounts to be reallotted, if any, shall be based on State 
obligations of the funds allotted separately to each State for title II-
A or II-C programs, excluding funds allotted under section 202(c)(1)(D) 
and the State's obligation of such funds.
    (c) Title III funds shall be reallotted by the Secretary in 
accordance with section 303 of the Act.



Sec.  627.415  Insurance.

    (a) General. Each recipient and subrecipient shall follow its normal 
insurance procedures except as otherwise indicated in this section and 
Sec.  627.465, Property Management Standards.
    (b) DOL assumes no liability with respect to bodily injury, illness, 
or any other damages or losses, or with respect to any claims arising 
out of any activity under a JTPA grant or agreement whether concerning 
persons or property in the recipient's or any subrecipient's 
organization or that of any third party.



Sec.  627.420  Procurement.

    (a) General. (1) For purposes of this section, the term procurement 
means the process which leads to any award of JTPA funds.
    (2) The Governor, in accordance with the minimum requirements 
established in this section, shall prescribe and implement procurement 
standards to ensure fiscal accountability and prevent waste, fraud, and 
abuse in programs administered under this Act.
    (3) When procuring property and services, a State shall follow the 
same policies and procedures it uses for procurements from its non-
Federal funds, provided that the State's procurement procedures also 
comply with the minimum requirements of this section.
    (4) Each subrecipient shall use its own procurement procedures which 
reflect applicable State and local laws

[[Page 200]]

and regulations, provided that the subrecipient's procurement procedures 
also comply with the requirements of this section and the standards 
established by the Governor, pursuant to paragraph (a)(2) of this 
section.
    (5) States and subrecipients shall not use funds provided under JTPA 
to duplicate facilities or services available in the area (with or 
without reimbursement) from Federal, State, or local sources, unless it 
is demonstrated that the JTPA-funded alternative services or facilities 
would be more effective or more likely to achieve performance goals 
(sections 107(b) and 141(h)).
    (6) Awards are to be made to responsible organizations possessing 
the demonstrated ability to perform successfully under the terms and 
conditions of a proposed subgrant or contract. A determination of 
demonstrated ability shall be done in accordance with the requirements 
contained inSec. 627.422 (b) and (d).
    (b) Competition. (1) Each State and subrecipient shall conduct 
procurements in a manner which provides full and open competition. Some 
of the situations considered to be restrictive of competition include, 
but are not limited to:
    (i) Placing unreasonable requirements on firms or organizations in 
order for them to qualify to do business;
    (ii) Requiring unnecessary experience and excessive bonding;
    (iii) Noncompetitive pricing practices between firms or 
organizations or between affiliated companies or organizations;
    (iv) Noncompetitive awards to consultants that are on retainer 
contracts;
    (v) Organizational conflicts of interest;
    (vi) Specifying only a ``brand name'' product instead of allowing 
``an equal'' product to be offered and describing the performance of 
other relevant requirements of the procurement;
    (vii) Overly restrictive specifications; and
    (viii) Any arbitrary action in the procurement process.
    (2) Each State and subrecipient shall have written procedures for 
procurement transactions. These procedures shall ensure that all 
solicitations:
    (i) Incorporate a clear and accurate description of the technical 
requirements for the material, product, or service to be procured 
(including quantities). Such description shall not, in competitive 
procurements, contain features which unduly restrict competition; and
    (ii) Identify all requirements which the offerors must fulfill and 
all other factors to be used in evaluating bids or proposals.
    (3) Each State and subrecipient shall ensure that all prequalified 
lists of persons, firms, or other organizations which are used in 
acquiring goods and services are current and include sufficient numbers 
of qualified sources to ensure maximum open and free competition.
    (c) Conflict of interest. (1) Each recipient and subrecipient shall 
maintain a written code of standards of conduct governing the 
performance of persons engaged in the award and administration of JTPA 
contracts and subgrants. To the extent permitted by State or local law 
or regulation, such standards of conduct will provide for penalties, 
sanctions, or other disciplinary actions for violations of such 
standards by the awarding agency's officers, employees, or agents, or by 
awardees or their agents.
    (2) Staff conflict of interest. Each recipient and subrecipient 
shall ensure that no individual in a decisionmaking capacity shall 
engage in any activity, including participation in the selection, award, 
or administration of a subgrant or contract supported by JTPA funds if a 
conflict of interest, real or apparent, would be involved.
    (3) PIC conflict of interest. (i) A PIC member shall not cast a 
vote, nor participate in any decisionmaking capacity, on the provision 
of services by such member (or any organization which that member 
directly represents), nor on any matter which would provide any direct 
financial benefit to that member.
    (ii) Neither membership on the PIC nor the receipt of JTPA funds to 
provide training and related services shall be construed, by itself, to 
violate provisions of section 141(f) of the Act orSec. 627.420.

[[Page 201]]

    (4) A conflict of interest under paragraphs (c) (2) and (3) of this 
section would arise when:
    (i) The individual,
    (ii) Any member of the individual's immediate family,
    (iii) The individual's partner, or
    (iv) An organization which employs, or is about to employ, any of 
the above, has a financial or other interest in the firm or organization 
selected for award.
    (5) The officers, employees, or agents of the agency and PIC members 
making the award will neither solicit nor accept gratuities, favors, or 
anything of monetary value from awardees, potential awardees, or parties 
to subagreements. States and subrecipients may set minimum rules where 
the financial interest is not substantial or the gift is an unsolicited 
item of nominal intrinsic value.
    (d) Methods of procurement. (1) Each State and subrecipient shall 
use one of the following methods of procurement, as appropriate for each 
procurement action:
    (i) Small purchase procedures--simple and informal procurement 
methods for securing services, supplies, or other property that do not 
cost more than $25,000 in the aggregate. Recipients and subrecipients 
shall not break down one purchase into several purchases merely to be 
able to use small purchase procedures. The Governor shall establish 
standards for small purchase procedures to ensure that price or rate 
quotations will be documented from an adequate number of qualified 
sources.
    (ii) Sealed bids (formal advertising)--bids are publicly solicited 
procurements for which a firm-fixed-price award (lump sum or unit price) 
or other fixed-price arrangement is awarded to the responsible bidder 
whose bid, conforming with all the material terms and conditions of the 
invitation for bids, is the lowest in price. The Governor shall 
establish standards for sealed bids which include requirements that 
invitations for bids be publicly advertised, and that bids be solicited 
from an adequate number of organizations.
    (iii) Competitive proposals--normally conducted with more than one 
source submitting an offer and either a fixed-price or cost-
reimbursement type award is made. The Governor shall establish standards 
for competitive proposals which include requirements for the 
establishment of a documented methodology for technical evaluations and 
award to the responsible offeror whose proposals are most advantageous 
to the program with price, technical, and other factors considered.
    (iv) Noncompetitive proposals (sole source)--procurement through 
solicitation of a proposal from only one source, the funding of an 
unsolicited proposal, or when, after solicitation of a number of 
sources, competition is determined inadequate. Each State and 
subrecipient shall minimize the use of sole source procurements to the 
extent practicable, but in every case the use of sole source 
procurements shall be justified and documented. On-the-job training 
(OJT) awards (except OJT brokering awards, which shall be selected 
competitively) and the enrollment of individual participants in 
classroom training may be sole sourced. For all other awards, 
procurement by noncompetitive proposals may be used only when the award 
is infeasible under small purchase procedures, sealed bids, or 
competitive proposals and one of the following circumstances applies:
    (A) The item or service is available only from a single source;
    (B) The public exigency or emergency need for the item or service 
does not permit a delay resulting from competitive solicitation;
    (C) For SDAs, SSGs and subrecipients, the awarding agency authorizes 
noncompetitive proposals; for States, the noncompetitive proposal is 
approved through the State's normal sole source approval process;
    (D) After solicitation of a number of sources, competition is 
determined inadequate;
    (2) Pass Throughs--The procurement rules do not apply to pass 
throughs of monies from any unit of State or local government (or SDA or 
SSG administrative entities) to other such units, such as a local 
educational agency or public housing authority. To qualify as a pass 
through, the receiving entity must either further pass through the

[[Page 202]]

monies to another such entity or procure services in accordance with the 
procurement rules.
    (e) Cost or price analysis. (1) Each recipient, in accordance with 
the minimum requirements established in this section, shall establish 
standards on the performance of cost or price analysis.
    (2) Each recipient and subrecipient shall perform a cost or price 
analysis in connection with every procurement action, including 
modifications (except for modifications where a determination has been 
made that they do not have a monetary impact). The method and degree of 
analysis depends on the facts surrounding the particular procurement and 
pricing situation. At a minimum, the awarding agency shall make 
independent estimates before receiving bids or proposals. A cost 
analysis is necessary when the offeror is required to submit the 
elements of the estimated cost (e.g., as in the case of subrecipient 
relationships), when adequate price competition is lacking, and for sole 
source procurements, including modifications or change orders. A price 
analysis shall be used when price reasonableness can be established on 
the basis of a catalog or market price of a commercial product sold in 
substantial quantities to the general public or based on prices set by 
law or regulation (including situations involving inadequate price 
competition and sole source procurements where a price analysis may be 
used in lieu of a cost analysis). When a cost analysis is necessary and 
there is inadequate price competition, the offeror shall certify that to 
the best of its knowledge and belief, the cost data are accurate, 
complete, and current at the time of agreement on price. Awards or 
modifications negotiated in reliance on such data should provide the 
awarding agency a right to a price adjustment to exclude any significant 
sum by which the price was increased because the awardee had knowingly 
submitted data that were not accurate, complete, or current as 
certified.
    (3) JTPA procurements shall not permit excess program income (for 
nonprofit and governmental entities) or excess profit (for private for-
profit entities). If profit or program income is included in the price, 
the awarding agency shall negotiate profit or program income as a 
separate element of the price for each procurement in which there is no 
price competition and in all cases where cost analysis is performed. To 
establish a fair and reasonable profit or program income, consideration 
shall be given to:
    (i) The complexity of the work to be performed;
    (ii) The risk borne by the awardee;
    (iii) The offeror's investment;
    (iv) The amount of subcontracting/subgranting;
    (v) The quality of the offeror's record of past performance;
    (vi) Industry profit rates in the surrounding geographical area for 
similar work; and
    (vii) Market conditions in the surrounding geographical area.
    (4) Each recipient and subrecipient may charge to the agreement only 
those costs which are consistent with the allowable cost provisions of 
Sec.  627.435 of this part, including the guidelines issued by the 
Governor, as required atSec. 627.435(i) of this part.
    (5) The cost plus a percentage of cost method shall not be used.
    (f) Oversight. (1) Each recipient and subrecipient shall conduct and 
document oversight to ensure compliance with the procurement standards, 
in accordance with the requirements ofSec. 627.475 of this part, 
Oversight and monitoring.
    (2) Each recipient and subrecipient shall maintain an administration 
system which ensures that vendors and subrecipients perform in 
accordance with the terms, conditions, and specifications of their 
awards.
    (g) Transactions between units of government. (1) Except as provided 
in paragraph (g)(2) of this section, procurement transactions between 
units of State or local governments, or any other entities organized 
principally as the administrative entity for service delivery areas or 
substate areas, shall be conducted on a cost reimbursable basis. Cost 
plus type awards are not allowable.
    (2) In the case of procurement transactions with schools that are a 
part of

[[Page 203]]

these entities, such as State universities and secondary schools, when 
tuition charges or entrance fees are not more than the educational 
institution's catalogue price, necessary to receive specific training, 
charged to the general public to receive the same training, and for 
training of participants, the tuition and/ or entrance fee does not have 
to be broken out by items of cost.
    (h) Award provisions. Each recipient and subrecipient agreement 
shall:
    (1) Clearly specify deliverables and the basis for payment; and
    (2) In the case of awards to subrecipients, contain clauses that 
provide for:
    (i) Compliance with the JTPA regulations;
    (ii) Assurance of nondiscrimination and equal opportunity as found 
in 29 CFR 34.20, Assurance required; duration of obligation; covenants.
    (3) In the case of awards to vendors, contain clauses that provide 
for:
    (i) Access by the recipient, the subrecipient, the Department of 
Labor, the Comptroller General of the United States, or any of their 
duly authorized representatives to any books, documents, papers, and 
records (including computer records) of the contractor or subcontractor 
which are directly pertinent to charges to the program, in order to 
conduct audits and examinations and to make excerpts, transcripts, and 
photocopies; this right also includes timely and reasonable access to 
contractor's and subcontractor's personnel for the purpose of interviews 
and discussions related to such documents;
    (4) In the case of awards to both subrecipients and vendors, contain 
clauses that provide for:
    (i) Administrative, contractual, or legal remedies in instances 
where contractors/subgrantees violate or breach agreement terms, which 
shall provide for such sanctions and penalties as may be appropriate;
    (ii) Notice of 29 CFR 97.34 requirements pertaining to copyrights 
(agreements which involve the use of copyrighted materials or the 
development of copyrightable materials);
    (iii) Notice of requirements pertaining to rights to data. 
Specifically, the awarding agency and the Department of Labor shall have 
unlimited rights to any data first produced or delivered under the 
agreement (agreements which involve the use/development of computer 
programs/ applications, or the maintenance of databases or other 
computer data processing program, including the inputing of data);
    (iv) Termination for cause and for convenience by the awarding 
agency, including the manner by which the termination will be effected 
and the basis for settlement;
    (v) Notice of awarding agency requirements and regulations 
pertaining to reporting;
    (vi) Audit rights and requirements;
    (vii) Payment conditions and delivery terms;
    (viii) Process and authority for agreement changes; and
    (ix) Provision against assignment;
    (5) The Governor may establish additional clauses, as deemed 
appropriate, for State and subrecipient procurements.
    (i) Disputes. (1) The Governor shall ensure that the recipient and 
each subrecipient have protest procedures to handle and resolve disputes 
relating to their procurements. A protester shall exhaust all 
administrative remedies with the subrecipient before pursuing a protest 
at a higher level.
    (2) Violations of law will be handled in accordance with the 
requirements contained inSec. 627.500(c).
    (j) Each recipient and subrecipient shall maintain records 
sufficient to detail the significant history of a procurement. These 
records shall include, but are not necessarily limited to, the 
following: rationale for the method of procurement, selection of 
agreement type, awardee selection or rejection, and the basis for the 
agreement price.



Sec.  627.422  Selection of service providers.

    (a) Service providers selected under titles I, II, and III of the 
Act shall be selected in accordance with the provisions of section 107 
of the Act, except that section 107(d) shall not apply to training under 
title III.
    (b) Consistent with the requirements of this section, the Governor 
shall establish standards to be followed by recipients and subrecipients 
in making

[[Page 204]]

determinations of demonstrated performance, prior to the award of all 
agreements under titles I, II, and III of the Act. These standards shall 
comply with the requirements of this section,Sec. 627.420, of this 
part, Procurement, and section 164(a)(3) of the Act. The standards shall 
require that determinations of demonstrated performance will be in 
writing, and completed prior to the award of an agreement.
    (c) Each recipient and subrecipient, to the extent practicable, 
shall select service providers on a competitive basis, in accordance 
with the standards established inSec. 627.420(b) of this part, 
Procurement. When a State, SDA, SSG, or administrative entity determines 
that services other than intake and eligibility determination will be 
provided by its own staff, a determination shall be made of the 
demonstrated performance of the entity to provide the services. This 
determination: Shall be in writing; shall take into consideration the 
matters listed in paragraph (d) of this section; and may, if 
appropriate, be documented and described in the Job Training Plan, 
GCSSP, or EDWAA plan.
    (d) Awards are to be made to organizations possessing the 
demonstrated ability to perform successfully under the terms and 
conditions of a proposed subgrant or contract. Where comparable 
proposals have been received from an offeror which has demonstrated 
performance and a high-risk recipient/subrecipient, and a determination 
has been made that both proposals are fundable, the award should be made 
to the offeror which has demonstrated performance, unless other factors 
dictate a contrary result. Determinations of demonstrated performance 
shall be in writing, and take into consideration such matters as whether 
the organization has:
    (1) Adequate financial resources or the ability to obtain them;
    (2) The ability to meet the program design specifications at a 
reasonable cost, as well as the ability to meet performance goals;
    (3) A satisfactory record of past performance (in job training, 
basic skills training, or related activities), including demonstrated 
quality of training; reasonable drop-out rates from past programs; where 
applicable, the ability to provide or arrange for appropriate supportive 
services as specified in the ISS, including child care; retention in 
employment; and earning rates of participants;
    (4) For title II programs, the ability to provide services that can 
lead to the achievement of competency standards for participants with 
identified deficiencies;
    (5) A satisfactory record of integrity, business ethics, and fiscal 
accountability;
    (6) The necessary organization, experience, accounting and 
operational controls; and
    (7) The technical skills to perform the work.
    (e) In selecting service providers to deliver services in a service 
delivery area/substate area, proper consideration shall be given to 
community-based organizations (section 107(a)). These community-based 
organizations, including women's organizations with knowledge about or 
experience in nontraditional training for women, shall be organizations 
which are recognized in the community in which they are to provide 
services. Where proposals are evenly rated, and one of these proposals 
has been submitted by a CBO, the tie breaker may go to the CBO.
    (f) Appropriate education agencies in the service delivery area/
substate area shall be provided the opportunity to provide educational 
services, unless the administrative entity demonstrates that alternative 
agency(ies) or organization(s) would be more effective or would have 
greater potential to enhance the participants' continued educational and 
career growth (section 107(c)). Where proposals are evenly rated, and 
one of these proposals has been submitted by an educational institution, 
the tie breaker shall go to the educational institution.
    (g) In determining demonstrated performance of institutions/
organizations which provide training, such performance measures as 
retention in training, training completion, job placement, and rates of 
licensure shall be taken into consideration.

[[Page 205]]

    (h) Service providers under agreements to conduct projects under 
section 123(a)(2) shall be selected in accordance with the requirements 
of this section.
    (i) The requirements of section 204(d)(2)(B) shall be followed in 
entering into agreements to provide services for older individuals 
funded under title II, part A.
    (j) Additional requirements for selection of service providers by 
substate grantees are described at section 313(b)(6) of the Act and 
Sec.  631.52 of this chapter.
    (k) Amounts for service providers. Each SDA/SSG shall ensure that, 
for all services provided to participants through contracts, grants, or 
other agreements with a service provider, such contract, grant, or 
agreement shall include appropriate amounts necessary for administration 
and supportive services (section 108(b)(5)).
    (l) When a State, SDA or SSG has a policy of awarding additional 
points to proposals received from such organizations as minority 
business enterprises and women-owned businesses, and this policy is 
generally applicable to its other funds, the State, SDA or SSG may apply 
this policy to the JTPA funds.



Sec.  627.423  Funding restrictions for ``high-risk'' recipients and
subrecipients.

    (a) A recipient or subrecipient may be considered ``high-risk'' if 
an awarding agency determines that the recipient or subrecipient is 
otherwise responsible, but:
    (1) Has a history of unsatisfactory performance;
    (2) Is not financially stable;
    (3) Has a management system which does not meet the management 
standards set forth in this part; or
    (4) Has not conformed to terms and conditions of a previously 
awarded grant or subgrant.
    (b) If the awarding agency determines that an award will be made to 
a ``high-risk'' recipient or subrecipient, then special funding 
restrictions that address the ``high-risk'' status may be included in 
the award. Funding restrictions may include, but are not limited to:
    (1) Payment on a reimbursement basis;
    (2) Requiring additional and/or more detailed financial or 
performance reports;
    (3) Additional monitoring;
    (4) Requiring the recipient or subrecipient to obtain specific 
technical or management assistance; and/or
    (5) Establishing additional prior approvals.
    (c) If an awarding agency decides to impose such funding 
restrictions, the awarding official will notify the recipient or 
subrecipient as early as possible, in writing, of:
    (1) The nature of the funding restrictions;
    (2) The reason(s) for imposing them;
    (3) The corrective actions which must be taken before they will be 
removed and the time allowed for completing the corrective actions; and
    (4) The method of requesting reconsideration of the restrictions 
imposed.



Sec.  627.424  Prohibition of subawards to debarred and suspended
parties.

    (a) No recipient or subrecipient shall make any awards or permit any 
awards at any tier to any party which is debarred or suspended or is 
otherwise excluded from or ineligible for participation in Federal 
assistance programs in accordance with the Department of Labor 
regulations at 29 CFR part 98.
    (b) Recipients and subrecipients shall comply with the applicable 
requirements of the Department of Labor regulations at 29 CFR part 98.



Sec.  627.425  Standards for financial management and participant
data systems.

    (a)(1) General. The financial management system and the participant 
data system of each recipient and subrecipient shall provide federally 
required records and reports that are uniform in definition, accessible 
to authorized Federal and State staff, and verifiable for monitoring, 
reporting, audit, program management, and evaluation purposes (sections 
165(a)(1) and (2), and 182).
    (2) An awarding agency may review the adequacy of the financial 
management system and participant data system of any recipient/
subrecipient as

[[Page 206]]

part of a preaward review or at any time subsequent to award.
    (b) Financial systems. Recipients and subrecipients shall ensure 
that their own financial systems as well as those of their subrecipients 
provide fiscal control and accounting procedures that are:
    (1) In accordance with generally accepted accounting principles 
applicable in each State including:
    (i) Information pertaining to subgrant and contract awards, 
obligations, unobligated balances, assets, liabilities, expenditures, 
and income;
    (ii) Effective internal controls to safeguard assets and assure 
their proper use;
    (iii) A comparison of actual expenditures with budgeted amounts for 
each subgrant and contract;
    (iv) Source documentation to support accounting records; and
    (v) Proper charging of costs and cost allocation; and
    (2) Sufficient to:
    (i) Permit preparation of required reports;
    (ii) Permit the tracing of funds to a level of expenditure adequate 
to establish that funds have not been used in violation of the 
applicable restrictions on the use of such funds;
    (iii) As required by section 165(g), permit the tracing of program 
income, potential stand-in costs and other funds that are allowable 
except for funding limitations, as defined inSec. 627.480(f) of this 
part, Audits; and
    (iv) Demonstrate compliance with the matching requirement of section 
123(b)(2).
    (c) Applicant and participant data systems. Each recipient and 
subrecipient shall ensure that records are maintained:
    (1) Of each applicant for whom an application has been completed and 
a formal determination of eligibility or ineligibility made;
    (2) Of each participant's enrollment in a JTPA-funded program in 
sufficient detail to demonstrate compliance with the relevant 
eligibility criteria attending a particular activity and with the 
restrictions on the provision and duration of services and specific 
activities imposed by the Act; and
    (3) Of such participant information as may be necessary to develop 
and measure the achievement of performance standards established by the 
Secretary.



Sec.  627.430  Grant payments.

    (a) Except as provided in paragraph (h)(2) of this section, JTPA 
grant payments shall be made to the Governor in accordance with the Cash 
Management Improvement Act of 1990 (31 U.S.C. 6501, et seq.), Department 
of Treasury regulations at 31 CFR part 205, and the State Agreement 
entered into with the Department of the Treasury.
    (b) Basic standard. Except as provided in paragraphs (d) and (e) of 
this section, each recipient and subrecipient shall be paid in advance, 
provided it demonstrates the willingness and ability to limit advanced 
funds to the actual immediate disbursement needs in carrying out the 
JTPA program.
    (c) Advance payments. To the maximum extent feasible, each 
subrecipient shall be provided advance payments via electronic funds 
transfer, following the procedures of the awarding agency.
    (d) Reimbursement. (1) Reimbursement is the preferred method when 
the requirements in paragraph (b) of this section are not met.
    (i) Each recipient shall submit requests for reimbursement in 
accordance with the provisions at 31 CFR part 205.
    (ii) Each subrecipient shall submit requests for reimbursement in 
accordance with requirements established by the awarding agency.
    (2) Each subrecipient shall be paid as promptly as possible after 
receipt of a proper request for reimbursement.
    (e) Working capital advance payments. If a subrecipient cannot meet 
the criteria for advance payments described in paragraph (b) of this 
section, and the awarding agency has determined that reimbursement is 
not feasible because the subrecipient lacks sufficient working capital, 
the awarding agency may provide cash on a working capital advance 
payment basis. Under this procedure, the awarding agency shall advance 
cash to the subrecipient to cover its estimated disbursement needs for 
an initial period, generally geared to the subrecipient's disbursing 
cycle. In

[[Page 207]]

no event may such an advance exceed 20 percent of the award amount. 
Thereafter, the awarding agency shall reimburse the subrecipient for its 
actual cash disbursements. The working capital advance method of payment 
shall not be used by recipients or subrecipients if the reason for using 
such method is the unwillingness or inability of the recipient or 
subrecipient to provide timely advances to the subrecipient to meet the 
subrecipient's actual cash disbursements.
    (f) Effect of program income, refunds, and audit recoveries on 
payment. Each recipient and subrecipient shall disburse cash received as 
a result of program income, rebates, refunds, contract settlements, 
audit recoveries, and interest earned on such funds before requesting 
additional cash payments.
    (g) Cash depositories. (1) Consistent with the national goal of 
expanding the opportunities for minority business enterprises, each 
recipient and subrecipient is encouraged to use minority-owned banks (a 
bank which is at least 50 percent owned by minority group members). 
Additional information may be obtained from the Minority Business 
Development Agency, Department of Commerce, Washington, DC 20230.
    (2) A recipient or subrecipient shall not be required to maintain a 
separate bank account but shall separately account for Federal funds on 
deposit.
    (h) Interest earned on advances. (1) An interest liability shall 
accrue on advance payments between Federal agencies and State 
governments, as provided by the Cash Management Improvement Act (31 
U.S.C. 6501, et seq.) and implementing regulations at 31 CFR part 205.
    (2) Each recipient and subrecipient shall account for interest 
earned on advances of Federal funds as program income, as provided at 
Sec.  627.450 of this part, Program income.



Sec.  627.435  Cost principles and allowable costs.

    (a) General. To be allowable, a cost shall be necessary and 
reasonable for the proper and efficient administration of the program, 
be allocable to the program, and, except as provided herein, not be a 
general expense required to carry out the overall responsibilities of 
the Governor or a governmental subrecipient. Costs charged to the 
program shall be accorded consistent treatment through application of 
generally accepted accounting principles appropriate to the JTPA 
program, as determined by the Governor.
    (b) Whether a cost is charged as a direct cost or as an indirect 
cost shall be determined in accordance with the descriptions of direct 
and indirect costs contained in the OMB Circulars identified in DOL's 
regulations at 29 CFR 97.22(b).
    (c) Costs allocable to another Federal grant, JTPA program, or cost 
category may not be shifted to a JTPA grant, subgrant, program, or cost 
category to overcome fund deficiencies, avoid restrictions imposed by 
law or grant agreements, or for other reasons.
    (d) Applicable credits such as rebates, discounts, refunds, and 
overpayment adjustments, as well as interest earned on any of them, 
shall be credited as a reduction of costs if received during the same 
funding period that the cost was initially charged. Credits received 
after the funding period shall be returned to the Department as provided 
for atSec. 627.490(b).
    (e) The following costs are not allowable charges to the JTPA 
program:
    (1) Costs of fines and penalties resulting from violations of, or 
failure to comply with, Federal, State, or local laws and regulations;
    (2) Back pay, unless it represents additional pay for JTPA services 
performed for which the individual was underpaid;
    (3) Entertainment costs;
    (4) Bad debts expense;
    (5) Insurance policies offering protection against debts established 
by the Federal Government;
    (6) Contributions to a contingency reserve or any similar provision 
for unforeseen events;
    (7) Costs prohibited by 29 CFR part 93 (Lobbying Restrictions) or 
costs of any salaries or expenses related to any activity designed to 
influence legislation or appropriations pending before the Congress of 
the United States; and
    (8) Costs of activities prohibited inSec. 627.205, Public service 
employment

[[Page 208]]

prohibition;Sec. 627.210, Nondiscrimination and nonsectarian 
activities;Sec. 627.215, Relocation;Sec. 627.225, Employment 
generating activities; andSec. 627.230, Displacement, of this part.
    (f)(1) The cost of legal expenses required in the administration of 
grant programs is allowable. Legal expenses include the expenses 
incurred by the JTPA system in the establishment and maintenance of a 
grievance system, including the costs of hearings and appeals, and 
related expenses such as lawyers' fees. Legal expenses does not include 
costs resulting from, and after, the grievance process such as fines and 
penalties, which are not allowable, and settlement costs, which are 
allowable to the extent that such costs included in the settlement would 
have been allowable if charged to the JTPA program at the time they were 
incurred.
    (2) Legal services furnished by the chief legal officer of a State 
or local government or staff solely for the purpose of discharging 
general responsibilities as a legal officer are unallowable.
    (3) Legal expenses for the prosecution of claims against the Federal 
Government, including appeals to an Administrative Law Judge, are 
unallowable.
    (g) Costs of travel and incidental expenses incurred by volunteers 
are allowable provided such costs are incurred for activities that are 
generally consistent with section 204(c)(6) of the Act.
    (h) Contributions to a reserve for a self-insurance program, to the 
extent that the type and extent of coverage and the rates and premiums 
would have been allowed had insurance been purchased to cover the risks, 
are allowable.
    (i) The Governor shall prescribe and implement guidelines on 
allowable costs for SDA, SSG, and statewide programs that are consistent 
with the cost principles and allowable costs provisions of paragraphs 
(a) through (h) of this section and that include, at a minimum, 
provisions that specify the extent to which the following cost items are 
allowable or unallowable JTPA costs and, if allowable, guidelines on 
conditions or the extent of allowability, documentation requirements, 
and any prior approval requirements applicable to such cost items:
    (1) Compensation for personal services of staff, including wages, 
salaries, supplementary compensation, and fringe benefits;
    (2) Costs incurred by the SJTCC, HRIC, PIC's, and other advisory 
councils or committees;
    (3) Advertising costs;
    (4) Depreciation and/or use allowances;
    (5) Printing and reproduction costs;
    (6) Interest expense;
    (7) Expenditures for transportation and travel;
    (8) Payments to OJT employers, training institutions, and other 
vendors;
    (9) Fees or profits;
    (10) Insurance costs, including insurance coverage for injuries 
suffered by participants who are not covered by existing workers' 
compensation, and personal liability insurance for PIC members;
    (11) Acquisitions of capital assets;
    (12) Building space costs, including rent, repairs, and alterations;
    (13) Pre-agreement costs;
    (14) Fund-raising activities;
    (15) Professional services, including organizational management 
studies conducted by outside individuals or firms; and
    (16) Taxes.



Sec.  627.440  Classification of costs.

    (a) Allowable costs for programs under title II and title III shall 
be charged (allocated) to a particular cost objective/category to the 
extent that benefits are received by such cost objective/category. Joint 
and similar types of costs may be charged initially to a cost pool used 
for the accumulation of such costs pending distribution in due course to 
the ultimate benefitting cost objective/category. The classification of 
costs for programs under title III of the Act are set forth atSec. 
631.13 of this chapter, Classification of costs at State and substate 
levels.
    (b) For State-administered programs under Title II, the State is 
required to plan, control, and charge expenditures against the following 
cost objectives/categories:
    (1) Titles II-A and II-C (combined)--capacity building and technical 
assistance (sections 202(c)(1)(B) and

[[Page 209]]

262(c)(1)(B) of the Act to carry out activities pursuant to sections 
202(c)(3)(A) and 262(c)(3)(A) of the Act);
    (2) Titles II-A and II-C (combined)--8 percent coordination 
(sections 202(c)(1)(C) and 262(c)(1)(C) of the Act to carry out 
activities pursuant to section 123(d)(2)(A) of the Act);
    (3) Titles II-A and II-C (combined)--8 percent services/direct 
training (sections 202(c)(1)(C) and 262(c)(1)(C) of the Act to carry out 
activities pursuant to section 123(d)(2)(B) of the Act);
    (4) Titles II-A and II-C (combined)--8 percent services/training-
related and supportive services (sections 202(c)(1)(C) and 262(c)(1)(C) 
of the Act to carry out activities pursuant to section 123(d)(2)(B) of 
the Act);
    (5) Titles II-A and II-C (combined)--8 percent services/
administration (sections 202(c)(1)(C) and 262(c)(1)(C) of the Act to 
carry out activities pursuant to section 123(d)(2)(B) of the Act);
    (6) Titles II-A and II-C (combined)--8 percent services to 
disadvantaged (section 202(c)(1)(C) and 262(c)(1)(C) of the Act to carry 
out activities pursuant to section 123(d)(2)(C) of the Act);
    (7) Title II-A--older individuals/direct training (section 
202(c)(1)(D) of the Act to carry out activities pursuant to section 
204(d) of the Act);
    (8) Title II-A--older individuals/training-related and supportive 
services (section 202(c)(1)(D) of the Act to carry out activities 
pursuant to section 204(d) of the Act);
    (9) Title II-A--older individuals/administration (section 
202(c)(1)(D) of the Act to carry out activities pursuant to section 
204(d) of the Act); and
    (10) Title II--administration (sections 202(c)(1)(A) and 
262(c)(1)(A) of the Act to carry out activities pursuant to Title II of 
the Act, including Title II-B).
    (c)(1) SDA grant recipients and their subrecipients shall plan, 
control, and charge expenditures, excluding incentive funds received 
pursuant to sections 202(c)(1)(B) and 262(c)(1)(B) of the Act, against 
the following cost objectives/categories:
    (i) Title II-A--direct training services;
    (ii) Title II-C--direct training services;
    (iii) Title II-A--training-related and supportive services;
    (iv) Title II-C--training-related and supportive services;
    (v) Title II-B--training and supportive services;
    (vi) Title II-A--administration;
    (vii) Title II-B--administration; and
    (viii) Title II-C--administration.
    (2) Incentive funds received pursuant to sections 202(c)(1)(B) and 
262(c)(1)(B) of the Act, may be combined and accounted for in total, 
without regard to cost categories or cost limitations.
    (d) States and subrecipients shall use the following definitions in 
assigning costs to the cost categories contained in paragraphs (b) and 
(c) of this section:
    (1) Direct training services--title II-A. Costs for direct training 
services that may be charged to the title II-A program are:
    (i) The personnel and non-personnel costs directly related to 
providing those services to participants specified in section 204(b)(1) 
of the Act and which can be specifically identified with one or more of 
those services. Generally, such costs are limited to:
    (A) Salaries, fringe benefits, equipment, supplies, space, staff 
training, transportation, and other related costs of personnel directly 
engaged in providing training; and
    (B) Salaries, fringe benefits, and related non-personnel costs of 
program component supervisors and/or coordinators as well as clerical 
staff, provided such staff work exclusively on activities or functions 
specified in section 204(b)(1) of the Act or allocations of such costs 
are made based on actual time worked or other equitable cost allocation 
methods;
    (ii) Books, instructional materials, and other teaching aids used by 
or for participants;
    (iii) Equipment and materials used in providing training to 
participants;
    (iv) Classroom space and utility costs;
    (v) Costs of insurance coverage of participants as specified at 
Sec.  627.315(b) of this part, Benefits and Working Conditions;
    (vi) Payments to vendors for goods or services procured for the use 
or benefit

[[Page 210]]

of program participants for direct training services, including:
    (A) Payments for commercially available training packages purchased 
competitively pursuant to section 141(d)(3) of the Act;
    (B) Tuition charges, entrance fees, and other usual and customary 
fees of an educational institution when such tuition charges, entrance 
fees, or other fees are not more than the educational institution's 
catalogue price, necessary to receive specific training, charged to the 
general public to receive the same training, and are for training of 
participants; and
    (C) Payments to OJT employers, but not brokering contractors. Costs 
incurred under brokering arrangements shall be allocated to all of the 
benefitting cost categories, and
    (vii) Payments to JTPA participants that represent hours spent in a 
direct training activity (e.g., wages, work-based training payments, 
training payments for combined activities), including work experience, 
vocational exploration, limited internships, and entry employment.
    (2) Direct training services--title II-C. Costs for direct training 
services that may be charged to the title II-C program are the costs 
identified in paragraph (d)(1) of this section as well as costs directly 
related to providing those services to participants specified in section 
264(c)(1) of the Act and which can be specifically identified with one 
or more of those services.
    (3) Training-related and supportive services--title II-A. Costs for 
training-related and supportive services that may be charged to the 
title II-A program are:
    (i) The personnel and non-personnel costs directly related to 
providing outreach, intake, and eligibility determination, as well as 
those services to participants specified in section 204(b)(2) of the 
Act, and which can be specifically identified with one or more of those 
services. Generally, such costs are limited to:
    (A) Salaries, fringe benefits, equipment, supplies, space, staff 
training, transportation, and other related costs of personnel directly 
engaged in providing training-related and/or supportive services; and
    (B) Salaries, fringe benefits, and related non-personnel costs of 
program component supervisors and/or coordinators as well as clerical 
staff, provided such staff work exclusively on activities or functions 
specified in section 204(b)(2) of the Act or allocations of such costs 
are made based on actual time worked or another equitable allocation 
method.
    (ii) Needs-based payments, cash incentives and bonuses, other 
financial assistance and supportive services to participants and 
applicants, where applicable.
    (4) Training-related and supportive services--title II-C. Costs for 
training-related and supportive services that may be charged to the 
title II-C program are the costs identified in paragraph (d)(3) of this 
section, as well as costs directly related to providing those services 
to participants specified in section 264(c)(2) of the Act and which can 
be specifically identified with one or more of those services.
    (5) Administration. The costs of administration are those portions 
of necessary and allowable costs associated with the overall management 
and administration of the JTPA program and which are not directly 
related to the provision of services to participants or otherwise 
allocable to the program cost objectives/categories in paragraphs 
(b)(1)-(8) or (c)(1) (i)-(v) of this section. These costs can be both 
personnel and non-personnel and both direct and indirect. Costs of 
administration shall include:
    (i) Except as provided in paragraph (e)(1) of this section, costs of 
salaries, wages, and related costs of the recipient's or subrecipient's 
staff or PIC staff engaged in:
    (A) Overall program management, program coordination, and general 
administrative functions, including the salaries and related costs of 
the executive director, JTPA director, project director, personnel 
officer, fiscal officer/bookkeeper, purchasing officer, secretary, 
payroll/insurance/property clerk and other costs associated with 
carrying out administrative functions;
    (B) Preparing program plans, budgets, schedules, and amendments 
thereto;

[[Page 211]]

    (C) Monitoring of programs, projects, subrecipients, and related 
systems and processes;
    (D) Procurement activities, including the award of specific 
subgrants, contracts, and purchase orders;
    (E) Providing State or local officials and the general public with 
information about the program (public relations);
    (F) Developing systems and procedures, including management 
information systems, for assuring compliance with program requirements;
    (G) Preparing reports and other documents related to the program 
requirements;
    (H) Coordinating the resolution of audit findings;
    (I) Evaluating program results against stated objectives; and
    (J) Performing such administrative services as general legal 
services, accounting services, audit services; and managing purchasing, 
property, payroll, and personnel;
    (ii) Costs for goods and services required for administration of the 
program, including such goods and services as rental or purchase of 
equipment, utilities, office supplies, postage, and rental and 
maintenance of office space;
    (iii) The costs of organization-wide management functions; and
    (iv) Travel costs incurred for official business in carrying out 
program management or administrative activities, including travel costs 
incurred by PIC members.
    (e) Other cost classification guidance. (1) Personnel and related 
non-personnel costs of the recipient's or subrecipient's staff, 
including project directors, who perform services or activities that 
benefit two or more of the cost objectives/categories identified in this 
section may be allocated to the benefitting cost objectives/categories 
based on documented distributions of actual time worked or other 
equitable cost allocation methods.
    (2) Indirect or overhead costs normally shall be charged to 
administration, except that specific costs charged to an overhead or 
indirect cost pool that can be identified directly with a JTPA cost 
objective/category other than administration may be charged to the JTPA 
cost objective/category directly benefitted. Documentation of such 
charges shall be maintained.
    (3) Where an award to a subrecipient is for a ``commercially 
available off-the-shelf training package,'' as defined atSec. 626.5 of 
this chapter, the subrecipient may charge all costs of such package to 
the direct training services cost category.
    (4) Profits, fees, and other revenues earned by a subrecipient that 
are in excess of actual costs incurred, to the extent allowable and 
consistent with the guidelines on allowable costs prescribed by the 
Governor in accordance withSec. 627.435(i). Cost principles and 
allowable costs, may be allocated to all three cost categories based on 
the proportionate share of actual costs incurred attributable to each 
category.



Sec.  627.445  Limitations on certain costs.

    (a) State-administered programs--(1) Services for older individuals. 
Of the funds allocated for any program year for section 202(c)(1)(D) of 
the Act to carry out activities pursuant to section 204(d) of the Act--
    (i) Not less than 50 percent shall be expended for the cost of 
direct training services; and
    (ii) Not more than 20 percent shall be expended for the cost of 
administration.
    (2) State education services. Of the funds allocated for any program 
year for sections 202(c)(1)(C) and 262(c)(1)(C) of the Act to carry out 
activities pursuant to section 123(d)(2)(B) of the Act--
    (i) Not less than 50 percent shall be expended for the cost of 
direct training services; and
    (ii) Not more than 20 percent shall be expended for the cost of 
administration.
    (3) The limitations specified in paragraph (a)(2) of this section 
shall apply to the combined total of funds allocated for sections 
202(c)(1)(C) and 262(c)(1)(C) of the Act.
    (b) SDA allocations. (1) In applying the title II-A and II-C cost 
limitations specified in section 108(b)(4) of the Act, the funds 
allocated to a service delivery area shall be net of any:
    (i) Transfers made in accordance with sections 206, 256, and 266 of 
the Act; and

[[Page 212]]

    (ii) Reallocations made by the Governor in accordance with section 
109(a) of the Act.
    (2) The limitations specified in paragraph (b)(1) of this section 
shall apply separately to the funds allocated for title II-A and title 
II-C programs.
    (3) The title II-B administrative cost limitation of 15 percent 
shall be 15 percent of the funds allocated for any program year to a 
service delivery area, excluding any funds transferred to title II-C in 
accordance with section 256 of the Act (section 253(a)(3)).
    (c)(1) The State shall establish a system to regularly assess 
compliance with the cost limitations including periodic review and 
corrective action, as necessary.
    (2) States and service delivery areas shall have the 3-year period 
of fund availability to comply with the cost limitations in section 108 
of the Act and paragraphs (a) and (b) of this section (section 161(b)).
    (d) Administrative costs incurred by a community-based organization 
or non-profit service provider shall not be included in the limitation 
described in section 108(b)(4)(A) of the Act if:
    (1) Such costs are incurred under an agreement that meets the 
requirements of section 141(d)(3)(C) (i) and (ii) of the Act;
    (2) The total administrative expenditures of the service delivery 
area, including the administrative expenditures of such community-based 
organizations or non-profit service providers, do not exceed 25 percent 
of the funds allocated to the service delivery area for the program year 
of allocation; and
    (3) The total direct training expenditures of the service delivery 
area, including the direct training expenditures of such community-based 
organizations or non-profit service providers, is equal to or exceeds 50 
percent of the funds allocated to the service delivery area for the 
program year less one-half of the percentage by which the total 
administrative expenditures of the service delivery area exceeds 20 
percent. For example, if the total administrative expenditures of the 
service delivery area is 24 percent, then the total direct training 
expenditures of the service delivery area must be at least 48 percent.
    (e) The provisions of this section do not apply to any title III 
programs.
    (f) The provisions of this section do not apply to any designated 
SDA which served as a concentrated employment program grantee for a 
rural area under the Comprehensive Employment and Training Act (section 
108(d)).



Sec.  627.450  Program income.

    (a) Definition of program income. (1) Program income means income 
received by the recipient or subrecipient that is directly generated by 
a grant or subgrant supported activity, or earned only as a result of 
the grant or subgrant. Program income includes:
    (i) Income from fees for services performed and from conferences;
    (ii) Income from the use or rental of real or personal property 
acquired with grant or subgrant funds;
    (iii) Income from the sale of commodities or items fabricated under 
a grant or subgrant;
    (iv) Revenues earned by a governmental or non-profit service 
provider under either a fixed-price or reimbursable award that are in 
excess of the actual costs incurred in providing the services; and
    (v) Interest income earned on advances of JTPA funds.
    (2) Program income does not include:
    (i) Rebates, credits, discounts, refunds, etc., or interest earned 
on any of them, which shall be credited in accordance withSec. 
627.435(d), Cost principles and allowable costs;
    (ii) Taxes, special assessments, levies, fines, and other such 
governmental revenues raised by a recipient or subrecipient; or
    (iii) Income from royalties and license fees for copyrighted 
material, patents, patent applications, trademarks, and inventions 
developed by a recipient or subrecipient.
    (3) Property. Proceeds from the sale of property shall be handled in 
accordance with the requirements ofSec. 627.465 of this part, Property 
management standards.
    (b) Cost of generating program income. Costs incidental to the 
generation of program income may be deducted, if not already charged to 
the grant, from gross income to determine program income.

[[Page 213]]

    (c) Use of program income. (1)(i) A recipient or subrecipient may 
retain any program income earned by the recipient or subrecipient only 
if such income is added to the funds committed to the particular JTPA 
grant or subgrant and title under which it was earned and such income is 
used for that title's purposes and under the terms and conditions 
applicable to the use of the grant funds.
    (ii) A State may use interest it earns on JTPA funds, deposited by 
the United States to the State's account, to satisfy the requirement at 
31 U.S.C. 6503(c) that the State pay interest on such deposits.
    (iii) The classification of costs in Sec.Sec. 627.440 and 631.13 
shall apply to the use of program income.
    (iv) The administrative cost limitation in Sec.Sec. 627.445 and 
631.14 shall apply to the use of program income, except that program 
income used in accordance with paragraph (c)(1)(ii) of this section 
shall be exempt from the administrative cost limitations.
    (2) Program income generated under title II may also be used to 
satisfy the matching requirement of section 123(b) of the Act.
    (3) Program income shall be used prior to the submission of the 
final report for the funding period of the program year of funds to 
which the earnings are attributable.
    (4) If the subrecipient that earned program income cannot use such 
income for JTPA purposes, the recipient may permit another entity to use 
the program income for JTPA purposes.
    (5) Program income not used in accordance with the requirements of 
this section shall be remitted to the Department of Labor.
    (d) Program and other income after the funding period. Rental income 
and user fees on real and personal property acquired with JTPA funds 
shall continue to be JTPA program income in subsequent funding periods. 
There are no Federal requirements governing the disposition of all other 
income that is earned after the end of the funding period.



Sec.  627.455  Reports required.

    (a) General. The Governor shall report to DOL pursuant to 
instructions issued by DOL. Reports shall be submitted no more 
frequently than quarterly, in accordance with section 165(f) of the Act, 
and within 45 calendar days after the end of the report period. 
Additional reporting requirements for title III are set forth atSec. 
631.15 of this chapter.
    (b) A recipient may impose different forms or formats, shorter due 
dates, and more frequent reporting requirements on subrecipients, 
however, the recipient is required to meet the reporting requirements 
imposed on it by DOL.
    (c) DOL may provide computer outputs to recipients to expedite or 
contribute to the accuracy of reporting. DOL may accept the required 
information from recipients in electronically reported format or 
computer printouts instead of prescribed forms.
    (d) Financial reports. (1) Financial reports for programs under 
titles I, II, and III shall be submitted to DOL by each State quarterly 
and by program year of appropriation.
    (2) Each recipient shall report program outlays on an accrual basis. 
If the recipient's accounting records are not normally kept on the 
accrual basis, the recipient shall develop such accrual information 
through an analysis of the documentation on hand.
    (3) A final financial report is required 90 days after the 
expiration of a funding period (seeSec. 627.485 of this part, 
Closeout).
    (4) Pursuant to section 104(b)(13) of the Act, the SDA shall 
annually report to the Governor. Among other items, this report shall 
include information on the extent to which the SDA has met the goals for 
the training and training-related placement of women in nontraditional 
employment.



Sec.  627.460  Requirements for records.

    (a) Records, including the records identified in section 165(g) of 
the Act, shall be retained in accordance with section 165(e) of the Act. 
In establishing the time period of record retention requirements for 
records of subrecipients, the State may either:
    (1) Impose the time limitation requirement of section 165(e) of the 
Act; or

[[Page 214]]

    (2) Require that subrecipient records for each funding period be 
retained for 3 years after the subrecipient submits to the awarding 
agency its final expenditure report for that funding period. Records for 
nonexpendable property shall be retained for a period of three years 
after final disposition of the property.
    (b) The Governor shall ensure that the records under this section 
shall be retained beyond the prescribed period if any litigation or 
audit is begun or if a claim is instituted involving the grant or 
agreement covered by the records. In these instances, the Governor shall 
ensure that the records shall be retained until the litigation, audit, 
or claim has been finally resolved.
    (c) In the event of the termination of the relationship with a 
subrecipient, the Governor or SDA or title III SSG shall be responsible 
for the maintenance and retention of the records of any subrecipient 
unable to retain them.
    (d) Record storage. Records shall be retained and stored in a manner 
which will preserve their integrity and admissibility as evidence in any 
audit or other proceeding. The burden of production and authentication 
of the records shall be on the custodian of the records.
    (e) Federal and awarding agencies' access to records--(1) Records of 
recipients and subrecipients. The awarding agency, the Department of 
Labor (including the Department of Labor's Office of Inspector General), 
and the Comptroller General of the United States, or any of their 
authorized representatives, have the right of timely and reasonable 
access to any books, documents, papers, computer records, or other 
records of recipients and subrecipients that are pertinent to the grant, 
in order to conduct audits and examinations, and to make excerpts, 
transcripts, and photocopies of such documents. This right also includes 
timely and reasonable access to recipient and subrecipient personnel for 
the purpose of interview and discussion related to such documents.
    (2) Expiration of right of access. The right of access in this 
section is not limited to the required retention period but shall last 
as long as the records are retained.



Sec.  627.463  Public access to records.

    (a) Public access. Except as provided in paragraph (b) of this 
section, records maintained by recipients or subrecipients pursuant to 
Sec.  627.460 shall be made available to the public upon request, 
notwithstanding the provisions of State or local law.
    (b) Exceptions. This requirement does not apply to:
    (1) Information, the disclosure of which would constitute a clearly 
unwarranted invasion of personal privacy; or
    (2) Trade secrets, or commercial or financial information, obtained 
from a person and privileged or confidential.
    (c) Fees. For processing of a request for a record under this 
section, a fee may be charged to the extent sufficient to recover the 
cost applicable to processing such request (section 165(a)(4)).



Sec.  627.465  Property management standards.

    (a) States and governmental subrecipients. Real property, equipment, 
supplies, and intangible property acquired or produced after July 1, 
1993, by States and governmental subrecipients with JTPA funds shall be 
governed by the definitions and property requirements in the DOL 
regulations at 29 CFR part 97, except that prior approval by the 
Department of Labor to acquire property is waived.
    (b) Nongovernmental subrecipients. Except as provided in paragraph 
(c) of this section, real and personal property, including intangible 
property, acquired or produced after July 1, 1993, by nongovernmental 
subrecipients with JTPA funds shall be governed by the definitions and 
property management standards of OMB Circular A-110, as codified by 
administrative regulations of the Department of Labor in 29 CFR Part 95, 
except that prior approval by the Department of Labor to acquire 
property is waived.
    (c) Special provisions for property acquired under subgrants to 
commercial organizations--(1) Scope. This paragraph (c) applies to real 
and personal property other than supplies that are acquired or produced 
after July 1, 1993,

[[Page 215]]

under a JTPA subgrant to a commercial organization.
    (2) Property acquired by commercial subrecipients. Title to property 
acquired or produced by a subrecipient that is a commercial organization 
shall vest in the awarding agency, provided such agency is a 
governmental entity or nongovernmental organization that is not a 
commercial organization. Property so acquired or produced shall be 
considered to be acquired or produced by the awarding agency and 
paragraph (a) or (b) of this section, as appropriate, shall apply to 
that property. If the awarding agency is also a commercial organization, 
title shall vest in the higher level, non-commercial awarding agency 
that made the subaward to the commercial subrecipient.
    (3) Approval for acquisition. A subrecipient that is a commercial 
organization shall not acquire property subject to this section without 
the prior approval of the awarding agency.
    (d) Notification to the Secretary of real property acquisitions. 
Recipients shall notify the Secretary immediately upon acquisition of 
real property with JTPA funds, including acquisitions by subrecipients. 
Such notification shall include the location of the real property and 
the Federal share percentage.
    (e) Property procured before July 1, 1993. (1) Personal or real 
property procured with JTPA funds or transferred from programs under the 
Comprehensive Employment and Training Act must be used for purposes 
authorized by the Act. Subject to the Secretary's rights to such 
property, the Governor shall maintain accountability for property in 
accordance with State procedures and the records retention requirements 
ofSec. 627.460 of this part.
    (2) The JTPA program must be reimbursed the fair market value of any 
unneeded property retained by the Governor for use in a non-JTPA 
program. The proceeds from the sale of any property or transfer of 
property to a non-JTPA program must be used for purposes authorized 
under the Act.



Sec.  627.470  Performance standards.

    (a) General. The Secretary shall prescribe performance standards for 
adult programs under title II-A, for youth programs under title II-C, 
for dislocated worker programs under title III, and for older worker 
programs under section 204(d) of the Act. Any performance standards 
developed for employment competencies shall be based on such factors as 
entry level skills and other hiring requirements.
    (b) Pursuant to instructions and time lines issued by the Secretary, 
the Governor shall:
    (1) Collect the data necessary to set performance standards pursuant 
to section 106 of the Act; and
    (2) Maintain records and submit reports required by sections 
106(j)(3), 165(a)(3), (c)(1), and (d) and 121(b)(6) of the Act.
    (c) Title II performance standards. (1) The Governor shall establish 
SDA performance standards for title II within the parameters set by the 
Secretary pursuant to sections 106(b) and (d) of the Act and apply the 
standards in accordance with section 202(c)(1)(B) of the Act.
    (2) The Governor shall establish incentive award policies pursuant 
to section 106(b)(7) of the Act, except for programs operated under 
section 204(d) of the Act. Pursuant to section 106(b)(8) of the Act, 
Governors may not consider standards relating gross program expenditures 
to performance measures in making such incentive awards.
    (3) The Governor shall provide technical assistance to SDA's failing 
to meet performance standards established by the Secretary for a given 
program year (section 106(j)(2)).
    (4)(i) If an SDA fails to meet a prescribed number of the 
Secretary's performance standards for 2 consecutive years, the Governor 
shall notify the Secretary and the service delivery area of the 
continued failure and impose a reorganization plan (section 106(j)(4)).
    (ii) The number of standards deemed to constitute failure shall be 
specified by the Secretary biennially and shall be based on an 
appropriate proportion of the total number established by the Secretary 
for that performance cycle. In determining failure, the specified 
proportion shall be applied separately to each year of the two year 
cycle.
    (iii) A reorganization plan shall not be imposed for a failure to 
meet performance standards other than those established by the 
Secretary.

[[Page 216]]

    (iv) A reorganization plan shall be considered to be imposed when, 
at a minimum:
    (A) The problem or deficiency is identified,
    (B) The problem is communicated to the SDA, and
    (C) The SDA is provided an initial statement of the actions or steps 
required and the timeframe within which they are to be initiated. A 
final statement of required steps and actions is to be issued within 30 
days.
    (d)(1) If the Governor does not impose a reorganization plan, 
required by paragraph (c)(4) of this section, within 90 days of 
notifying the Grant Officer of an SDA's continued failure to meet 
performance standards, the Grant Officer shall develop and impose such a 
plan (section 106(j)(5)).
    (2) Before imposing a reorganization plan, the Grant Officer shall 
notify the Governor and SDA in writing of the intent to impose the plan 
and provide both parties the opportunity to submit comments within 30 
days of receipt of the Grant Officer's notice.
    (e) An SDA subject to a reorganization plan under paragraphs (c)(4) 
or (d) of this section may, within 30 days of receiving notice of such 
action, appeal to the Secretary to revise or rescind the reorganization 
plan under the procedures set forth atSec. 627.471 of this subpart, 
Reorganization plan appeals (section 106(j)(6)(A)).
    (f) Secretarial action to recapture or withhold funds. (1) The Grant 
Officer shall recapture or withhold an amount not to exceed one-fifth of 
the State administration set-aside allocated under sections 202(c)(1)(A) 
and 262(c)(1)(A) of the Act when:
    (i) The Governor has failed to impose a reorganization plan under 
paragraph (c)(4) of this section, for the purposes of providing 
technical assistance under a reorganization plan imposed by the 
Secretary (section 106(j)(5)(B)); or
    (ii) The Secretary determines in an appeal provided for at paragraph 
(e) of this section, and set forth atSec. 627.471 of this subpart, 
that the Governor has not provided appropriate technical assistance as 
required at section 106(j)(2) (section 106(j)(6)(B)).
    (2)(i) A Governor of a State that is subject to recapture or 
withholding under paragraph (f)(1) of this section may, within 30 days 
of receipt of such notice, appeal such recapture or withholding to the 
Secretary.
    (ii) The Secretary may consider any comments submitted by the 
Governor and shall make a decision within 45 days after the appeal is 
received.
    (g) Title III performance standards. (1) The Governor shall 
establish SSG performance standards for programs under title III within 
the parameters set annually by the Secretary pursuant to section 106(c) 
and (d) of the Act.
    (2) Any performance standard for programs under title III shall make 
appropriate allowances for the difference in cost resulting from serving 
workers receiving needs-related payments authorized underSec. 631.20 
of this chapter (section 106(c)(2)).
    (3) The Secretary annually shall certify compliance, if the program 
is in compliance, with the title III performance standards established 
pursuant to paragraph (a) of section 322(a)(4) of the Act.
    (4) The Governor shall not establish standards for the operation of 
programs under title III that are inconsistent with the performance 
standards established by the Secretary under provisions of section 
106(c) of the Act (section 311(b)(8)).
    (5) When an SSG fails to meet performance standards for 2 
consecutive years, the Governor may institute procedures pursuant to the 
Governor's by-pass authority in accordance withSec. 631.38(b) of this 
chapter or require redesignation of the substate grantee in accordance 
withSec. 631.35 of this chapter, as appropriate.



Sec.  627.471  Reorganization plan appeals.

    (a) A reorganization plan imposed by the Governor, as provided for 
at Sec.Sec. 627.470(c)(4) or 627.477(b)(2) of this part, or by the 
Secretary, as provided for atSec. 627.470(d) of this part, may be 
appealed directly to the Secretary without prior exhaustion of local 
remedies.
    (b)(1) Appeals shall be submitted to the Secretary, U.S. Department 
of Labor, Washington, DC 20210, ATTENTION: ASET. A copy of the appeal 
shall be provided simultaneously to the Governor.

[[Page 217]]

    (2) The Secretary shall not accept an appeal dated later than 30 
days after receipt of written notification from the Governor or the 
Secretary.
    (3) The appealing party shall explain why it believes the decision 
to impose the reorganization plan is contrary to the provisions of 
section 106 of the Act.
    (4) The Secretary shall accept the appeal and make a decision only 
with regard to determining whether or not the decision to impose the 
reorganization plan is inconsistent with section 106 of the Act. The 
Secretary may consider any comments submitted by the Governor or the 
SDA, as appropriate. The Secretary shall make a final decision within 60 
days after this appeal is received (section 106(j)).



Sec.  627.475  Oversight and monitoring.

    (a) The Secretary may monitor all recipients and subrecipients of 
financial assistance pursuant to section 163 of the Act.
    (b) The Governor is responsible for oversight of all SDA and SSG 
activities and State-supported programs. The Governor shall develop and 
make available for review a State monitoring plan. The plan shall 
specify the mechanism which:
    (1) Ensures that established policies to achieve program quality and 
outcomes meet the objectives of the Act and regulations promulgated 
thereunder;
    (2) Enables the Governor to determine if SDA's and SSG's have 
demonstrated substantial compliance with the requirements for oversight;
    (3) Determines whether the Job Training Plan shall be disapproved 
consistent with the criteria contained in section 105(b)(1) of the Act;
    (4) Regularly examines expenditures against the cost categories and 
cost limitations specified in the Act and these regulations;
    (5) Ensures that all areas of SDA and SSG operations are monitored 
onsite regularly, but not less than once annually; and
    (6) Provides for corrective action to be imposed if conditions in 
paragraphs (b)(1)-(4) of this section are not met.
    (c) The Governor shall issue instructions to SDA's and title III 
SSG's on the development of a substate monitoring plan. The instructions 
for development of the monitoring plan, at a minimum, shall address the 
monitoring scope and frequency, and the Secretary's emphasis and 
direction. The substate monitoring plan shall be part of the job 
training plan.
    (d) The Governor shall establish general standards for PIC oversight 
responsibilities. The required PIC standards shall be included in the 
Governor's Coordination and Special Services Plan (GCSSP).
    (e)(1) The PIC, pursuant to standards established by the Governor, 
shall establish specific policies for monitoring and oversight of SDA 
performance which shall be described in the job training plan.
    (2) The PIC shall exercise independent oversight over activities 
under the job training plan which shall not be circumscribed by 
agreements with the appropriate chief elected official(s) of the SDA.
    (f) The PIC and chief elected official(s) may conduct such oversight 
as they, individually or jointly, deem necessary or delegate oversight 
responsibilities to an appropriate entity pursuant to their mutual 
agreement.



Sec.  627.477  Governor's determination of substantial violation.

    (a) Except as provided at paragraph (d) of this section, if, as a 
result of financial and compliance audits or otherwise, the Governor 
determines that there is a substantial violation of a specific provision 
of this Act or the regulations under this Act, and corrective action has 
not been taken, the Governor shall
    (1) Issue a notice of intent to revoke approval of all or part of 
the plan affected; or
    (2) Impose a reorganization plan, which may include
    (i) Restructuring the private industry council involved;
    (ii) Prohibiting the use of designated service providers;
    (iii) Selecting an alternative entity to administer the program for 
the service delivery area involved;
    (iv) Merging the service delivery area into 1 or more other existing 
service delivery areas; or

[[Page 218]]

    (v) Other such changes as the Secretary or Governor determines 
necessary to secure compliance (section 164(b)(1)).
    (b)(1) The actions taken by the Governor pursuant to paragraph 
(a)(1) of this section may be appealed to the Secretary as provided at 
Sec.  628.426 of this chapter (section 164(b)(2)(A)).
    (2) The actions taken by the Governor pursuant to paragraph (a)(2) 
of this section may be appealed to the Secretary, as provided atSec. 
627.471 of this part (section 164(b)(2)(B)).
    (c) Allegations that the Governor failed to promptly take the 
actions required under paragraph (a) of this section shall be handled 
underSec. 627.607 of this part (section 164(b)(3)).
    (d) This section does not apply to remedial actions for SDA failures 
to meet performance standards, which are provided for atSec. 627.470 
of this part, and do not apply to remedial actions for the failure to 
comply with procurement standards, which are provided for atSec. 
627.703 of this part.



Sec.  627.480  Audits.

    (a) Non-Federal Audits--(1) Governments. Each recipient and 
governmental subrecipient is responsible for complying with the Single 
Audit Act of 1984 (31 U.S.C. 7501-7) and 29 CFR part 96, the Department 
of Labor regulations which implement Office of Management and Budget 
(OMB) Circular A-128, ``Audits of State and Local Governments''.
    (2) Non-governmental organizations. Each non-governmental recipient 
or subrecipient shall comply with OMB Circular A-133, ``Audits of 
Institutions of Higher Education and Other Nonprofit Institutions'', as 
implemented by the Department of Labor regulations at 29 CFR part 96. 
The provisions of this paragraph (a)(2) do not apply to any non-
governmental organization that is:
    (i) A commercial organization; or
    (ii) A hospital or an institution of higher education for which 
State or local governments choose to apply OMB Circular A-128.
    (3) Commercial organizations. A commercial organization which is a 
recipient or subrecipient and which receives $25,000 or more a year in 
Federal financial assistance to operate a JTPA program shall have an 
audit that:
    (i) Is usually performed annually, but not less frequently than 
every two years;
    (ii) Is completed within one year after the end of the period 
covered by the audit and submitted to the awarding agency within one 
month after completion;
    (iii) Is either:
    (A) An independent financial and compliance audit of Federal funds 
that includes coverage of the JTPA program within its scope, and is 
conducted and prepared in accordance with generally accepted government 
auditing standards; or
    (B) An organization-wide audit that includes financial and 
compliance coverage of the JTPA program within its scope.
    (b) Federal audits. The notice of audits conducted or arranged by 
the Office of Inspector General or the Comptroller General shall be 
provided in advance, as required by section 165(b) of the Act.
    (c) Audit reports. (1) Audit reports of recipient-level entities and 
other organizations which receive JTPA funds directly from the U.S. 
Department of Labor shall be submitted to the Office of Inspector 
General.
    (2) Audit reports of organizations other than those described in 
paragraph (c)(1) of this section shall be submitted to the entity which 
provided the JTPA funds.
    (d) Each entity that receives JTPA program funds and awards a 
portion of those funds to one or more subrecipients shall:
    (1) Ensure that each subrecipient complies with the applicable audit 
requirements;
    (2) Resolve all audit findings that impact the JTPA program with its 
subrecipient and ensure that corrective action for all such findings is 
instituted within 6 months after receipt of the audit report (where 
appropriate, corrective action shall include debt collection action for 
all disallowed costs); and
    (3) Maintain an audit resolution file documenting the disposition of 
reported questioned costs and corrective actions taken for all findings. 
The ETA

[[Page 219]]

Grant Officer may request that an audit resolution report, as specified 
in paragraph (e)(2) of this section, be submitted for such audits or may 
have the audit resolution reviewed through the compliance review 
process.
    (e)(1) Audits of recipient-level entities and other organizations 
which receive JTPA funds directly from DOL and all audits conducted by 
or under contract for the Office of Inspector General shall be issued by 
the OIG to the Employment and Training Administration after acceptance 
by OIG.
    (2) After receipt of the audit report, the ETA Grant Officer shall 
request that the State submit an audit resolution report documenting the 
disposition of the reported questioned costs, i.e., whether allowed or 
disallowed, the basis for allowing questioned costs, the method of 
repayment planned or required, and corrective actions, including debt 
collection efforts, taken or planned.
    (f) If the recipient intends to propose the use of ``stand-in'' 
costs as substitutes for otherwise unallowable costs, the proposal shall 
be included with the audit resolution report. To be considered, the 
proposed ``stand-in'' costs shall have been reported as uncharged JTPA 
program costs, included within the scope of the audit, and accounted for 
in the auditee's financial system, as required bySec. 627.425 of this 
part, Standards for financial management and participant data systems. 
To be accepted, stand-in costs shall be from the same title, and program 
year as the costs which they are proposed to replace, and shall not 
result in a violation of the applicable cost limitations.
    (g) After receiving the audit resolution report, the ETA Grant 
Officer shall review the report, the recipient's disposition, and any 
liability waiver request submitted in accordance withSec. 627.704 of 
this part. If the Grant Officer agrees with all aspects of the 
recipient's disposition of the audit, the Grant Officer shall so notify 
the recipient. If the Grant Officer disagrees with the recipient's 
conclusion on specific points in the audit, the Grant Officer shall 
resolve the audit through the initial and final determination process 
described inSec. 627.606 of this part.



Sec.  627.481  Audit resolution.

    (a) Federal audit resolution. When the OIG issues an audit report to 
the Employment and Training Administration for resolution, the ETA Grant 
Officer shall provide a copy of the report to the recipient (if it does 
not already have the report), along with a request that the recipient 
submit its audit resolution report as specified inSec. 627.480(e)(2) 
of this part, unless the Grant Officer chooses to proceed directly 
against the recipient pursuant toSec. 627.601 of this part.
    (1) For audits of recipient-level entities and other organizations 
which receive JTPA funds directly from DOL, the Grant Officer shall 
request that the audit resolution report be submitted within 60 days 
from the date that the audit report is issued by the OIG.
    (2) For audits of subrecipient organizations, the Grant Officer 
shall provide the recipient with a 180-day period within which to 
resolve the audit with its subrecipient(s), and shall request that the 
audit resolution report be submitted at the end of that 180-day period.
    (b) After receiving the audit resolution report, the ETA Grant 
Officer shall review the report, the recipient's disposition, any 
liability waiver request, and any proposed ``stand-in'' costs. If the 
Grant Officer agrees with all aspects of the recipient's disposition of 
the audit, the Grant Officer shall so notify the recipient, constituting 
final agency action on the audit. If the Grant Officer disagrees with 
the recipient's conclusion on specific points in the audit, or if the 
recipient fails to submit its audit resolution report, the Grant Officer 
shall resolve the audit through the initial and final determination 
process described inSec. 627.606 of this part. Normally, the Grant 
Officer's notification of agreement (a concurrence letter) or 
disagreement (an initial determination) with the recipient's audit 
resolution report will be provided within 180 days of the Grant 
Officer's receipt of the report.
    (c) Non-Federal audit resolution. (1) To ensure timely and 
appropriate resolution for audits of all subrecipients, including SDA 
grant recipients and title III SSG's, and to ensure recipient-wide

[[Page 220]]

consistency, the Governor shall prescribe standards for audit resolution 
and debt collection policies and procedures that shall be included in 
each job training plan in accordance with section 104(b)(12) of the Act.
    (2) The Governor shall prescribe an appeals procedure for audit 
resolution disputes which, at a minimum, provides for:
    (i) The period of time, not less than 15 days nor more than 30 days, 
after the issuance of the final determination in which an appeal may be 
filed;
    (ii) The rules of procedure;
    (iii) Timely submission of evidence;
    (iv) The timing of decisions; and
    (v) Further appeal rights, if any.



Sec.  627.485  Closeout.

    (a) General. The Grant Officer shall close out each annual JTPA 
grant agreement within a timely period after the funding period covered 
by the award has expired.
    (b) Revisions to the reported expenditures for a program year of 
funds may be made until 90 days after the time limitation for 
expenditure of JTPA funds, as set forth in section 161(b) of the Act, 
has expired. The Grant Officer may extend this deadline if the recipient 
submits a written request with justification. After that time, the Grant 
Officer shall consider all reports received as final and no additional 
revisions may be made.
    (c) When closing out a JTPA grant, the Grant Officer shall notify 
the recipient, by certified mail, that, since the time limitation for 
expenditure of funds covered by the grant award has expired, it is the 
Department of Labor's intent to close the annual grant as follows:
    (1) Cost adjustment. Based on receipt of reports in paragraph (b) of 
this section, the Grant Officer shall make upward or downward 
adjustments to the allowable costs; and
    (2) Cash adjustment. DOL shall make prompt payment to the recipient 
for allowable reimbursable costs; the recipient shall promptly refund to 
DOL any balance of cash advanced that is in excess of allowable costs 
for the grant award being closed.
    (d) The recipient shall have an additional 60 days after the date of 
the notice described in paragraph (c) of this section in which to 
provide the Grant Officer with information as to the reason(s) why 
closeout should not occur.
    (e) At the end of the 60-day period described in paragraph (d) of 
this section, the Grant Officer shall notify the recipient that closeout 
has occurred, unless information provided by the recipient, pursuant to 
paragraph (d) of this section, indicates otherwise.



Sec.  627.490  Later disallowances and adjustments after closeout.

    The closeout of a grant does not affect:
    (a) The Grant Officer's right to disallow costs and recover funds on 
the basis of a later audit or other review;
    (b) The recipient's obligation to return any funds due as a result 
of later refunds, corrections, subrecipient audit disallowances, or 
other transactions;
    (c) Records retention requirements inSec. 627.460 of this part, 
Requirements for records, andSec. 627.463 of this part, Public access 
to records;
    (d) Property management requirements inSec. 627.465 of this part, 
Property management standards; and
    (e) Audit and audit resolution requirements inSec. 627.480 of this 
part, Audits andSec. 627.481 of this part, Audit resolution.



Sec.  627.495  Collection of amounts due.

    (a) Any funds paid to a recipient in excess of the amount to which 
the recipient is finally determined to be entitled under the terms of 
the grant constitute a debt to the Federal Government. If not paid 
within a reasonable period after demand, the Secretary may take any 
actions permitted by law to recover the funds.
    (b) The Secretary shall charge interest on an overdue debt in 
accordance with the Federal Claims Collection Standards (4 CFR ch. II).



      Subpart E_Grievances Procedures at the State and Local Level



Sec.  627.500  Scope and purpose.

    (a) General. This subpart establishes the procedures which apply to 
the handling of noncriminal complaints under the Act at the Governor, 
the SDA, and

[[Page 221]]

the SSG levels. Nothing contained in this subpart shall be deemed to 
prejudice the separate exercise of other legal rights in pursuit of 
remedies and sanctions available outside the Act.
    (b) Handling of discrimination complaints. Complaints of 
discrimination pursuant to section 167(a) of the Act shall be handled 
under 29 CFR part 34.
    (c) Complaints and reports of criminal fraud, waste, and abuse. 
Information and complaints involving criminal fraud, waste, abuse or 
other criminal activity shall be reported through the Department's 
Incident Reporting System, directly and immediately to the DOL Office of 
Inspector General, Office of Investigations, 200 Constitution Avenue 
NW., Room S5514, Washington, DC 20210, or to the corresponding Regional 
Inspector General for Investigations, with a copy simultaneously 
provided to the Employment and Training Administration. The Hotline 
number is 1-800-347-3756. Other complaints of a noncriminal nature will 
continue to be handled under the procedures set forth in this part, 
subparts E and F, and through the Department's Incident Reporting 
System.
    (d) Non-JTPA remedies. Whenever any person, organization, or agency 
believes that a recipient, an SDA, an SSG, or other subrecipient has 
engaged in conduct that violates the Act and that such conduct also 
violates a Federal statute other than JTPA, or a State or local law, 
that person, organization, or agency may, with respect to the non-JTPA 
cause of action, institute a civil action or pursue other remedies 
authorized under such other Federal, State, or local law against the 
recipient, the SDA, the SSG, or other subrecipient, without first 
exhausting the remedies in this subpart. Nothing in the Act or this 
chapter shall:
    (1) Allow any person or organization to file a suit which alleges a 
violation of JTPA or regulations promulgated thereunder without first 
exhausting the administrative remedies described in this subpart; or
    (2) Be construed to create a private right of action with respect to 
alleged violations of JTPA or the regulations promulgated thereunder.



Sec.  627.501  State grievance and hearing procedures for noncriminal
complaints at the recipient level.

    (a)(1) Each recipient shall maintain a recipient-level grievance 
procedure and shall ensure the establishment of procedures at the SDA 
level and the SSG level for resolving any complaint alleging a violation 
of the Act, regulations promulgated thereunder, grants, or other 
agreements under the Act. The procedures shall include procedures for 
handling complaints and grievances arising in connection with JTPA 
programs operated by each SDA, SSG, and subrecipient under the Act 
(section 144(a)).
    (2) The procedures described in paragraph (a)(1) of this section 
shall also provide for resolution of complaints arising from actions 
taken by the recipient with respect to investigations or monitoring 
reports.
    (b) The recipient's grievance hearing procedure shall require 
written notice to interested parties of the date, time, and place of the 
hearing; an opportunity to present evidence; and a written decision. For 
matters under paragraph (a)(2) of this section, the notice of hearing 
shall indicate the nature of the violation(s) which the hearing covers.



Sec.  627.502  Grievance and hearing procedures for noncriminal 
complaints at the SDA and SSG levels.

    (a) Each SDA and SSG, pursuant to guidelines established by the 
recipient, shall establish procedures for resolving complaints and 
grievances arising in connection with JTPA programs operated by the SDA, 
the SSG, and other subrecipients under the Act. The procedures also 
shall provide for resolution of complaints arising from actions taken by 
the SDA or the SSG with respect to investigations or monitoring reports 
of their subgrantees, contractors, and other subrecipients (section 
144(a)).
    (b) Each SDA and SSG grievance hearing procedure shall include 
written notice of the date, time, and place of the hearing; an 
opportunity to present evidence; a written decision; and a notice of 
appeal rights.

[[Page 222]]

    (c) The SDA and SSG procedures shall provide for a decision within 
60 days of the filing of the complaint.



Sec.  627.503  Recipient-level review.

    (a) If a complainant does not receive a decision at the SDA or the 
SSG level within 60 days of filing the complaint or receives a decision 
unsatisfactory to the complainant, the complainant shall have the right 
to request a review of the complaint by the recipient. The recipient 
shall issue a decision within 30 days of receipt of the complaint.
    (b) The recipient shall also provide for an independent review, by a 
reviewer who is independent of the JTPA program, of a complaint 
initially filed at the recipient level on which a decision was not 
issued within 60 days of receipt of a complaint or on which the 
complainant has received an adverse decision. A decision shall be made 
within 30 days of receipt by the recipient.
    (c) A request for review under the provisions of paragraphs (a) or 
(b) of this section shall be filed within 10 days of receipt of the 
adverse decision or, if no timely decision is rendered, within 15 days 
from the date on which the complainant should have received a timely 
decision.
    (d) With the exception of complaints alleging violations of the 
labor standards under section 143 of the Act, the recipient's decision 
is final unless the Secretary exercises the authority for Federal-level 
review in accordance with the provisions atSec. 627.601 of this part, 
Complaints and grievances at the Federal level. Complaints alleging 
violations of section 143 of the Act shall be handled under the 
procedures set forth atSec. 627.603 of this part, special handling of 
labor standards violations under section 143.



Sec.  627.504  Noncriminal grievance procedure at employer level.

    (a) Recipients, SDA's, SSG's, and other subrecipients shall assure 
that other employers, including private-for-profit employers of 
participants under the Act, have a grievance procedure relating to the 
terms and conditions of employment available to their participants 
(section 144(b)).
    (b)(1) Employers under paragraph (a) of this section may operate 
their own grievance system or may utilize the grievance system 
established by the recipient, the SDA, or the SSG under this subpart, 
except as provided for in paragraph (b)(2) of this section. Employers 
shall inform participants of the grievance procedures they are to follow 
when the participant begins employment.
    (2) If an employer is required to use a certain grievance procedure 
under a covered collective bargaining agreement, then those procedures 
should be followed for the handling of JTPA complaints under this 
section.
    (c) An employer grievance system shall provide for, upon request by 
the complainant, a review of an employer's decision by the SDA, or the 
SSG and the recipient if necessary, in accordance with Sec.Sec. 
627.501 and 627.502 of this part.



     Subpart F_Federal Handling of Noncriminal Complaints and Other 
                               Allegations



Sec.  627.600  Scope and purpose.

    (a) This subpart establishes the procedures which apply to the 
filing, handling, and reviewing of complaints at the Federal level. 
Nothing in the Act or this chapter shall be construed to allow any 
person or organization to join or sue the Secretary with respect to the 
Secretary's responsibilities under JTPA except after exhausting the 
remedies in subpart E of this part and this subpart F.
    (b) Complaints of discrimination pursuant to section 167(a) of the 
Act shall be handled under 29 CFR part 34.



Sec.  627.601  Complaints and allegations at the Federal level.

    (a) The types of complaints and allegations that may be received at 
the Federal level for review include:
    (1) Complaints for which the recipient has failed to issue a timely 
decision as required bySec. 627.503 of this part;
    (2) Alleged violations of the Act and/or the regulations promulgated 
thereunder resulting from Federal, State, and/or SDA and SSG monitoring 
and oversight reviews;

[[Page 223]]

    (3) Alleged violations of the labor standards provisions at section 
143 of the Act;
    (4) Alleged violations of the relocation provisions in section 
141(c) of the Act; and
    (5) Other allegations of violations of the Act or the regulations 
promulgated thereunder.
    (b) Upon receipt of a complaint or allegation alleging any of the 
violations listed in paragraph (a) of this section, the Secretary may:
    (1) Direct the recipient to handle a complaint through local 
grievance procedures established underSec. 627.502 of this part; or
    (2) Investigate and determine whether the recipient or 
subrecipient(s) are in compliance with the Act and regulations 
promulgated thereunder (section 163(b) and (c)).
    (3) Allegations of violations of sections 141(c) or 143 of the Act 
andSec. 627.503 of this part shall be handled under paragraph (b)(2) 
of this section.



Sec.  627.602  Resolution of investigative findings.

    (a)(1) As a result of an investigation or monitoring by the 
Department, or of the actions specified in paragraph (b)(2) ofSec. 
627.601 of this part, the Grant Officer shall notify the recipient of 
the findings of the investigation and shall give the recipient a period 
of time, not to exceed 60 days, depending on the nature of the findings, 
to comment and to take appropriate corrective actions.
    (2) The Grant Officer shall review the complete file of the 
investigation and the recipient's actions. The Grant Officer's review 
shall take into account the sanction provisions of subpart G of this 
part. If the Grant Officer agrees with the recipient's handling of the 
situation, the Grant Officer shall so notify the recipient. This 
notification shall constitute final agency action.
    (3) If the Grant Officer disagrees with the recipient's handling of 
the matter, the Grant Officer shall proceed pursuant toSec. 627.606 of 
this part, Grant officer resolution.



Sec.  627.603  Special handling of labor standards violations under
section 143 of the Act.

    (a) A complaint alleging JTPA section 143 violations may be 
submitted to the Secretary by either party to the complaint when:
    (1) The complainant has exhausted the grievance procedures set forth 
at subpart E of this part, or
    (2) The 60-day time period specified for reaching a decision under a 
procedure set forth at subpart E of this part has elapsed without a 
decision (section 144(a) and (d)(1)).
    (b)(1) The Secretary shall investigate the allegations contained in 
a complaint alleging violations of JTPA section 143, make a 
determination whether a violation has occurred, and issue a decision 
within 120 days of receipt by the Secretary of the complaint (section 
144(c) and (d)).
    (2) If the results of the Secretary's investigation indicate that a 
decision by a recipient under a procedure set forth at subpart E of this 
part requires modification or reversal, or that the 60-day time period 
for decision under section 144(a) has elapsed, the Secretary shall 
modify, reverse, or issue such decision.
    (3) If the Secretary modifies or reverses a decision made under a 
procedure set forth at subpart E of this part, or issues a decision 
where the 60-day time period has elapsed without a decision, the 
Secretary shall offer an opportunity for a hearing, in accordance with 
the procedures under section 166 of the Act and subpart H of this part 
(sections 144(d)(2) and 166(a)).
    (4) If the Secretary upholds a recipient's decision, the 
determination is the final decision of the Secretary (section 
144(d)(3)). This decision is not appealable to the Office of 
Administrative Law Judges.
    (c) Except as provided in paragraph (d) of this section, remedies 
available under this section to a grievant for violations of section 143 
of the Act shall be limited to:
    (1) Suspension or termination of payments under the Act;
    (2) Prohibition of placement of a participant, for an appropriate 
period of time, in a program under the Act with an employer that has 
violated section

[[Page 224]]

143 of the Act, as determined under section 144(d) or (e) of the Act; 
and/or
    (3) Appropriate equitable relief (other than back pay) (section 
144(f)(1)).
    (d) Available remedies for violations of section 143(a)(4), (b)(1), 
(b)(3), and (d) of the Act include the remedies listed in paragraph (c) 
of this section, and may include the following:
    (1) Reinstatement of the grievant to the position held prior to 
displacement;
    (2) Payment of lost wages and benefits; and/or
    (3) Reestablishment of other relevant terms, conditions, and 
privileges of employment.
    (e) Nothing in this section shall be construed to prohibit a 
grievant from pursuing a remedy authorized under another Federal, State, 
or local law for a violation of section 143 of the Act (section 144(g)).



Sec.  627.604  Alternative procedure for handling labor standards 
violations under section 143 of the Act--binding arbitration.

    (a) A person alleging a violation of section 143 of the Act, as an 
alternative to processing the grievance under a procedure described at 
section 144 of the Act, may submit the grievance to a binding 
arbitration procedure, if a collective bargaining agreement covering the 
parties to the grievance so provides (section 144(e)(1)).
    (b) A person electing to have her/his complaint on JTPA section 143 
labor standard violations processed under binding arbitration 
provisions--
    (1) Shall choose binding arbitration before, and in lieu of, 
initiating a complaint under other grievance procedures established 
pursuant to section 144 of the Act, and
    (2) May not elect binding arbitration for a complaint that 
previously has been or is subject to any other grievance procedure 
established under the Act.
    (c) Binding arbitration decisions under the provisions of section 
144(e) of the Act are not reviewable by the Secretary.
    (d) The remedies available to a grievant under binding arbitration 
are limited to those set forth at section 144(f)(1)(C) and (f)(2) of the 
Act (section 144(e)(2)).
    (e) Nothing in this section shall be construed to prohibit a 
grievant from pursuing a remedy authorized under another Federal, State, 
or local law for a violation of section 143 of the Act (section 144(g)).



Sec.  627.605  Special Federal review of SDA- and SSG-level complaints
without decision.

    (a) Should the recipient fail to provide a decision as required in 
Sec.  627.503 of this part, the complainant may then request from the 
Secretary a determination whether reasonable cause exists to believe 
that the Act or regulations promulgated thereunder have been violated.
    (b) The Secretary shall act within 90 days of receipt of a request 
made pursuant to paragraph (a) of this section. Where there is 
reasonable cause to believe the Act or regulations promulgated 
thereunder have been violated, the Secretary shall direct the recipient 
to issue a decision adjudicating the dispute pursuant to recipient and 
local procedures. The Secretary's action does not constitute final 
agency action and is not appealable under the Act (sections 166(a) and 
144(c)). If the recipient does not comply with the Secretary's order 
within 60 days, the Secretary may impose a sanction upon the recipient 
for failing to issue a decision.
    (c) A request pursuant to paragraph (a) of this section shall be 
filed no later than 15 days from the date on which the complainant 
should have received a decision as required inSec. 627.503 of this 
part. The complaint shall contain the following:
    (1) The full name, telephone number (if any), and address (if any) 
of the person making the complaint;
    (2) The full name and address of the respondent against whom the 
complaint is made;
    (3) A clear and concise statement of the facts, including pertinent 
dates, constituting the alleged violation;
    (4) The provisions of the Act, regulations promulgated thereunder, 
grant, or other agreement under the Act believed to have been violated;
    (5) A statement disclosing whether proceedings involving the subject 
of the request have been commenced or concluded before any Federal, 
State, or

[[Page 225]]

local authority, and, if so, the date of such commencement or 
conclusion, the name and address of the authority, and the style of the 
case; and
    (6) A statement of the date the complaint was filed with the 
recipient, the date on which the recipient should have issued decision, 
and an attestation that no decision was issued.
    (d)(1) A request pursuant to paragraph (a) of this section will be 
considered to have been filed when the Secretary receives from the 
complainant a written statement sufficiently precise to evaluate the 
complaint and the grievance procedure used by the recipient, the SDA, or 
the SSG.
    (2) When an imprecise request is received within the 15-day period 
prescribed in paragraph (a) of this section, the Secretary may extend 
the period for submission.



Sec.  627.606  Grant Officer resolution.

    (a) When the Grant Officer is dissatisfied with the State's 
disposition of an audit, as specified inSec. 627.481 of this part, or 
other resolution of violations (including those arising out of incident 
reports or compliance reviews), with the recipient's response to 
findings resulting from investigations pursuant toSec. 627.503 of this 
part, or if the recipient fails to comply with the Secretary's decision 
pursuant toSec. 627.605(b) of this part, the initial and final 
determination process shall be used to resolve the matter.
    (b) Initial determination. The Grant Officer shall make an initial 
determination on the findings for both those matters where there is 
agreement and those where there is disagreement with the recipient's 
resolution, including the allowability of questioned costs or 
activities. Such initial determination shall be based upon the 
requirements of the Act, regulations promulgated thereunder, grants, 
contracts, or other agreements under the Act.
    (c) Informal resolution. The Grant Officer shall not revoke a 
recipient's grant in whole or in part, nor institute corrective actions 
or sanctions, without first providing the recipient with an opportunity 
to present documentation or arguments to resolve informally those 
matters in controversy contained in the initial determination. The 
initial determination shall provide for an informal resolution period 
which shall be at least 60 days from issuance of the initial 
determination. If the matters are resolved informally, the Grant Officer 
shall issue a final determination pursuant to paragraph (d) of this 
section which notifies the parties in writing of the nature of the 
resolution and may close the file.
    (d) Grant Officer's final determination. (1) If the matter is not 
fully resolved informally, the Grant Officer shall provide each party 
with a written final determination by certified mail, return receipt 
requested. For audits of recipient-level entities and other recipients 
which receive JTPA funds directly from DOL, ordinarily the final 
determination will be issued not later than 180 days from the date that 
the OIG issues the final approved audit report to the Employment and 
Training Administration. For audits of subrecipients conducted by the 
OIG, ordinarily the final determination will be issued not later than 
360 days from the date the OIG issues the final approved audit report to 
ETA.
    (2) A final determination under this paragraph (d) shall:
    (i) Indicate that efforts to informally resolve matters contained in 
the initial determination have been unsuccessful;
    (ii) List those matters upon which the parties continue to disagree;
    (iii) List any modifications to the factual findings and conclusions 
set forth in the initial determination;
    (iv) Establish a debt, if appropriate;
    (v) Require corrective action when needed;
    (vi) Determine liability, method of restitution of funds and 
sanctions; and
    (vii) Offer an opportunity for a hearing in accordance with subpart 
H of this part.
    (3) Unless a hearing is requested, a final determination under this 
paragraph (d) constitutes final agency action and is not subject to 
further review.
    (e) Nothing in this section shall preclude the Grant Officer from 
issuing an initial determination and/or final determination directly to 
a subrecipient, in accordance with section 164(e)(3) of

[[Page 226]]

the Act. In such a case, the Grant Officer shall inform the recipient of 
such action.



Sec.  627.607  Grant Officer resolution of Governor's failure to 
promptly take action.

    (a) An allegation, whether arising from a complaint, from monitoring 
or other information available to the Department, that a Governor failed 
to promptly take remedial action of a substantial violation of the Act 
or the regulations under this Act, as required bySec. 627.477 of this 
part, shall be promptly investigated by the Department.
    (b) The Grant Officer shall notify the Governor of the findings of 
the investigation or monitoring and shall give the Governor a period of 
time, not to exceed 30 days, to comment on the nature of the findings 
and to take appropriate corrective actions.
    (c) The Grant Officer shall review the complete file of the 
investigation, monitoring, and the Governor's actions.
    (d) If the Grant Officer determines that, (1) as a result financial 
and compliance audits or otherwise, the Governor determined that there 
was a substantial violation of a specific provision of the Act or the 
regulations under this Act, and corrective action had not been taken 
and, (2) the Grant Officer determines that the Governor has not taken 
the actions required bySec. 627.477(a), the Grant Officer shall take 
such actions required bySec. 627.477(a).
    (e) The Grant Officer's determination, unless a hearing is 
requested, constitutes final agency action and is not subject to further 
review. (Section 164(b)(3)).



              Subpart G_Sanctions for Violations of the Act



Sec.  627.700  Purpose and scope.

    This subpart describes the sanctions and appropriate corrective 
actions that may be imposed by the Secretary for violations of the Act, 
regulations promulgated thereunder, or grant terms and conditions 
(sections 106(j)(5), 164 (b), (d), (e), (f), (g), and (h)).



Sec.  627.702  Sanctions and corrective actions.

    (a) Except for actions under sections 106(j), 164 (b) and (f), and 
167 of the Act and the funding restrictions specified atSec. 627.423 
of this part, Funding restrictions for ``high-risk'' recipients and 
subrecipients, the Grant Officer shall utilize initial and final 
determination procedures outlined inSec. 627.606, Grant Officer 
resolution, of this part to impose a sanction or corrective action.
    (b) To impose a sanction or corrective action regarding a violation 
of section 167 of the Act, the Department shall utilize the procedures 
of 29 CFR part 34.
    (c) To impose a sanction or corrective action for failure to meet 
performance standards, where the recipient has not acted as required at 
section 106(j)(4), the Grant Officer shall utilize the procedures set 
forth atSec. 627.470 (d) and (f).
    (d) To impose a sanction or corrective action for noncompliance with 
the procurement standards provisions set forth at Sec.Sec. 627.420 and 
627.703 of this part, where the recipient has not acted, the Grant 
Officer may utilize the procedures set forth at section 164(b) of the 
Act.
    (e) To impose a sanction or corrective action for the Governor's 
failure to promptly take remedial action of a substantial violation as 
required bySec. 627.477 of this part, the Grant Officer shall utilize 
the procedure set forth inSec. 627.607 of this part.
    (f) The recipient shall be held responsible for all funds under its 
grant(s). The recipient shall hold subrecipients, including SDA's and 
SSG's, responsible for JTPA funds received through the grant, and may 
ultimately hold the units of local government which constitute the SDA 
or the SSG responsible for such funds.
    (g) Nothing in this section shall preclude the Grant Officer from 
imposing a sanction directly against a subrecipient, as authorized in 
section 164(e)(3) of the Act. In such a case, the Grant Officer shall 
inform the recipient of such action.

[[Page 227]]



Sec.  627.703  Failure to comply with procurement provisions.

    (a) If, as part of the recipient's annual on-site monitoring of its 
SDA's/SSG's, the recipient determines that an SDA/SSG is not in 
compliance with the procurement requirements established in accordance 
with the provisions at section 164(a)(3) of the Act andSec. 627.420, 
of this part, Procurement, andSec. 627.422 of this part, Selection of 
service providers, the recipient shall:
    (1) Require corrective action to secure prompt compliance; and
    (2) Impose the sanctions provided for under the provisions at 
section 164(b) if the recipient finds that the SDA/SSG has failed to 
take timely corrective action under paragraph (a)(1) of this section 
(section 164(a) (4) and (5)).
    (b) An action by the recipient to impose a sanction against either 
an SDA or SSG, in accordance with this section, may be appealed to the 
Secretary under the same terms and conditions as the disapproval of the 
respective plan, or plan modification, as set forth atSec. 628.426(e), 
Review and approval (section 164(b)(2)).
    (c) If, upon a determination under paragraph (a)(2) of this section 
to impose a sanction under section 164(b) of the Act, the recipient 
fails to promptly take the actions required under paragraph (a)(2) of 
this section, the Secretary shall take such actions against the 
recipient or the SDA/SSG as appropriate (section 164(b)(3)).



Sec.  627.704  Process for waiver of State liability.

    (a) A recipient may request a waiver of liability as described in 
section 164(e)(2) of the Act.
    (b)(1) When the debt for which a waiver of liability is desired was 
established in a non-Federal resolution, such requests shall be 
accompanied by a resolution report.
    (2) When the ETA Grant Officer is resolving the finding(s) for which 
a waiver of liability is desired, such request shall be made no later 
than the informal resolution period described inSec. 627.606(c) of 
this part.
    (c) A waiver of the recipient's liability can only be considered by 
the Grant Officer when the misexpenditure of JTPA funds:
    (1) Occurred at a subrecipient level;
    (2) Was not a violation of section 164(e)(1) of the Act, or did not 
constitute fraud; or
    (3) If fraud did exist, it was perpetrated against the recipient/
subrecipient; and:
    (i) The recipient/subrecipient discovered, investigated, reported, 
and prosecuted the perpetrator of said fraud; and
    (ii) After aggressive debt collection action, it can be documented 
that there is no likelihood of collection from the perpetrator of the 
fraud.
    (4) The recipient has issued a final determination which disallows 
the misexpenditure, the recipient's appeal process has been exhausted, 
and a debt has been established; and
    (5) The recipient requests such a waiver and provides documentation 
to demonstrate that it has substantially complied with the requirements 
of section 164(e)(2)(A), (B), (C), and (D) of the Act.
    (d) The recipient shall not be released from liability for misspent 
funds under the determination required by section 164(e) of the Act 
unless the Grant Officer determines that further collection action, 
either by the recipient or subrecipient, would be inappropriate or would 
prove futile.



Sec.  627.706  Process for advance approval of a recipient's 
contemplated corrective actions.

    (a) The recipient may request advance approval from the Grant 
Officer for contemplated corrective actions, including debt collection 
actions, which the recipient plans to initiate or to forego. The 
recipient's request shall include a description and an assessment of all 
actions taken by the subrecipient to collect the misspent funds.
    (b) Based on the recipient's request, the Grant Officer may 
determine that the recipient may forego certain collection actions 
against a subrecipient where:
    (1) The subrecipient was not at fault with respect to the liability 
criteria set forth in section 164(e)(2)(A), (B), (C), and (D) of the 
Act;
    (2) The misexpenditure of funds:

[[Page 228]]

    (i) Was not made by that subrecipient but by an entity that received 
JTPA funds from that subrecipient;
    (ii) Was not a violation of section 164(e)(1) of the Act, or did not 
constitute fraud; or
    (iii) If fraud did exist, it was perpetrated against the 
subrecipient, and:
    (A) The subrecipient discovered, investigated, reported, and 
prosecuted the perpetrator of said fraud; and
    (B) After aggressive debt collection action, it can be documented 
that there is no likelihood of collection from the perpetrator of the 
fraud.
    (3) A final determination which disallows the misexpenditure and 
establishes a debt has been issued at the appropriate level;
    (4) Final action within the recipient's appeal system has been 
completed; and
    (5) Further debt collection action by that subrecipient or the 
recipient would be either inappropriate or futile.



Sec.  627.708  Offset process.

    (a) In accordance with section 164(d) of the Act, the primary 
sanction for misexpenditure of JTPA funds is repayment.
    (b) A recipient may request that a debt, or a portion thereof, be 
offset against amounts allotted to the recipient, and retained at the 
recipient level for administrative costs, under the current or a future 
JTPA entitlement.
    (1) For title II grants, any offset shall be applied against the 
recipient level 5 percent administrative cost set-aside only and may not 
be distributed by the recipient among its subrecipients.
    (2) For title III grants, any such offset must be applied against 
that portion of funds reserved by the recipient for recipient level 
administration only and may not be distributed by the recipient among 
its subrecipients.
    (c) The Grant Officer may approve an offset request, under section 
164(d) of the Act, if the misexpenditures were not in violation of 
section 164(e)(1) of the Act.
    (d) If offset is granted, the debt shall not be fully satisfied 
until the Grant Officer reduces amounts allotted to the State by the 
amount of the misexpenditure.
    (e) The recipient shall not have the authority to reduce allocations 
to an SDA or SSG for misexpenditure of JTPA funds under section 164(d) 
of the Act.



      Subpart H_Hearings by the Office of Administrative Law Judges



Sec.  627.800  Scope and purpose.

    (a) The jurisdiction of the Office of the Administrative Law Judges 
(OALJ) extends only to those complainants identified in sections 141(c), 
144(d), 164(f), and 166(a) of the Act.
    (b) Actions arising under section 167 of the Act shall be handled 
under 29 CFR part 34.
    (c) All other disputes arising under the Act shall be adjudicated 
under the appropriate recipient or subrecipient grievance procedures or 
other applicable law.



Sec.  627.801  Procedures for filing request for hearing.

    (a) Within 21 days of receipt of a final determination imposing a 
sanction or corrective action or denying financial assistance, the 
applicant, the recipient, the SDA, the SSG, or other subrecipient, or a 
vendor against which the Grant Officer has imposed a sanction or 
corrective action may appeal the Grant Officer's determination to the 
OALJ. A request for a hearing shall be transmitted by certified mail, 
return receipt requested, to the Chief Administrative Law Judge, U.S. 
Department of Labor, 800 K Street, NW., Suite 400, Washington, DC 20001, 
with one copy to the departmental official who issued the determination.
    (b) The 21-day filing requirement in paragraph (a) of this section 
is jurisdictional. Failure to timely request a hearing acts as a waiver 
of the right to hearing.
    (c) A request for a hearing under this section shall state 
specifically those issues of the final determination upon which review 
is requested. Those provisions of the final determination not specified 
for review, or the entire final determination when no hearing has been 
requested within the 21 days, shall be considered resolved and not 
subject to further review. Only alleged violations of the Act, 
regulations promulgated thereunder, grant or other agreement under the 
Act fairly raised in the

[[Page 229]]

determination and the request for hearing are subject to review.
    (d) The procedures set forth in this subpart apply in the case of a 
complainant who has not had a dispute adjudicated under the alternative 
dispute resolution process set forth inSec. 627.805 of this part 
within 60 days, except that the request for hearing before the OALJ must 
be filed within 15 days of the conclusion of the 60-day period. In 
addition to including the final determination upon which review is 
requested, the complainant shall include a copy of any Stipulation of 
Facts and a brief summary of proceedings.



Sec.  627.802  Rules of procedure.

    (a) The rules of practice and procedure promulgated by the OALJ, at 
subpart A of 29 CFR part 18, shall govern the conduct of hearings under 
this section, except that a request for hearing under this section shall 
not be considered a complaint to which the filing of an answer by DOL or 
a DOL agency or official is required. Technical rules of evidence shall 
not apply to hearings conducted pursuant to this part; however, rules or 
principles designed to assure production of the most credible evidence 
available and to subject testimony to cross-examination shall apply.
    (b) Prehearing procedures. In all cases, the ALJ should encourage 
the use of prehearing procedures to simplify and to clarify facts and 
issues.
    (c) Subpoenas. Subpoenas necessary to secure the attendance of 
witnesses and the production of documents or things at hearings shall be 
obtained from the ALJ and shall be issued pursuant to the authority 
contained in section 163(b) of the Act, incorporating 15 U.S.C. 49.
    (d) Timely submission of evidence. The ALJ shall not permit the 
introduction at the hearing of any documentation if such documentation 
has not been made available for review by the other parties to the 
proceeding either at the time ordered for any prehearing conference, or, 
in the absence of such an order, at least 3 weeks prior to the hearing 
date.
    (e) Burden of production. The Grant Officer shall have the burden of 
production to support her or his decision. To this end, the Grant 
Officer shall prepare and file an administrative file in support of the 
decision which shall be made part of the record. Thereafter, the party 
or parties seeking to overturn the Grant Officer's decision shall have 
the burden of persuasion.



Sec.  627.803  Relief.

    In ordering relief, the ALJ shall have the full authority of the 
Secretary under section 164 of the Act.



Sec.  627.804  Timing of decisions.

    The ALJ should render a written decision not later than 90 days 
after the closing of the record.



Sec.  627.805  Alternative dispute resolution.

    (a) Parties to a complaint underSec. 627.801 of this part, 
Procedures for filing a request for hearing, may choose to waive their 
rights to an administrative hearing before the OALJ by choosing to 
transfer the settlement of their dispute to an individual acceptable to 
all parties for the purpose of conducting an informal review of the 
stipulated facts and rendering a decision in accordance with applicable 
law. A written decision will be issued within 60 days after the matter 
is submitted for informal review.
    (b) The waiver of the right to request a hearing before the OALJ may 
be revoked if a settlement has not been reached or a decision has not 
been issued within the 60 days provided in paragraph (a) of this 
section.
    (c) The decision rendered under this informal review process shall 
be treated as a final decision of an Administrative Law Judge pursuant 
to section 166(b) of the Act.



Sec.  627.806  Other authority.

    Nothing contained in this subpart shall be deemed to prejudice the 
separate exercise of other legal rights in pursuit of remedies and 
sanctions available outside the Act.



                     Subpart I_Transition Provisions



Sec.  627.900  Scope and purpose.

    (a) Regulations set forth at parts 626, 627, 628, 629, 630, 631, and 
637 of 20 CFR

[[Page 230]]

chapter V (1993) were amended, effective December 29, 1992, and were 
published as an interim final rule to provide planning guidance for 
States and SDA's on the changes made to the JTPA program as a result of 
the 1992 JTPA amendments (See 57 FR 62004 (December 29, 1992)). The 
transition provisions of the regulations were amended on June 3, 1992 
(see 58 FR 31472, June 3, 1993). Those regulations and the statutory 
amendments were effective for the program year beginning July 1, 1993 
(PY 1993), and succeeding program years. For PY 1992, JTPA programs and 
activities shall continue under the regulations set forth at 20 CFR 
parts 626, 627, 628, 629, 630, 631, and 637 (1992).
    (b) In order to provide for the orderly transition to and 
implementation of the provisions of JTPA, as amended by the 1992 
amendments, this subpart I applies to the use of JTPA title II and title 
III funds allotted by formula to the States. Additional guidance on 
transition matters may be provided in administrative issuances. The 
provisions in this subpart are operational during the transition period 
for implementing the 1992 JTPA amendments.



Sec.  627.901  Transition period.

    The transition period ended June 30, 1993 unless otherwise stated. 
The intent of the transition period is to complete, to the extent 
possible, activity begun on or before June 30, 1993 under current policy 
and regulations and to ensure that all requirements mandated by the 1992 
JTPA amendments have been implemented.



Sec.  627.902  Governor's actions.

    The following are actions required to be taken prior to July 1, 
1993:
    (a) Review current policies, practices, procedures, and delivery 
systems to ensure that they conform to the requirements of the 
amendments;
    (b) Modify the Governor's coordination and special services plan in 
accordance with instructions issued by the Secretary;
    (c) Ensure that SDAs modify job training plans as necessary;
    (d) Execute a new Governor/Secretary agreement and a new grant 
agreement;
    (e) Issue procurement standards that comply with the Act and these 
regulations, as described inSec. 627.420 of this part, Procurement;
    (f) Issue instructions necessary to implement program year 1993 cost 
categories pursuant toSec. 627.440 of this part, Classification of 
costs;
    (g) Issue instructions necessary for SDAs to report program 
expenditures by year of appropriation pursuant toSec. 627.455 of this 
part, Reports required;
    (h) Certify private industry councils pursuant toSec. 628.410 of 
this chapter, Private Industry Council.



Sec.  627.903  Actions which are at the discretion of the Governor.

    (a) Establish a State Human Resource Investment Council (HRIC);
    (b) Issue instructions to ``grandparent'' participants in JTPA 
programs as of June 30, 1993 for purposes of completing training;
    (c) Issue instructions for use of PY 1992 and prior year 6 percent 
performance standards incentive funds to further develop and implement 
data collection and management information systems to track the program 
experience of participants. PY 1993 and subsequent performance standards 
incentive funds may not to be used for this purpose;
    (d) Of the Title II and Title III unobligated balance of funds 
available as of June 30, 1993, any amount may be reprogrammed into PY 
1993 activity. The Department believes these amounts will be minimal and 
not represent a significant proportion of the funds available. Such 
reprogrammed funds will be subject to requirements contained in JTPA 
regulations effective July 1, 1993.



Sec.  627.904  Transition and implementation.

    (a) Review. The Governor shall conduct a comprehensive review of the 
current policies, procedures, and delivery systems relating to programs 
authorized under the Job Training Partnership Act for the purpose of 
ensuring the effective implementation of the amendments. Such a review 
shall include consideration of the appropriateness of current SDA 
designations, the representation on current State and

[[Page 231]]

local councils, the adequacy of current administrative systems, the 
effectiveness of current outreach, service delivery, and coordination 
activities, and other relevant matters.
    (b) Governor's Coordination and Special Services Plan (GCSSP). The 
GCSSP requires modification to assure conformance to the requirements of 
the amendments. The plan was to be modified pursuant to instructions 
issued by the Secretary and shall be submitted to the Secretary for 
review by May 15, 1993.
    (c) Job training plans. Service delivery area job training plans 
will require modification to comply withSec. 628.420 of this chapter, 
Job training plan.
    (d) Governor/Secretary agreement and grant agreement. A new 
Governor/Secretary agreement is required to assure that the State shall 
comply with JTPA, as amended, and the applicable rules and regulations; 
the Wagner-Peyser Act, as amended, and the applicable rules and 
regulations. A new grant agreement is needed to provide the basis for 
Federal obligation of funds for programs authorized by Titles I, II, and 
III, and such other funds as the Secretary may award under the grant.
    (e) Procurement standards. In order to ensure fiscal accountability 
and prevent waste, fraud, and abuse in programs administered under JTPA, 
as amended, the Governor shall prescribe and implement procurement 
standards meeting the requirements ofSec. 627.420 of this part, 
Procurement. All procurements initiated on or after July 1, 1993 shall 
be governed by and follow the requirements inSec. 627.420 of this 
part. Initiation of procurement means any sole source or small purchase 
awarded on or after July 1, 1993 and any Invitation for Bid or Request 
for Proposal issued on or after July 1, 1993.
    (f) Participants. In order to have the least possible disruption to 
program participants, during PY 1993, Governors and SDAs have the 
flexibility to grandfather participants already enrolled in JTPA 
programs up to and including June 30, 1993 under existing rules and 
regulations. All participants in programs on June 30, 1993, will be 
eligible for transfer to programs operated under the new provisions at 
any time beginning on July 1, 1993. ``Hard to serve'' barriers to 
participation, assessment and Individual Service Strategy provisions of 
the amendments will not apply to participants enrolled prior to July 1, 
1993 or to 1993 Title II-B participants.
    (g) Cost categories. (1) Cost categories applicable to PY 1992 and 
earlier funds will be subject to prior regulations either until the 
funds have been exhausted or program activity has been completed. In 
order to assist the orderly transition to and implementation of the new 
requirements of the 1992 JTPA amendments, an increase is allowed in the 
administrative cost limitation for PY 1992 funds from 15 percent to 20 
percent, with a corresponding adjustment to cost limitations for 
training and participant support. Specifically, not less than 80 percent 
of the title II-A funds shall be expended for training and participant 
support, and not less than 65 percent shall be expended for training.
    (2) Any prior year's carryover funds made available for use in PY 
1993 will be subject to the reporting requirements and cost categories 
applicable to PY 1993 funds.
    (3) In determining compliance with the JTPA cost limitations for PY 
1992, Governors may either:
    (i) Determine cost limitation compliance separately for funds 
expended in accordance with paragraphs (g)(1) and (g)(2) of this 
section; or
    (ii) Determine compliance for each cost category against the total 
PY 1992 funds, whether expended in accordance with the Act and 
regulations in effect prior to the 1992 amendments to JTPA or in 
accordance with the amended Act and these regulations. Using this 
option, the total combined funds expended for training and direct 
training should be at least 65 percent of PY 1992 SDA allocations.
    (4) In addition to the institutions specified inSec. 
627.440(d)(1)(vi)(B), the costs of tuition and entrance fees of a 
postsecondary vocational institution specified at section 481(c) of the 
Higher Education Act (20 U.S.C. 1088(c)) may be charged to direct 
training services through June 30, 1995, when such tuition charges or 
entrance fees are not

[[Page 232]]

more than the educational institution's catalog price, are necessary to 
receive specific training, are charged to the general public to receive 
such training, and are for the training of participants.
    (h) Financial reporting. Notwithstanding reprogramming, expenditures 
must be recorded separately by year of appropriation.
    (i) Private Industry Council. The private industry councils shall be 
certified pursuant toSec. 628.410 of this chapter, Private Industry 
Council.
    (j) Grievances, investigations, and hearings. Generally, all 
grievances, investigations and hearings pending on or before June 30, 
1993 should be resolved and settled under prior rules and procedures. 
Grievances, investigations, and hearings occurring on or after July 1, 
1993 will be governed by the procedures described in subparts E, F, and 
H of this part 627.
    (k) Summer program. (1) The Title II-B Summer Youth Employment 
Program for 1993 shall be governed by the Act and regulations in effect 
prior to the Amendments (prior to September 7, 1992).
    (2) Up to 10 percent of the 1993 title II-B funds available may be 
transferred to the title II-C program.
    (l) SDA designation. At the Governor's discretion, SDA's designated 
prior to July 1, 1992 need not be subject to the provisions ofSec. 
628.405, Service delivery areas.
    (m) Program implementation. The implementation by the States and 
SDA's of certain new program design requirements, particularly objective 
assessment and development of individual service strategies (ISS), may 
require additional time to fully implement beyond July 1, 1993. 
Reasonable efforts to implement the provisions of Sec.Sec. 628.515, 
628.520, and 628.530. as soon as possible after July 1, 1993, are 
expected to be made. However, it is not expected that every new 
participant will initially receive objective assessment, ISS, and 
referral to non-title II services for a period of 6 months, or until 
January 1, 1994.
    (n) Out-of-school youth ratio. The 50-percent out-of-school 
participants requirement for title II-C will be phased in during PY 1993 
and will not be the subject of compliance review until PY 1994, 
beginning July 1, 1994. During PY 1993, however, SDA's must show 
significant improvement in the proportion of out-of-school youth being 
served and performance in increasing the service ratio will be monitored 
by the States and DOL during this implementation period.
    (o) Administrative issuances. Other implementation issues may be 
handled by administrative issuance. ETA will transmit such guidance 
directly to all Governors via a Training and Employment Guidance Letter 
(TEGL). Such TEGL's will be published as Notices in the Federal Register 
(section 701(i)).



Sec.  627.905  Guidance on contracts and other agreements.

    The Department does not intend for contracts, agreements, inter-
agency agreements, retainers, and similar arrangements to be negotiated 
and/or entered into for the sole purpose of applying previously existing 
rules and regulations. The 1992 JTPA amendments were effective July 1, 
1993. The Department intends that contracts, awards and agreements 
entered into on or before June 30, 1993 are to be used to serve and/or 
train participants enrolled on or before June 30, 1993, unless the 
contracts and agreements are modified to comply with the new amendments 
and regulations.



Sec.  627.906  Determinations on State and SDA implementation.

    (a) The Department expects that the States and SDA's will fully 
implement the provisions of the Act and these regulations regarding 
procurement, cost principles, cost categories, cost limitations, 
participant service requirements and eligibility beginning July 1, 1993.
    (b) The Department expects that the implementation by the States and 
SDA's of the program design features in these regulations, particularly 
objective assessment and development of the ISS, may require additional 
time beyond July 1, 1993 to fully implement.
    (c) In deciding to allow or disallow questioned costs related to the 
implementation of the provisions described in paragraph (b) of this 
section, the Grant Officer will consider the extent to which the State's 
and SDA's have

[[Page 233]]

made good faith efforts in properly implementing such provisions in the 
period July 1, 1993 through June 30, 1994.



PART 628_PROGRAMS UNDER TITLE II OF THE JOB TRAINING PARTNERSHIP ACT
--Table of Contents



                       Subpart A_Scope and Purpose

Sec.
628.100 Scope and purpose of part 628.

                        Subpart B_State Planning

628.200 Scope and purpose.
628.205 Governor's coordination and special services plan.
628.210 State Job Training Coordinating Council.
628.215 State Human Resource Investment Council.

                        Subpart C_State Programs

628.300 Scope and purpose.
628.305 State distribution of funds.
628.310 Administration.
628.315 Education coordination and grants.
628.320 Services for older individuals.
628.325 Incentive grants, capacity building and technical assistance.

                 Subpart D_Local Service Delivery System

628.400 Scope and purpose.
628.405 Service delivery areas.
628.410 Private Industry Council.
628.415 Selection of SDA grant recipient and administrative entity.
628.420 Job training plan.
628.425 Review and approval.
628.426 Disapproval or revocation of the plan.
628.430 State SDA submission.

Subpart E_Program Design Requirements for Programs Under Title II of the 
                      Job Training Partnership Act

628.500 Scope and purpose.
628.505 Eligibility.
628.510 Intake, referrals, and targeting.
628.515 Objective assessment.
628.520 Individual service strategy.
628.525 Limitations.
628.530 Referrals of participants to non-title II programs.
628.535 Limitations on job search assistance.
628.540 Volunteer program.
628.545 Linkages and coordination.
628.550 Transfer of funds.

                       Subpart F_The Adult Program

628.600 Scope and purpose.
628.605 Eligibility.
628.610 Authorized services.

       Subpart G_The Summer Youth Employment and Training Program

628.700 Scope and purpose.
628.701 Program goals and objectives.
628.702 Eligibility.
628.705 SYETP authorized services.
628.710 Period of program operation.

                    Subpart H_Youth Training Program

628.800 Scope and purpose.
628.803 Eligibility.
628.804 Authorized services.

    Authority: 29 U.S.C. 1579(a).

    Source: 59 FR 45845, Sept. 2, 1994, unless otherwise noted.



                       Subpart A_Scope and Purpose



Sec.  628.100  Scope and purpose of part 628.

    (a) This part sets forth requirements for implementation of programs 
under title II of the Job Training Partnership Act, and includes the 
councils described in subpart B that have responsibilities under titles 
I, II, and III. In this part, the provisions generally pertaining to 
title II are covered in subparts B, C, D, and E. Matters specific to 
titles IIA, II-B, or II-C are addressed in subparts F, G, or H, 
respectively.
    (b) Title II-A Adult Training programs are to prepare adults for 
participation in the labor force by providing job training and other 
services that will result in increased employment and earnings, 
increased occupational and educational skills, reduced welfare 
dependency, and result in improved long-term employability.
    (c) Title II-B Summer Youth Employment and Training programs are to 
provide eligible youth with exposure to the world of work, to enhance 
the basic education skills of youth, to encourage school completion or 
enrollment in supplemental or alternative school programs and to enhance 
the citizenship skills of youth.
    (d) Title II-C Youth Training programs are to improve the long-term 
employability of youth; to enhance the educational, occupational and 
citizenship skills of youth; to encourage school completion or 
enrollment in alternative school programs; to increase

[[Page 234]]

the employment and earnings of youth; to reduce welfare dependency; and 
to assist youth in addressing problems that impair their ability to make 
successful transition from school to work, to apprenticeship, to the 
military or to postsecondary education and training.



                        Subpart B_State Planning



Sec.  628.200  Scope and purpose.

    This subpart provides requirements for the submission of the 
Governor's Coordination and Special Services Plan, as well as the 
procedures for plan review. This subpart also contains requirements for 
the composition and responsibilities of the State Job Training 
Coordinating Council and the State Human Resource Investment Council.



Sec.  628.205  Governor's coordination and special services plan.

    (a)(1) Submittal. By a date established by the Secretary, each State 
seeking financial assistance under the Act shall submit to the 
Secretary, biennially, the Governor's coordination and special services 
plan (GCSSP) encompassing two program years (section 121(a)).
    (2) The GCSSP shall address the requirements of section 121(b) of 
the Act, including a description of the Governor's coordination 
criteria; the measures taken by the State to ensure coordination and 
prevent duplication with the Job Opportunities and Basic Skills (JOBS) 
program; the certification of the implementation of the procurement 
system, as required at section 164(a)(6) of the Act; the technical 
assistance and training plan; goals, and the efforts to accomplish such 
goals, for the training and placement of women in nontraditional 
employment and apprenticeship; the projected use of resources, including 
oversight of program performance; program administration; program 
financial management and audit resolution procedures; capacity building; 
priorities and criteria for State incentive grants; and performance 
goals for State supported programs (section 121(b)).
    (b) GCSSP review. The Secretary shall review the GCSSP for overall 
compliance with the provisions of the Act. If the GCSSP is disapproved, 
the Secretary shall notify the Governor, in writing, within 45 days of 
submission of the reasons for disapproval so that the Governor may 
modify the plan to bring it into compliance with the Act (section 
121(d)).
    (c) Information to SDA's. (1) In the year preceding the program 
years for which the plan is developed, the State shall make available to 
the SDA's in the State information on its plans to undertake State 
activities in program areas including education coordination grants, 
services to older workers, and capacity building.
    (2) The information described in paragraph (c)(1) of this section 
shall be provided to SDA's in sufficient time for SDA's to take it into 
consideration in developing local job training plans.



Sec.  628.210  State Job Training Coordinating Council.

    (a) The Governor shall appoint a State Job Training Coordinating 
Council (SJTCC) pursuant to section 122 of the Act. In lieu of a SJTCC, 
the Governor may establish and utilize a State Human Resource Investment 
Council (HRIC) pursuant to section 701 of the Act and in accordance with 
Sec.  628.215 of this part.
    (b) Consistent with section 122(a)(3) of the Act, the SJTCC shall be 
composed as follows: 30 percent, business and industry representatives; 
30 percent, State and local government and local education agency 
representatives; 30 percent, organized labor and community-based 
organization representatives; and 10 percent, representatives from the 
general public. The SJTCC shall have the specific functions and 
responsibilities outlined in sections 122, 317, and 501 of the Act.
    (c) Funding for the SJTCC shall be provided pursuant to sections 
202(c)(1)(A) and 262(c)(1)(A) of the Act.
    (d) The SJTCC shall:
    (1) Analyze the SDAs' reports made pursuant to section 104(b)(13) of 
the Act and make recommendations for technical assistance and corrective 
action, and
    (2) Prepare a summary of such reports and disseminate them to SDA's 
and service providers in the State and to the Secretary (section 
122(a)(5) and (6)).

[[Page 235]]



Sec.  628.215  State Human Resource Investment Council.

    (a) Establishment and responsibilities. The State may, in accordance 
with sections 701, 702, and 703 of the Act, establish a State Human 
Resource Investment Council (HRIC). The HRIC's responsibilities are 
described at section 701(a) of the Act. The HRIC shall carry out the 
following responsibilities:
    (1) Review the provision of services and the use of funds and 
resources under applicable Federal human resource programs and advise 
the Governor on methods of coordinating such provision of services and 
use of funds and resources consistent with the laws and regulations 
governing such programs;
    (2) Advise the Governor on the development and implementation of 
State and local standards and measures relating to applicable Federal 
human resource programs and coordination of such standards and measures; 
and
    (3) Carry out the duties and functions prescribed for existing State 
councils described under the laws relating to the applicable Federal 
human resource programs, including the responsibilities of the State 
Council on Vocational Education (SCOVE) under Section 112 of the Carl D. 
Perkins Vocational and Applied Technology Education Act.
    (4) Perform other functions as specified by the Governor (section 
701).
    (b) Applicable Programs. For the purposes of this section, the 
programs included are those listed at section 701(b)(2) of the Act. A 
program shall be included only if the Governor and the head of the State 
agency responsible for the administration of the program jointly agree 
to include such program. In addition, programs under the Carl Perkins 
Vocational and Applied Technology Act shall require the agreement of the 
State council on vocational education (section 701(b)(1)(B)).
    (c) Composition. (1) The Governor shall establish procedures to 
ensure appropriate representation on the HRIC from among the categories 
of representation specified in section 702 of the Act.
    (2) In addition, when the functions and responsibilities of the 
SCOVE are included on the HRIC, the Governor is encouraged to consider 
appointing the State Director for Vocational Education as a 
representative on the HRIC.
    (d) Funding. (1) Funding to carry out the functions of the HRIC 
shall be available pursuant to section 703(a) of the Act.
    (i) The costs associated with the operation of the HRIC should be 
allocated among the various funding sources based on the relationship of 
each funding source or program to total spending of all applicable 
funding sources and programs (section 703(d)).
    (ii) Costs of the HRIC that are in excess of costs paid by funds 
from participating State agencies are, subject to the availability of 
funds from applicable JTPA sources, allowable JTPA costs (section 703(a) 
and (d)).
    (2) A HRIC which meets the requirements of title VII and includes 
each of the programs listed at section 701(b)(2)(A) of the Act shall be 
authorized to use JTPA State Education Coordination and Grants funds 
(section 123(a)(2)(D)(ii)).
    (e) Replacement of other councils. A HRIC meeting the requirements 
of title VII of the Act shall replace the councils of the participating 
programs listed at section 701(b)(2)(A) of the Act.
    (f) Expertise. The Governor shall ensure that in the composition of 
the HRIC and the staff of the HRIC there exists the proper expertise to 
carry out the functions of the HRIC and the council(s) it replaces 
(sections 702(c)(2) and 703(b)).
    (g) Certification. Each State, as part of the certification process 
to the Secretary, shall ensure that the council meets the requirements 
of sections 701, 702, and 703. This certification shall be made in 
writing and submitted to the Secretary, with a copy provided to the 
Secretary of Education, at least 90 days before the beginning of each 
period of 2 program years for which a job training plan is submitted 
under the Act.



                        Subpart C_State Programs



Sec.  628.300  Scope and purpose.

    This subpart provides requirements for the State-operated programs 
including the education coordination and grants, services to older 
workers, and

[[Page 236]]

incentive grants to SDA's and grants to SDA's for capacity building and 
technical assistance.



Sec.  628.305  State distribution of funds.

    (a) The funds made available to the Governor under sections 202(c) 
and 262(c) of the Act shall be used to carry out activities and services 
under this subpart.



Sec.  628.310  Administration.

    Funds provided to the Governor under sections 202(c)(1)(A) and 
262(c)(1)(A) of the Act may be used for overall administration, 
management, oversight of program performance; technical assistance to 
SDA's failing to meet performance standards, as described in section 
106(j)(1) of the Act; auditing; and activities under sections 121 and 
122 of the Act.



Sec.  628.315  Education coordination and grants.

    (a) Governor's responsibilities. The Governor shall allocate funds 
available pursuant to sections 202(c)(1)(C) and 262(c)(1)(C) of the Act 
to any State education agency. For the purposes of this section, ``State 
education agency'' shall not include the State agency which administers 
the JTPA program within the State or other agencies which do not have 
education as a primary and operational function, such as correctional 
agencies, although this limitation shall not preclude such an agency 
from being an ultimate subrecipient of funds (section 123(a)(1)).
    (b) Agreements. (1) The State education agency to be allocated funds 
under section 123(a)(1) of the Act shall participate in joint planning 
activities with the Governor in order to develop a plan which shall be 
submitted in the GCSSP (section 123(c)).
    (2) The Governor and the State education agency shall jointly agree 
on the plan required in paragraph (b)(1) of this section, which shall 
include a description of the agreements described in paragraph (b)(3) of 
this section (section 123(c)).
    (3) Projects to undertake the activities set forth in section 
123(a)(2) shall be conducted in accordance with agreements between the 
State education agency(ies) and administrative entities in service 
delivery areas in the State. The agreements may include other entities 
such as State agencies, local education agencies and alternative service 
providers (section 123(b)(1)(B)).
    (4)(i) When there is a failure by the State education agency and the 
Governor to develop the joint plan described in paragraph (b)(2) of this 
section, the Governor shall not allocate funds under section 123(a)(1) 
to such education agency nor shall such funds be available for 
expenditure by the Governor (section 123(c)).
    (ii) When no State education agency accepts the allocation of funds 
under section 123(a)(1), or when there is a failure to reach the 
agreement(s) specified in paragraph (b)(3) of this section, the funds 
may only be used by the Governor pursuant to section 123(e) and in 
accordance with the GCSSP (section 123(e)).
    (c) Allowable activities. (1) Funds made available for education 
coordination and grants under section 123 of the Act shall be used to 
pay the Federal share of education coordination and grants projects 
(section 123(a)(2)).
    (2) Projects, as defined at section 123(a)(2)(A), (B), and (C) of 
the Act shall be conducted for eligible individuals and should include 
those which:
    (i) Provide school-to-work services of demonstrated effectiveness, 
including youth apprenticeship programs;
    (ii) Provide literacy and lifelong learning opportunities and 
services of demonstrated effectiveness, including basic education and 
occupational skills training; and
    (iii) Provide statewide coordinated approaches to education and 
training services, including model programs, designed to train, place, 
and retain women in nontraditional employment (section 123(a)).
    (3) Projects for coordination of education and training may also be 
conducted which may include support activities pertaining to the HRIC 
which meets the requirements of title VII.
    (d) Expenditure requirements. (1)(i) At least 80 percent of the 
funds allocated under section 202(c)(1)(C) and section 262(c)(1)(C) of 
the Act shall be expended to pay for the Federal share of projects 
described in paragraph (c)(2) of this section (section 123(d)(2)(B)).

[[Page 237]]

    (ii) The Governor shall assure that not less than 75 percent of the 
funds expended for such projects are expended for projects for eligible 
economically disadvantaged participants who experience barriers to 
employment. For purposes of meeting this requirement, participants 
meeting the conditions of section 263(a)(2)(B) and (C) and (g) of the 
Act may be considered economically disadvantaged (section 123(d)(2)(C)).
    (iii) Priority for funds not expended for the economically 
disadvantaged shall be given to title III participants and persons with 
barriers to employment.
    (iv) The Governor may assure compliance with the requirement to 
serve participants with barriers to employment by targeting projects to 
particular barrier groups (e.g., school dropouts).
    (2) Not more than 20 percent of funds allocated under section 
202(c)(1)(C) of the Act may be expended to:
    (i) Facilitate coordination of education and training services for 
participants in the projects described in section 123(a)(2)(A), (B) and 
(C), or
    (ii)(A) Support activities pertaining to a HRIC that meets the 
requirements ofSec. 628.215 of this part, or
    (B) Support activities pertaining to a State council which carries 
out functions similar to those of a HRIC if such council was established 
prior to July 1, 1992.
    (e) Contribution. (1) Except as provided in paragraph (e)(3) of this 
section, the State shall provide for the contribution of funds, other 
than the funds made available under this Act, of a total amount equal to 
the amounts allotted under Section 123;
    (2) The Governor shall define and assure the provision of adequate 
resources by the State to meet the requirements of paragraph (e)(1) of 
this section. Such amount may include the direct cost of employment and 
training services provided by other Federal programs or agencies if such 
use for matching is in accordance with the applicable Federal law 
governing the use of such funds.
    (3) When there is a failure to reach agreement between the State 
education agency and the administrative entity in the service delivery 
area, as set forth in paragraph (b)(3) of this section, the requirement 
for the contribution of funds shall not apply.
    (f) Eligible youth, age 14 through 15, may be served in the program 
under this section to the extent set forth in the agreements under 
paragraph (b)(3) of this section.



Sec.  628.320  Services for older individuals.

    (a) Consultation. (1) The Governor shall consult with the 
appropriate PIC's and chief elected official(s) prior to entering into 
agreements to provide services under section 204(d) and to assure that 
services provided to participants under section 204(d) are consistent 
with the programs and activities provided in the SDA to eligible older 
participants.
    (2) The GCSSP shall specify the process for accomplishing the 
consultation required by paragraph (a)(2) of this section.
    (b) Funds available under section 204(d) shall be used by the 
Governor to provide services on an equitable basis throughout the State, 
taking into account the relative share of the population of eligible 
older individuals residing in each SDA and the participation of such 
older individuals in the labor force.
    (c) Delivery of services. (1) Services to participants eligible 
under section 204(d) shall be delivered through agreements with SDA's, 
private industry councils, public agencies, private nonprofit 
organizations (including veterans organizations) and private-for-profit 
organizations.
    (2) Priority for delivery of services under this section shall be 
given to agencies and organizations which have a demonstrated 
effectiveness in providing training and employment services to such 
older individuals.
    (d) Eligibility. (1) Individuals provided services under section 
204(d) of the Act shall be economically disadvantaged, based on criteria 
applicable in the SDA in which they reside, and shall be age 55 or 
older. However, each program year not more than 10 percent of 
participants enrolled under section 204(d)

[[Page 238]]

may be individuals who are not economically disadvantaged but have 
serious barriers to employment as identified by the Governor and have 
been determined within the last 12 months to meet the income eligibility 
requirements for title V of the Older Americans Act of 1965 (section 
204(d)(5)(B)(i)).
    (2) The following criteria shall apply to joint programs for older 
workers.
    (i) In order to carry out a joint program with operators of programs 
under title V of the Older Americans Act, there shall be a written 
financial or non-financial agreement, or written joint program 
description when the entity which operates the JTPA and title V program 
are the same.
    (ii) Joint programs under this paragraph (d)(2) may include 
referrals between programs, co-enrollment and provision of services.
    (iii) Under agreements pursuant to this paragraph (d)(2), 
individuals eligible under title V of the Older Americans Act shall be 
deemed to satisfy the requirements of section 203(a)(2) of the Act 
(Older Americans Act, Pub. L. 103-171, section 510).
    (e) Applicable requirements. Except as provided in the Act, the 
provisions of title II-A shall apply to programs conducted under section 
204(d) (section 204(d)(6)).
    (f) The Governor shall make efforts to coordinate the delivery of 
services under section 204(d) with the delivery of services under title 
V of the Older Americans Act of 1965. Such coordination may include 
coenrollment, coordination of a continuum of services between this 
section and title V of the Older Americans Act and other appropriate 
linkages.
    (g) The Governor shall give consideration to assisting programs 
involving training for jobs in growth industries and jobs reflecting the 
use of new technological skills (section 204(d)(3)).



Sec.  628.325  Incentive grants, capacity building, and technical
assistance.

    (a) Funds available to the Governor under sections 202(c)(1)(B) and 
262(c)(1)(B) of the Act shall be used to provide incentive grants to 
SDA's and for capacity building and technical assistance.
    (b) Incentive grants. (1) Not less than 67 percent of the funds 
available under sections 202(c)(1)(B) and 262(c)(1)(B) of the Act shall 
be used by the Governor to provide incentive grants for programs, except 
programs under section 204(d) of the Act, exceeding title II performance 
standards (section 106(b)(7)).
    (2) Incentive grant funds under this section shall be distributed by 
the Governor among SDA's within the State pursuant to section 106(b)(7) 
of the Act.
    (3) The Governor shall, as part of the annual statement of goals and 
objectives required by section 121(a)(1) of the Act, provide SDA's with 
the specific policies and procedures to implement section 106(b)(7) of 
the Act.
    (4) In a State which is the service delivery area, incentive grant 
funds shall be distributed in a manner determined by the Governor and 
described in the GCSSP. The Governor shall give consideration to 
recognizing the performance of service providers within the State.
    (5) SDA's should use incentive grant funds for capacity building and 
technical assistance activities and/or for the conduct of allowable 
Title II activities for eligible youth, eligible adults, or both, at the 
discretion of the SDA.
    (c) Capacity building and technical assistance. (1) Up to 33 percent 
of the funds available under sections 202(c)(1)(B) and 262(c)(1)(B) of 
the Act may be used by the Governor to provide capacity building and 
technical assistance efforts aimed at improving the competencies of the 
personnel who staff and administer JTPA including SDA's, service 
providers, State staff, private industry councils, other job training 
councils and related human service systems provided for in section 
205(a) of the Act.
    (2) In providing capacity building and technical assistance 
activities, the Governor shall:
    (i) Consult with SDA's concerning capacity building and technical 
assistance activities consistent with the process specified in the 
GCSSP;
    (ii) Ensure that the use of funds will assist front line staff 
providing services to participants by directing resources to SDA and 
service provider staff for capacity building efforts, building a 
statewide capacity building strategy

[[Page 239]]

based on an assessment of local capacity building needs developed in 
cooperation with the SDA's, and/or delivering training and technical 
assistance directly to the local level;
    (iii) Ensure that expenditures for the purchase of hardware/software 
are only for the development of Statewide communications and training 
mechanisms involving computer-based communication technologies that 
directly facilitate interaction with the National Capacity Building and 
Information Dissemination Network (National Network) described in 
section 453 of the Act and that facilitate the use of computer-based 
training techniques in capacity building and technical assistance 
activities;
    (iv) Ensure that State and local capacity building efforts are 
coordinated and integrated with the National Network, pursuant to 
sections 202(c)(3)(B) and 262(c)(3)(B) of the Act, and that materials 
developed with funds under this section are made available to be shared 
with other States, SDA's and the National Network. States and SDA's 
retain the flexibility to tailor Network products to their own needs 
and/or to produce and train on similar or related products when local 
circumstances so dictate and;
    (v) Provide technical assistance to service delivery areas failing 
to meet performance standards pursuant to section 106(j)(2) of the Act.
    (d) Cost sharing. (1) Cost sharing approaches are encouraged among 
States, SDA's and/or among other Federal, State, and local human service 
programs, including those listed in section 205(a) of the Act, in 
developing electronic communications, training mechanisms and/or 
contributing to the National Network.
    (2) All shared costs shall be allocated among the contributing 
funding sources on the basis of benefits received.



                 Subpart D_Local Service Delivery System



Sec.  628.400  Scope and purpose.

    This subpart sets forth requirements for the selection of service 
delivery areas, the establishment and responsibilities of the private 
industry council, and the selection of the SDA grant recipient and 
administrative entity. This subpart also contains the requirements for 
the local job training plan as well as the procedures for its review and 
approval by the State.



Sec.  628.405  Service delivery areas.

    (a)(1) The Governor, after receiving recommendations from the SJTCC, 
shall designate SDA's within the State in accordance with the provisions 
of section 101 of the Act.
    (2) SDA's may not be designated by the Governor more frequently than 
once every two years, and such designations shall be made to coincide 
with the two-year plan cycle for the GCSSP and local job training plans 
(i.e., the designation cannot be made for an off-year in this cycle).
    (3) Each request for designation as an SDA shall be submitted in a 
form and by a date established by the Governor. The procedures 
established by the Governor shall provide for the treatment of existing 
SDA's for the purposes of submitting SDA designation requests.
    (b)(1) The Governor shall approve SDA designation requests from 
entities with a population of 200,000 or more that satisfy the criteria 
specified in section 101(a)(4)(A) of the Act.
    (2) When there are competing applications under paragraph (b)(1) of 
this section for the same geographic area, the Governor shall designate 
the entity with the population closest to 200,000, if the remaining 
reduced area also continues to satisfy the criteria specified in section 
101(a)(4)(A) of the Act. The Governor shall offer to designate the 
remaining reduced area as an SDA as well.
    (3) When there are competing applications under paragraph (b)(1) of 
this section for the same geographic area and the designation of the 
entity with the population closest to 200,000 would have the effect of 
reducing the population of the competing entity to below a population of 
200,000, the Governor has the discretion to determine which request to 
honor.
    (d) The Governor may, in accordance with section 101(a)(4)(B) of the 
Act, approve a request to be a SDA from any unit, or contiguous units, 
of general local government, without regard to

[[Page 240]]

population, which serves a substantial portion of a labor market area. 
In making such designations, the Governor shall evaluate the degree to 
which a proposed service delivery area meets criteria established by the 
Governor which, at a minimum, shall include:
    (1) The capability to effectively deliver job training services;
    (2) The capacity to administer the job training program in 
accordance with the Act, applicable rules and regulations and State 
standards; and
    (3) The portion of a labor market to be served.
    (e) For the purposes of SDA designations under section 101(a)(4)(A) 
and (B) of the Act, the term ``substantial part'' and ``substantial 
portion'' of a labor market area shall be defined by the Governor, but 
shall not be less than 10% of the population of a labor market area.
    (f) All areas within the State shall be covered by designated SDA's. 
After honoring all requests for designation from eligible entities under 
section 101(a)(4)(A) of the Act, and making any qualified discretionary 
designations under section 101(a)(4)(B) of the Act, the Governor shall 
include uncovered areas in the State within other designated SDA's 
willing to accept them or within a State administered SDA.
    (g) Appeals. (1) Only an entity which meets the requirements of 
section 101(a)(4)(A) of the Act for designation as a service delivery 
area, but which has had its request to be an SDA denied, may appeal the 
Governor's denial of service delivery area designation to the Secretary 
of Labor.
    (2) Appeals made pursuant to paragraph (g)(1) of this section shall 
be submitted by certified mail, return receipt requested, to the 
Secretary, U.S. Department of Labor, Washington, DC 20210, Attention: 
ASET. A copy of the appeal shall simultaneously be provided to the 
Governor.
    (3) The Secretary shall not accept an appeal dated later than 30 
days after receipt of written notification of the denial from the 
Governor.
    (4) The appealing party shall explain why it believes the denial is 
contrary to the provisions of section 101 of the Act.
    (5) The Secretary shall accept the appeal and make a decision only 
with regard to whether or not the denial is inconsistent with section 
101 of the Act. The Secretary may consider any comments submitted by the 
Governor. The Secretary shall make a final decision within 30 days after 
receipt of the appeal (section 101(a)(4)(C)).
    (6) The Secretary shall notify the Governor and the appellant in 
writing of the Secretary's decision.



Sec.  628.410  Private Industry Council.

    (a) Certification of the PIC. (1) The chief elected official(s) of 
the SDA shall establish and the Governor shall certify the private 
industry council (PIC) pursuant to section 102 of the Act.
    (2) The Governor shall review the certification of the PIC 
biennially, one year prior to the effective date of the 2-year SDA job 
training plan to the Governor. The Governor's review shall include:
    (i) The PIC composition, which shall be consistent with section 
102(a), (b), (c), and (d) of the Act and shall include the names of 
individuals nominated and their qualifications;
    (ii) The nomination process;
    (iii) The written agreement(s) among the appropriate chief elected 
official(s) and the PIC, including procedures for the development of the 
SDA job training plan and the selection of the grant recipient and 
administrative entity.
    (3) The chief elected official shall select labor representatives 
for the PIC from individuals recommended by recognized State and local 
labor federations. For purposes of this section, a labor federation is 
an alliance of two or more organized labor unions for the purpose of 
mutual support and action. An example of a recognized labor federation 
is the AFL-CIO.
    (b) Responsibilities of the PIC. Pursuant to section 103 of the Act, 
the PIC shall:
    (1) Provide policy and program guidance for all activities under the 
job training plan for the SDA;
    (2) In accordance with agreements negotiated with the appropriate 
chief

[[Page 241]]

elected official(s), determine the procedures for development of the job 
training plan and select the grant recipient and administrative entity 
for the SDA;
    (3) Independent oversight. As specified in subpart D of part 627 of 
this chapter, the PIC shall exercise independent oversight over programs 
and activities under the job training plan, which oversight shall not be 
circumscribed by agreements with the appropriate chief elected 
official(s) of the SDA;
    (4) Be a party to the designation of substate grantees under title 
III, as set forth inSec. 631.35 of this chapter;
    (5) Establish guidelines for the level of skills to be provided in 
occupational skills training programs funded by the administrative 
entity;
    (6) Consult with the Governor on agreements to provide services for 
older individuals under section 204(d) of the Act;
    (7) Establish youth and adult competency levels consistent with 
performance standards established by the Secretary, based on such 
factors as entry level skills and other hiring requirements, in 
consultation with educational agencies and, where appropriate, with 
representatives of business, organized labor and community-based 
organizations pursuant to section 106(b)(5) and 107(d); and
    (8) Identify occupations for which there is a demand in the area 
served.
    (c) Substate plan. The PIC shall be provided the opportunity to 
review and comment on a substate grantee plan under title III of the Act 
prior to the submission of such plan to the Governor (section 313(a)).
    (d) [Reserved]
    (e) The State Employment Service agency shall develop jointly with 
each appropriate PIC and chief elected official(s) for the SDA those 
components of the plans required under the Wagner-Peyser Act which are 
applicable to the SDA. (See part 652 of this chapter).
    (f) Single SDA States. (1) In any case in which the service delivery 
area is a State, the SJTCC or a portion of the SJTCC may be 
reconstituted as a PIC if the PIC meets the requirements of section 
102(a) of the Act.
    (2) When the service delivery area is a State and the functions of 
the SJTCC are embodied in the HRIC, the HRIC or a portion of the HRIC 
may be reconstituted as a PIC if the requirements for private sector 
business representation at section 102(a)(1) of the Act are met (section 
102(h)).



Sec.  628.415  Selection of SDA grant recipient and administrative entity.

    (a) Selection of SDA grant recipient. (1) The SDA grant recipient 
and the entity to administer the SDA's job training plan for title II, 
developed pursuant to section 104 of the Act, shall be selected by 
agreement of the PIC and chief elected official(s) of the SDA. These may 
be the same or different entities.
    (2) The specific functions and responsibilities of the entities 
described in paragraph (a)(1) of this section shall be spelled out in 
the agreement between the PIC and the chief elected official(s), and 
shall specifically address the provisions of section 141(i) of the Act 
(section 103(b)(1)).
    (b) Subrecipient requirements. (1) The Governor may establish 
requirements pertaining to subrecipient, including SDA grant recipient, 
responsibility for JTPA funds.
    (2) The requirements of paragraph (b)(1) of this section shall not 
preclude the selection of any entity identified in section 103(b) of the 
Act as SDA grant recipient.



Sec.  628.420  Job training plan.

    (a) The Governor shall issue instructions and schedules to assure 
that job training plans and plan modifications for SDA's within the 
State conform to all requirements of the Act.
    (b) The Governor's instructions for development of the SDA's job 
training plan shall require that the plan contain the following 
information:
    (1) A complete and detailed discussion of the elements found in 
section 104(b) of the Act, including goals for the training and training 
related placement of women in nontraditional employment and 
apprenticeships;
    (2) A discussion of the SDA's compliance with the Secretary's 
program goals, as outlined in the planning guidance provided to the 
Governor; and
    (3) An oversight plan for the SDA which includes: (i) A description 
of the oversight activities of the PIC and the chief elected 
official(s), and (ii) the

[[Page 242]]

SDA administrative entity's monitoring plan which includes the 
Governor's monitoring requirements for service providers.
    (c) The Governor may also require that the SDA job training plan 
contain a capacity building and technical assistance strategy that 
includes plans for designating capacity building as a staff function, 
assessing local capacity building needs, and developing and 
participating in computerized communication mechanisms.
    (d) The SDA job training plan shall be jointly approved and jointly 
submitted to the Governor by the PIC and the chief elected official(s) 
(section 103(d)).
    (e) Modifications. (1) Any major modification to the SDA job 
training plan shall be jointly approved and jointly submitted by the PIC 
and chief elected official(s) of the SDA to the Governor for approval.
    (2) For the purposes of this section, the circumstances which 
constitute a ``major'' modification shall be specified by the Governor.



Sec.  628.425  Review and approval.

    (a) Standards and procedures. The Governor shall establish standards 
and procedures for the review and approval or disapproval of the SDA job 
training plan and plan modifications that shall be provided to the SDA's 
at the same time as the instructions and schedules for preparation of 
the plans are provided.
    (b) Plan approval. Except when the Governor makes a finding under 
the provisions of section 105(b)(1) of the Act, the Governor shall 
approve the SDA job training plan or plan modification. The notice of 
approval shall be provided in writing to the chief elected official(s) 
and to the private industry council.



Sec.  628.426  Disapproval or revocation of the plan.

    (a) If the Governor disapproves the SDA job training plan or plan 
modification for any reason, the Governor shall notify the PIC and chief 
elected official(s) for the SDA in writing as provided in section 
105(b)(2) of the Act.
    (b) If the Governor disapproves the SDA job training plan or plan 
modification, the Governor shall provide the PIC and the chief elected 
official(s) for the SDA 30 days to correct the deficiencies and resubmit 
the plan or plan modification. Within 15 days after the plan or plan 
modification is resubmitted, the Governor shall make a final decision 
and shall notify the PIC and the appropriate chief elected official(s) 
of the SDA in writing of the final disapproval or approval.
    (c) Governor mediation. If the PIC and the appropriate chief elected 
official(s) of an SDA are unable to reach an agreement under the 
provisions of section 103 (b)(1) or (d) of the Act, any such party may 
request the Governor to mediate.
    (d) Failure to reach agreement. If the PIC and the chief elected 
official(s) fail to reach the required agreements in section 103 (b)(1) 
or (d) of the Act, funds may not be made available to an SDA under 
section 104 of the Act and the Governor shall merge the affected area 
into one or more other existing service delivery areas (section 
105(c)(1)).
    (e) Appeals. (1) In accordance with section 105(b)(2) of the Act, 
any final disapproval by the Governor of the SDA job training plan or 
modification may be appealed by the PIC and chief elected official(s) of 
the SDA to the Secretary.
    (2) The Secretary shall not accept an appeal dated later than 30 
days after receipt by the PIC and chief elected official(s) of the final 
disapproval of the SDA job training plan or modification from the 
Governor.
    (3) The Secretary shall accept an appeal under paragraph (e)(1) of 
this section and shall determine only whether the disapproval is clearly 
erroneous under section 105(b)(1) of the Act. The Secretary may consider 
any comments submitted by the Governor. In accordance with section 
105(b)(2) of the Act, the Secretary shall make a final decision within 
45 days after the appeal is received by the Secretary.
    (4) The Secretary shall notify the Governor and the appellant in 
writing of the Secretary's decision.
    (f) Appeals of plan revocations. Pursuant to section 164(b)(1) of 
the Act, a notice of intent to revoke approval of all or part of a plan 
may be appealed to the Secretary. Such appeals shall be

[[Page 243]]

treated as a disapproval under paragraphs (c) and (e) of this section, 
except that the revocation shall not become effective until the later 
of:
    (1) The time for appeal under paragraph (e) of this section has 
expired; or
    (2) The date on which the Secretary issues a decision affirming the 
revocation.
    (g) In the event that a plan is disapproved and the Governor's 
decision is upheld upon appeal, the Governor shall merge the affected 
area into other designated SDA's willing to accept it or include it in 
another SDA within the State.



Sec.  628.430  State SDA Submission.

    (a) Pursuant to section 105(d) of the Act, when the SDA is the 
State, the Governor shall submit to the Secretary, not less that 60 days 
before the beginning of the first of the two program years covered by 
the job training plan and in accordance with instructions issued by the 
Secretary, an SDA job training plan covering two program years. When the 
SDA is the State, modifications to the plan shall be submitted to the 
Secretary for approval.
    (b) When a State submits an SDA job training plan or plan 
modification pursuant to paragraph (a) of this section, the Secretary 
shall review the plan or plan modification for overall compliance with 
the provisions of the Act. The State's plan shall be considered approved 
unless, within 45 days of receipt of the submission described in 
paragraph (a) of this section, the Secretary notifies the Governor in 
writing of inconsistencies between the submission and requirements of 
specific provisions of the Act. If the plan or plan modification is 
disapproved, the Governor may appeal the decision by requesting a 
hearing before an administrative law judge pursuant to subpart H of part 
627 of this chapter.



Subpart E_Program Design Requirements for Programs Under Title II of the 
                      Job Training Partnership Act



Sec.  628.500  Scope and purpose.

    This subpart contains the regulations pertaining to the program 
design requirements common to all programs conducted under titles I 
(i.e., sections 121 and 123) and II of the Act. Regulations specifically 
pertaining to the Adult Program can be found in subpart F of this part. 
Regulations pertaining to the Summer Youth Employment and Training 
Program can be found in subpart G of this part. Regulations pertaining 
to the Youth Training Program can be found in subpart H of this part.



Sec.  628.505  Eligibility.

    (a) Eligibility criteria. (1) Individuals who apply to participate 
in a program under title II shall be evaluated for eligibility based on 
age and economic disadvantage. Specific eligibility criteria for 
programs under title II, parts A, B, and C are described in this part.
    (2) Individuals served under title II shall be residents of the SDA, 
as determined by local government policy, except for the limited 
exceptions described in the job training plan, including joint programs 
operated by SDA's (section 141(e)).
    (b) Eligibility documentation. (1) In order to promote the uniform 
and standard application of eligibility criteria for participation in 
the JTPA program, the Department has issued an Eligibility Documentation 
TAG that provides guidance on acceptable documentation.
    (2) SDA utilization of eligibility guidance. When it is determined 
that the SDA or service provider has followed the guidance contained in 
the Eligibility Documentation TAG, the Grant Officer will not disallow 
questioned costs related to the required documentation concerning an 
individual's eligibility.



Sec.  628.510  Intake, referrals and targeting.

    (a) Collection of personal data. In addition to determining an 
applicant's eligibility, the intake process shall include a preliminary 
review of information relating to whether an applicant is included in 
one or more of the categories listed in section 203(b) of the Act.
    (b) Information on services. Upon application, an eligible 
individual shall be provided information by the SDA or its service 
providers on the full array

[[Page 244]]

of services available through the SDA and its service providers, 
including information for women about the opportunities for 
nontraditional training and employment.
    (c) Assessment during intake. Some limited assessment activities may 
be conducted during the intake process in order to determine an eligible 
applicant's suitability for title II program services. This assessment 
should be a method, in difficult cases, to finalize determinations for 
enrollment. The amount of assessment provided during intake is not 
restricted, however, assessment during intake shall be charged in 
accordance withSec. 627.440(d)(3).
    (d) Referral of eligible applicants. During the intake process, 
determinations may be made prior to enrollment to refer an eligible 
applicant to another human service, training or education program deemed 
more suitable for the individual, including the Job Corps program. In 
these cases, information on the full array of services available in the 
SDA may be provided in written form with recommendations and written 
referrals to other appropriate programs. Copies of or notations of 
referrals will be maintained as documentation and may be recorded in an 
incomplete ISS. Further tracking or follow-up of referrals out of title 
II is not required.
    (e) Referrals from service providers to service delivery areas for 
additional assessment. (1) Each service provider shall ensure that an 
eligible applicant who cannot be served by its particular program shall 
be referred to the SDA for assessment, as necessary, and suitable 
referral to other appropriate programs. Each service provider shall also 
ensure that a participant who cannot be served by its particular program 
shall be referred to the SDA for further assessment, as necessary, and 
suitable referral to other appropriate programs, consistent withSec. 
628.515.
    (2) Each SDA shall take the appropriate steps (e.g., contract 
provisions, local administrative issuances, and/or PIC policies) to 
ensure that its service providers adhere to the provisions of this 
section and that they maintain documentation of referrals.
    (3) Each SDA shall develop an appropriate mechanism to ensure 
suitability screening for eligible applicants or to apply the provisions 
ofSec. 628.530 for participants referred by service providers and 
describe such mechanism in its SDA job training plan.
    (f)(1) ``Most in need.'' SDA's that satisfy the requirements of 
sections 203(b) and 263 (b) and (d) pertaining to hard to serve 
individuals shall be deemed to meet the ``most in need'' criteria at 
section 141(a) of the Act.
    (2) The requirements referred to in paragraph (h)(1) of this section 
shall be calculated on the basis of new participants for whom services 
or training have been provided subsequent to the objective assessment.
    (g) The SDA's method of meeting the requirements of sections 203(b) 
and 263(b) pertaining to hard to serve individuals shall be implemented 
consistent with the equal opportunity provisions of 29 CFR part 34.



Sec.  628.515  Objective assessment.

    (a) General. The requirements of this section shall apply to 
programs conducted under title I (i.e., sections 121 and 123) and title 
II, parts A, B, and C.
    (b) Definition. (1) For purposes of this part, an objective 
assessment means an examination of the capabilities, needs, and 
vocational potential of a participant and is to be used to develop an 
individual service strategy and employment goal. Such assessment is 
customer-centered and a diagnostic evaluation of a participant's 
employment barriers taking into account the participant's family 
situation, work history, education, basic and occupational skills, 
interests, aptitudes (including interests and aptitudes for 
nontraditional occupations), attitude towards work, motivation, behavior 
patterns affecting employment potential, financial resources and needs, 
supportive service needs, and personal employment information as it 
relates to the local labor market.
    (2) For the program under title II-B, the objective assessment shall 
include an examination of the basic skills and supportive service needs 
of each participant and may include the other areas listed in paragraph 
(b)(1) of this section

[[Page 245]]

(sections 204(a)(1)(A), 253(c)(1) and 264(b)(1)(A)).
    (c) Methods of objective assessment. (1) The SDA shall choose the 
most appropriate means to measure skills, abilities, attitudes, and 
interests of the participants. The methods used in conducting the 
objective assessment may include, but are not limited to, structured 
interviews, paper and pencil tests, performance tests (e.g., skills, 
and/or work samples, including those that measure interest and 
capability to train in nontraditional employment), behavioral 
observations, interest and/or attitude inventories, career guidance 
instruments, aptitude tests, and basic skills tests.
    (2) Instruments used for objective assessment may be developed at 
the local level; however, any formalized instruments nationally 
available should be used only for the specific populations for which 
they are normed.
    (d) Updating of assessments. Objective assessment should be treated 
as an ongoing process. As additional relevant information relating to a 
participant becomes available, it should be reviewed and considered for 
inclusion in the individual service strategy.
    (e) Other sources of objective assessment. Other non-JTPA 
assessments (e.g., through the Job Opportunities and Basic Skills (JOBS) 
program under title IV of the Social Security Act, or through schools) 
which have been completed within one year of application for services, 
and which meet the requirements of this section, may be used to comply 
with the requirement to assess each participant.



Sec.  628.520  Individual service strategy.

    (a) General. The requirements of this section shall apply to 
programs conducted under title I (i.e., sections 121 and 123) and title 
II, parts A, B and C.
    (b) Definition. (1) Individual service strategy (ISS) means an 
individual plan for a participant, which shall include an employment 
goal (including, for women, consideration of nontraditional employment), 
appropriate achievement objectives, and the appropriate combination of 
services for the participant based on the objective assessment conducted 
pursuant toSec. 628.515 of this part, Objective assessment. In 
developing the ISS, the participant shall be counseled regarding 
required loan repayments if the participant chooses to incur personal 
indebtedness to participate in an education program. The participant 
shall also be apprised of the requirements for self-sufficiency and the 
occupational demands within the labor market.
    (2) Decisions concerning appropriate services shall be customer-
centered, and ensure that the participant is not excluded from training 
or career options consistent with the provisions of 29 CFR part 34 
concerning nondiscrimination and equal opportunity.
    (3) For the title II-B program, the ISS may include the components 
specified in paragraph (b)(1) of this section (sections 204(a)(1)(B), 
253(c)(2) and 264(b)(1)(B)). For purposes of titles II-B and II-C, the 
employment goal may be interpreted broadly and based on long-term career 
guidance.
    (c) Joint Development of ISS. The ISS shall be developed in 
partnership with the participant and reflect the needs indicated by the 
objective assessment and the expressed interests and desires of the 
participant. It is not a formal contract and signatures are not a 
requirement.
    (d) Review of ISS. The ISS shall be reviewed periodically to 
evaluate the progress of each participant in meeting the objectives of 
the service strategy, including an evaluation of the participant's 
progress in acquiring basic skills, and occupational skills, as 
appropriate, and the adequacy of the supportive services provided.
    (e) Provision of services. If JTPA resources are not sufficient to 
provide the full range of training or supportive services which might be 
identified in the ISS, the SDA shall make every reasonable effort to 
arrange for, through other community resources, basic and occupational 
skills training and supportive services identified as needed in the ISS 
for participants under titles II-A and II-C and, in addition, 
preemployment and work maturity skills training and work experience 
combined with skills training for participants under title II-C 
(sections 204(a)(1)(D) and 264(b)(1)(D).
    (f) SDA review of objective assessment and ISS. (1) The objective 
assessment

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and development of the ISS may be conducted by service providers.
    (2) The SDA administrative entity shall ensure that development of 
the ISS and the services provided, respond to the individual needs of 
the participant and that the combination of services to the participant 
is indicated by the results of the objective assessment.
    (g) ISS record of decisions. The ISS shall be used as the basic 
instrument for the SDA to record the results of decisions made about the 
combination and sequence of services for the participant based on the 
objective assessment. Justification for decisions may be referenced but 
need not be recorded in the ISS. These decisions shall include, but are 
not limited to, the employment goal and/or career cluster; referrals to 
other programs for specified activities; the provision and amount of 
supportive services; and the delivery agents and schedules for training 
and supportive services activities. The decisions for time and duration 
of OJT (Sec.  627.240 of this chapter) shall be briefly recorded in the 
ISS and may not reference other documents.
    (h) The ISS is a customer-centered case management tool and shall 
not be used as a compliance document.



Sec.  628.525  Limitations.

    Neither eligibility for nor participation in a JTPA program creates 
an entitlement to services, and nothing in the Act or this part shall be 
construed to establish a private right of action for a participant to 
obtain services described in the objective assessment or ISS.



Sec.  628.530  Referrals of participants to non-title II programs.

    (a) When it is determined, through the objective assessment and the 
ISS, that a participant would be better served by a program other than 
one under title II (e.g., Job Corps, Vocational Rehabilitation, State or 
local education, substance abuse treatment center, and/or dislocated 
worker programs), the participant shall be referred to the appropriate 
program. Such referral shall be recorded in the ISS.
    (b) In cases where there will be a continuing relationship with a 
participant, a referral to another program(s) for specific services will 
be part of the participant's title II program strategy and will be 
recorded in the ISS.
    (c) When there will not be a continuing relationship with a 
participant as the result of a referral to a program other than title 
II, and an assessment but no training component has been provided, the 
referral should be recorded in a partial ISS and the individual shall 
not be counted for purposes of calculating performance against the SDA's 
performance standards. Further tracking or follow-up of referrals out of 
title II is not required.



Sec.  628.535  Limitations on job search assistance.

    (a) General. Job search assistance is designed to give a participant 
skills in acquiring full time employment. (SeeSec. 626.5 of this 
chapter, Definitions.)
    (b) Conditions. Job search activities may be conducted only:
    (1) For participants when specified as appropriate in the ISS; and
    (2) When delivered in conjunction with other training or educational 
services designed to increase the participant's ability to acquire 
employment. Additional services which may be provided in conjunction 
with job search include the direct training services listed in JTPA 
section 204(b)(1) of the Act, excluding standalone skill assessment, 
counseling, work experience and case management and the direct training 
services listed in 264(b) of the Act excluding tutoring, standalone 
skill assessment, counseling, work experience and case management. (See 
Sec.  627.245 of this chapter, ``Work Experience,'' especiallySec. 
627.245(d) regarding combination of other services.)
    (c) Exceptions. (1) Job search assistance activities, including job 
search skills, training, and job clubs may be provided without the 
accompanying services specified in paragraph (b) of this section only 
when:
    (i) The objective assessment and the ISS indicate that the 
additional services are not appropriate; and
    (ii) The activities are not available or accessible through other 
public agencies, including the Employment Service.

[[Page 247]]

    (2) The exceptions in paragraph (c)(1) of this section apply to 
Title II-A and II-B and are not applicable to Title II-C programs (see 
Sec.  628.804 (d) and (e)).
    (d) Determination of job search availability. For purposes of this 
section, a determination of the availability of the job search 
assistance activity will be made by the SDA, in consultation with the 
employment service and documented in the local job training plan.
    (e) Older individuals. For purposes of this section, when an 
individual aged 55 or older indicates in the assessment a preference for 
immediate job placement, job search assistance may be provided on a 
stand-alone basis. The individual's preference shall be recorded in the 
ISS.



Sec.  628.540  Volunteer program.

    Pursuant to sections 204(c)(6) and 264(d)(7) of the Act, the SDA 
shall make opportunities available for individuals who have successfully 
participated in programs under this part to volunteer assistance, in the 
form of mentoring, tutoring, and other activities.



Sec.  628.545  Linkages and coordination.

    (a) General requirements. (1) To the extent practicable, and as 
permitted by law and regulations, the Governor shall, at the State 
level, facilitate coordination among the programs set forth at section 
205(a) and 265(b) of the Act, including, but not limited to, the 
establishment of State-level coordination agreements. The Governor may 
focus coordination through the SJTCC or the HRIC.
    (2) The SDA, in conducting programs under this part, shall establish 
appropriate linkages and coordination procedures with other Federal 
programs and appropriate State and local educational, social service, 
and public housing agencies, including with CBO's, business and labor 
organizations, volunteer groups and others, such as women and older 
worker organizations, and with appropriate education and training 
agencies, such as local JOBS programs, Employment Service offices which 
provide services for JTPA participants, and the local agencies on aging, 
to avoid duplication and to enhance the delivery of services, which 
shall be described in the SDA job training plan. Where a local agency 
declines to complete such a linkage with an SDA, the SDA shall reflect 
this information in its job training plan (section 104(b)).
    (b) SDA's are encouraged to facilitate effective ``one stop shop 
career centers'' and ``single point of contact'' delivery systems which 
may include:
    (1) The development of individual service strategy plans and of a 
common program application; and
    (2) A unified job development effort and comprehensive programmatic 
design (sections 104(b) (3) and (4), 205 (a) and (b) and 265).
    (c) Requirements for youth. For the youth programs under this part, 
formal agreements shall be established with appropriate local 
educational agencies which participate in JTPA programs which, at a 
minimum, shall specify:
    (1) The procedures for referring and serving in-school youth;
    (2) The methods of assessment of in-school youth; and
    (3) Procedures for notifying the SDA when a youth drops out of the 
school system.
    (d) Schoolwide projects. (1) In conducting a schoolwide project for 
low income individuals under sections 263(g) and 265(d) of the Act, the 
SDA shall establish a cooperative agreement with the appropriate local 
educational agency.
    (2) In addition to the requirements listed in paragraphs (a) and (b) 
of this section, the cooperative agreement shall include:
    (i) A description of the ways in which the JTPA schoolwide project 
will supplement the educational program of the school;
    (ii) Identification of measurable goals to be achieved by the 
schoolwide project and a provision for assessing the extent to which 
such goals are met;
    (iii) A description of the ways in which the program will use 
available JTPA and other education program resources;
    (iv) A description of the number of individuals to be served by the 
schoolwide project; and

[[Page 248]]

    (v) Assurances that JTPA resources shall be used in coordination 
with existing sources of funds to supplement and not supplant them 
(section 107(b)).
    (3) In areas where there is more than one local educational agency, 
cooperative agreements for schoolwide projects are required only with 
those local education agencies that will participate in programs under 
schoolwide projects (section 263(g)).



Sec.  628.550  Transfer of funds.

    If described in the job training plan and approved by the Governor:
    (a) An amount up to 10 percent of the funds allocated to the SDA 
under section 202(b) of the Act for title II-A may be transferred to the 
program under title II-C of the Act;
    (b) An amount up to 20 percent of the funds allocated to the SDA 
under section 252(b) of the Act for title II-B may be transferred to the 
program under title II-C of the Act; and
    (c) An amount up to 10 percent of the funds allocated to the SDA 
under section 262(b) of the Act for title II-C may be transferred to the 
program under title II-A of the Act.



                       Subpart F_The Adult Program



Sec.  628.600  Scope and purpose.

    This subpart contains the regulations for the Adult Program under 
part A of Title II of the Act. The regulations in part 627 of this 
chapter and subpart E of this part apply to the Adult Program to the 
extent that they do not conflict with the provisions of this subpart.



Sec.  628.605  Eligibility.

    (a) Age and economic disadvantage. Except as provided in paragraph 
(b) of this section, an individual shall be eligible to participate 
under this part only if he or she is economically disadvantaged and 22 
years of age or older. There is no maximum age for eligibility.
    (b) Non-economically disadvantaged individuals. Up to 10 percent of 
the individuals served under this subpart in each SDA may be individuals 
who are not economically disadvantaged, if such individuals face serious 
barriers to employment in accordance with section 203(c) of the Act.
    (c) Requirement to assist hard-to-serve individuals. (1) Not less 
than 65 percent of adults who participate in the program under this 
subpart, including those who are not economically disadvantaged, shall 
have one or more of the additional barriers to employment as described 
in section 203(b) of the Act.
    (2) The 65 percent barrier requirement in paragraph (c)(1) of this 
section shall be calculated on the basis of participants for whom 
services or training have been provided subsequent to an objective 
assessment on July 1, 1993 or later.
    (d) Addition of barrier. An SDA may identify and add one additional 
serious barrier to employment to the categories listed at section 203(b) 
of the Act, in accordance with the specific procedures and requirements 
in section 203(d) of the Act.
    (e) Criteria for older workers under joint programs. (1) The SDA may 
establish written financial or non-financial agreements with sponsors of 
programs under title V of the Older Americans Act to carry out joint 
programs.
    (2) Joint programs under this paragraph (e) may include referrals 
between programs, co-enrollment and provision of services.
    (3) Under agreements entered into pursuant to this paragraph (e), 
individuals eligible under title V of the Older Americans Act shall be 
deemed to satisfy the requirements of section 203(a)(2) of the JTPA 
(Older Americans Act, Pub. L. 102-375, section 510).



Sec.  628.610  Authorized services.

    (a) The services that may be provided under this subpart are those 
described at section 204(b) of the Act.
    (b) Counseling and supportive services. Counseling and supportive 
services provided under this subpart may be provided to a participant 
for a period of up to 1 year after the date on which the participant 
completes the program.

[[Page 249]]



       Subpart G_The Summer Youth Employment and Training Program



Sec.  628.700  Scope and purpose.

    This subpart contains the regulations for the Summer Youth 
Employment and Training Program (SYETP) under part B of title II of the 
Act. The regulations in part 627 of this chapter and subpart E of this 
part apply to the SYETP to the extent that they do not conflict with the 
provisions of this subpart.



Sec.  628.701  Program goals and objectives.

    (a) Each SDA shall establish written goals and objectives that shall 
be used in evaluating the effectiveness of its SYETP activities. Such 
goals and objectives may include enhancement of basic educational skills 
through improvement in school retention or academic performance 
(including mathematics and reading comprehension); encouragement of 
school completion or enrollment in supplementary or alternative school 
programs; improvement of employability skills, including provision of 
vocational exploration opportunities and exposure to the world of work; 
enhancement of youth citizenship skills; and demonstrated coordination 
with other appropriate community organizations.
    (b) Each SDA shall ensure that the activities and services offered 
under the SYETP are consistent with and will contribute to the 
achievement of the goals and objectives developed pursuant to paragraph 
(a) of this section.



Sec.  628.702  Eligibility.

    (a) Age and economic disadvantage. An individual is eligible to 
participate in programs funded under title II-B of the Act, if such 
individual is
    (1) Age 14 through 21; and
    (2)(i) Economically disadvantaged; or
    (ii) Has been determined to meet the eligibility requirements for 
free meals under the National School Lunch Act during the most recent 
school year. Most recent school year means the current school year 
unless the eligibility determination is made during an interim period 
between school terms, in which case the term means the preceding school 
year; or
    (iii) Is participating in a compensatory education program under 
Chapter I of title I of the Elementary and Secondary Education Act of 
1965; or
    (iv) Is participating in a schoolwide project as set forth at 
section 263(g) of the Act.
    (b) Eligibility determination verification. The SDA may accept the 
same documentation utilized by the local educational agency for 
approving free lunch meals or an assurance by school officials 
concerning the students' participation in the free school lunch program 
under the National School Lunch Act.



Sec.  628.705  SYETP authorized services.

    (a) The services that may be provided under this subpart are those 
described at section 253 of the Act.
    (b) Basic and remedial education and preemployment and work maturity 
skills training. The SDA shall ensure the availability of basic or 
remedial education and preemployment and work maturity skills training 
for SYETP participants pursuant to the assessment process described in 
Sec.  628.515 of this part from funds available to the SDA or by other 
education and training programs, including, but not limited to, the Job 
Corps, the JOBS program, youth corps programs or alternative or 
secondary schools.
    (c) Work experience. (1) Work experience shall be conducted 
consistent with the provisions ofSec. 627.245 of this chapter.
    (2) Work experience provided under this subpart, to the extent 
feasible, shall include contextual learning opportunities which 
integrate the development of general competencies with the development 
of academic skills.
    (d) Concurrent enrollment. (1) Youth being served under the SYETP or 
the Youth Training Program authorized under title II-C of the Act (see 
subpart H of this part) are not required to be terminated from 
participation in one program to enroll in the other. The SDA may enroll 
such youth concurrently in programs under this subpart and subpart H of 
this part, pursuant to guidance to be issued by the Secretary,

[[Page 250]]

in order to promote continuity and coordination of services.
    (2) The requirement that not less than 65 percent of the total 
number of title II-C participants shall have one or more barriers to 
employment pursuant to section 263(c) and (d) of the Act shall apply to 
youth who are concurrently enrolled and will participate in the program 
under title II-C.
    (e) Followup services. (1) The SDA shall make followup services 
available for participants if the ISS indicates that such services are 
appropriate (section 253(d)).
    (2) Title II-B funds may be used for such followup services for one 
year after program participation, which may be concurrent with a period 
of any subsequent participation in the Title II-C program.
    (3) Followup services include the full array of supportive services 
described in section 4(24) of the Act, except for financial assistance, 
and may include such followup services as counseling, mentoring, or 
tutoring.
    (f) Classroom training. Classroom training provided under this 
subpart shall, to the extent feasible, include opportunities to apply 
knowledge and skills relating to academic subjects to the world of work.
    (g) Educational linkages. (1) In conducting the program assisted 
under this subpart, service delivery areas shall establish linkages with 
the appropriate educational agencies responsible for service to 
participants.
    (2) Such linkages shall include arrangements to ensure that there is 
a regular exchange of information relating to the progress, problems and 
needs of participants, including the results of assessments of the skill 
levels of participants.



Sec.  628.710  Period of program operation.

    (a) Except as provided under paragraph (b) of this section, the 
SYETP shall be conducted during the school vacation period occurring 
duri the summer months.
    (b) An SDA operating within the jurisdiction of one or more local 
educational agencies that operate schools on a year-round full-time 
basis may offer SYETP activities to participants in such a jurisdiction 
during the school vacation period(s) treated as the period(s) equivalent 
to a school summer vacation.



                    Subpart H_Youth Training Program



Sec.  628.800  Scope and purpose.

    This subpart contains the regulations for the Year-round Youth 
Program under part C of title II of the Act. The regulations in part 627 
of this chapter and subpart E of this part apply to the Year-round Youth 
program to the extent that they do not conflict with the provisions of 
this subpart.



Sec.  628.803  Eligibility.

    (a) Out-of-school youth. An out of school youth is a youth who does 
not meet the definition of in-school youth as set forth in paragraph (b) 
of this section. An out-of-school youth shall be eligible to participate 
in programs under this subpart, if such individual is:
    (1) Age 16 through 21, and
    (2) Economically disadvantaged.
    (b) In-school youth. Definition. In-school youth means a youth who 
has not yet attained a high school diploma and is attending school full 
time. An in-school youth shall be eligible to participate in programs 
under this subpart, if such individual is:
    (1)(i) Age 16 through 21, or
    (ii) If provided in the job training plan, age 14 through 21 
inclusive; and
    (2)(i) Economically disadvantaged; or
    (ii) Participating in a compensatory education program under Chapter 
I of title I of the Elementary and Secondary Education Act of 1965; or
    (iii) Has been determined to meet the eligibility requirements for 
free meals under the National School Lunch Act during the most recent 
school year. Most recent school year means the current school year 
unless the eligibility determination is made during an interim period 
between school terms, in which case the term means the preceding school 
year.
    (c) Eligibility determination verification. The SDA may accept the 
same documentation utilized by the local educational agency for 
approving free lunch meals or an assurance by

[[Page 251]]

school officials concerning the students' participation in the free 
school lunch program under the National School Lunch Act. The Department 
shall provide guidance on this verification separate from these 
regulations.
    (d) Requirement to serve hard-to-serve individuals. (1) Not less 
than 65 percent of the in-school youth who participate in the program 
under this subpart, including those who are not economically 
disadvantaged, shall have one or more additional barriers to employment, 
as described in section 263(b) of the Act.
    (2)(i) Not less than 65 percent of the out-of-school youth who 
participate in the program under this subpart, including those who are 
not economically disadvantaged, shall have one or more barriers to 
employment, as described in section 263(d) of the Act, in addition to 
any criterion listed in paragraph (b)(2) of this section.
    (ii) All Job Corps participants shall be considered out-of-school 
and as having a barrier to employment.
    (3) The requirement of paragraphs (d)(1) and (2) of this section 
shall be calculated on the basis of participants for whom services or 
training have been provided subsequent to the objective assessment on 
July 1, 1993 or later.
    (e) Addition of barrier. An SDA may identify and add one additional 
serious barrier to employment to the categories listed at sections 
263(b) and (d) of the Act in accordance with the specific procedures and 
requirements in section 263(h) of the Act.
    (f) Services to non-economically disadvantaged individuals. Up to 10 
percent of the youth served by an SDA under this subpart may be 
individuals who are not economically disadvantaged, but such individuals 
shall face one or more serious barriers to employment in accordance with 
section 263(e) of the Act.
    (g) Eligibility based on schoolwide project participation. (1) In 
addition to the individuals who meet the conditions described inSec. 
628.803 of this part, individuals who are not economically disadvantaged 
may participate in programs under this subpart if they are enrolled in a 
schoolwide project pursuant to section 263(g) of the Act.
    (2) For purposes of paragraph (g)(1) of this section, the term 
school means an individual building, facility, campus or a portion of 
the school such as the 11th or 12th grade.
    (3) A schoolwide project may be operated in a public school located 
in an urban census tract or non-metropolitan county with a poverty rate 
of 30 percent or above, and in which 70 percent or more of the students 
have at least one barrier to employment. The school shall make the 
determination on whether its students meet the barrier requirements.
    (4) The SDA shall determine which will be its schoolwide projects. 
Examples of schoolwide projects include, but are not limited to, school-
to-work programs; college awareness and application assistance programs; 
school restructuring to make the schools career academies or magnet 
schools; mentoring programs; business-education compacts; integration of 
work and learning; year-round extensions of summer STEP programs; 
community service programs, including linkages with youth service corps; 
programs to encourage teen parents to stay in school, including 
establishing child care centers; and work experience slots provided as 
incentives to stay in school.
    (h)(1) Out-of-school ratio. Not less than 50 percent of the total 
title II-C participants in each SDA shall be out-of-school youth 
(section 263(f)(1) of the Act). The Governor shall be responsible for 
determining the period for which the 50 percent requirement will be 
calculated based either on the period covered by the job training plan 
or on a program year basis.
    (2) For purposes of paragraph (h)(1) of this section, a youth who 
has attained a high school diploma or an equivalency, is habitually 
truant, as defined by State law, or is attending an alternative school 
program may be considered out of school. An alternative school program 
includes an alternative high school, an alternative course of study 
approved by the local educational agency, or a high school equivalency 
program. Such programs may be operated either within or outside of the 
local public school system,

[[Page 252]]

and can offer either a high school diploma or equivalency.
    (3) Schoolwide project ratios. Those in-school participants who are 
served under a schoolwide project shall not be counted in determining 
the ratio of in-school to out-of-school youth in paragraph (h)(1) of 
this section.



Sec.  628.804  Authorized services.

    (a) The SDA and the PIC shall take into consideration exemplary 
program strategies and services, including those selected for 
replication pursuant to section 453(c) of the Act concerning capacity 
building, in the development of services for programs under this 
subpart.
    (b) Except as provided in paragraph (c) of this section, in order to 
participate in programs under this part an individual who is under the 
age of 18 and a school dropout, as defined in section 4(38) of the Act, 
shall enroll in and attend a school, course or program described in 
section 264(d)(2)(B)(ii) and (iii). An alternative course of study shall 
be approved by the LEA and may include educational programs provided by 
community-based organizations.
    (c) An individual who is a school dropout, as defined in section 
4(38) of the Act, and under the age of 18 may participate in programs 
under this part without meeting the requirements of paragraph (b) of 
this section for a limited interim period which may be during the summer 
months, during periods between school terms, or when a course of study 
is not immediately available.
    (d) The provision of preemployment and work maturity skills training 
shall be accompanied either by work experience or by other additional 
services which are designed to increase the basic education or 
occupational skills of the participant (section 264(d)(3)(A)).
    (e) The provision of work experience, job search assistance, job 
search skills training, and job club activities under programs conducted 
under this subpart shall be accompanied by other additional services 
which are designed to increase the basic education or occupational 
skills of the participant (section 264(d)(3)(B)).
    (f) The additional services offered pursuant to paragraphs (d) and 
(e) of this section may be provided concurrently or sequentially with 
services provided under other education and training programs (e.g., Job 
Opportunities and Basic Skills programs under title IV of the Social 
Security Act, Job Corps (see part 638 of this chapter), or schools).
    (g) Schoolwide projects for low-income schools shall meet the 
conditions in sections 263(g)(1) and (2) of the Act.
    (h) Entry employment experience is a training activity which may be 
conducted in public or private agencies. In all cases, this training 
activity shall increase or develop the long term employability of 
eligible in-school and out-of-school youth. Entry employment experiences 
may include, but are not limited to:
    (1) Work experience as described inSec. 627.245 of this chapter; 
and
    (2) Cooperative education programs that coordinate educational 
programs with work in the private sector. Subsidized wages are not 
permitted in cooperative education programs.
    (i) Limited internships in the private sector under this subpart 
shall be designed to enhance the long-term employability of youth.
    (1) A limited internship shall be conducted pursuant to an agreement 
with an employer to provide structured on-site private sector exposure 
to work and the requirements for successful job retention.
    (2) A limited internship should be combined with classroom 
instruction relating to a particular position, occupation, industry or 
the basic skills and abilities to successfully compete in the local 
labor market.
    (j)(1) On-the-job (OJT) training activities approved under this 
subpart shall be consistent with the provisions of subpart B of part 627 
of this chapter and shall:
    (i) Be for positions that pay the participant a wage that equals or 
exceeds on the average wage at placement based on the most recent 
available data in the SDA for participants under title II-A;
    (ii) Be for positions that have career advancement potential; and
    (iii) Include a formal, written program of structured job training 
that will provide the participant with an orderly combination of 
instruction in

[[Page 253]]

work maturity skills, general employment competencies, and occupational 
specific skills.
    (2) In those cases where the OJT participant is a school dropout, 
the participant shall participate in an education program in accordance 
with paragraph (b) of this section.
    (k) Counseling and supportive services provided under this subpart 
may be provided to a participant for a period of up to 1 year after the 
date on which the participant completes the program. These include the 
full array of supportive services described in section 4(24) of the Act 
except for financial assistance.
    (l) Year-round operations. Programs for youth under this subpart 
shall:
    (1) Provide for a year-round education and training program that is 
coordinated with the appropriate local educational agencies, service 
providers, and other programs; and
    (2) As appropriate, ensure services for youth are available on a 
multiyear basis, consistent with the determined needs and goals of the 
youth served.
    (3) The year-round program delivery requirement of this paragraph 
does not prohibit schools on a 9-month operations schedule from 
providing services for programs under this part.

                        PARTS 629	630 [RESERVED]



PART 631_PROGRAMS UNDER TITLE III OF THE JOB TRAINING PARTNERSHIP
ACT--Table of Contents



                      Subpart A_General Provisions

Sec.
631.1 Scope and purpose.
631.2 Definitions.
631.3 Participant eligibility.
631.4 Approved training rule.

 Subpart B_Additional Title III Administrative Standards and Procedures

631.11 Allotment and obligation of funds by the Secretary.
631.12 Reallotment of funds by the Secretary.
631.13 Classification of costs at State and substate levels.
631.14 Limitations on certain costs.
631.15 Federal reporting requirements.
631.16 Complaints, investigations, and penalties.
631.17 Federal monitoring and oversight.
631.18 Federal by-pass authority.
631.19 Appeals.

                    Subpart C_Needs-Related Payments

631.20 Needs-related payments.

                     Subpart D_State Administration

631.30 Designation or creation and functions of a State dislocated 
          worker unit or office and rapid response assistance.
631.31 Monitoring and oversight.
631.32 Allocation of funds by the Governor.
631.33 State procedures for identifying funds subject to mandatory 
          Federal reallotment.
631.34 Designation of substate areas.
631.35 Designation of substate grantees.
631.36 Biennial State plan.
631.37 Coordination activities.
631.38 State by-pass authority.

                        Subpart E_State Programs

631.40 State program operational plan.
631.41 Allowable State activities.

                       Subpart F_Substate Programs

631.50 Substate plan.
631.51 Allowable substate program activities.
631.52 Selection of service providers.
631.53 Certificate of continuing eligibility.

    Subpart G_Federal Delivery of Dislocated Worker Services Through 
                      National Reserve Account Fund

631.60 General.
631.61 Application for funding and selection criteria.
631.62 Cost limitations.
631.63 Reporting.
631.64 General administrative requirements.
631.65 Special provisions for CAETA and DDP.

Subpart H [Reserved]

             Subpart I_Disaster Relief Employment Assistance

631.80 Scope and purpose.
631.81 Availability of funds.
631.82 Substate allocation.
631.83 Coordination.
631.84 Allowable projects.
631.85 Participant eligibility.
631.86 Limitations on disaster relief employment.
631.87 Definitions.

    Authority: 29 U.S.C. 1579(a); Sec. 6305(f), Pub. L. 100-418, 102 
Stat 1107;Sec. 631.30(d)(7) also issued under 29 U.S.C. 2107(a);Sec. 
631.37(e)

[[Page 254]]

also issued under Sec. 402, Pub. L. 100-689, 102 Stat. 4178-4179 (29 
U.S.C. 1751 note).

    Source: 59 FR 45857, Sept. 2, 1994, unless otherwise noted.



                      Subpart A_General Provisions



Sec.  631.1  Scope and purpose.

    This part implements Title III of the Act. Title III programs seek 
to establish an early readjustment capacity for workers and firms in 
each State; to provide comprehensive coverage to workers regardless of 
the cause of dislocation; to provide early referral from the 
unemployment insurance system to adjustment services as an integral part 
of the adjustment process; to foster labor, management and community 
partnerships with government in addressing worker dislocation; to 
emphasize retraining and reemployment services rather than income 
support; to create an on-going substate capacity to deliver adjustment 
services; to tailor services to meet the needs of individuals; to 
improve accountability by establishing a system of mandated performance 
standards; to improve financial management by monitoring expenditures 
and reallotting available funds; and to provide the flexibility to 
target funds to the most critical dislocation problems.



Sec.  631.2  Definitions.

    In addition to the definitions contained in sections 4, 301, and 
303(e) of the Act and Part 626 of this chapter, the following 
definitions apply to programs under Title III of the Act and this part:
    Substantial layoff (for participant eligibility) means any 
reduction-in-force which is not the result of a plant closing and which 
results in an employment loss at a single site of employment during any 
30 day period for:
    (a)(1) At least 33 percent of the employees (excluding employees 
regularly working less than 20 hours per week); and
    (2) At least 50 employees (excluding employees regularly working 
less than 20 hours per week); or
    (b) At least 500 employees (excluding employees regularly working 
less than 20 hours per week).
    Substantial layoff (for rapid response assistance) means any 
reduction-in-force which is not the result of a plant closing and which 
results in an employment loss at a single site of employment during any 
30 day period for at least 50 employees (excluding employees regularly 
working less than 20 hours per week) (section 314(b)(4)).



Sec.  631.3  Participant eligibility.

    (a) Eligible dislocated workers, as defined in section 301 of the 
Act, may participate in programs under this part. For the purposes of 
determining eligibility under section 301(a)(1)(A) of the Act, the term 
``eligible for'' unemployment compensation includes any individual whose 
wages from employment would be considered in determining eligibility for 
unemployment compensation under Federal or State unemployment 
compensation laws.
    (b)(1) Except as provided in paragraph (b)(3) of this section, 
workers who have not received an individual notice of termination but 
who are employed at a facility for which the employer has made a public 
announcement of planned closure shall be considered eligible dislocated 
workers with respect to the provision of basic readjustment services 
specifically identified in section 314(c) of the Act with the exception 
of supportive services and relocation assistance.
    (2) Individuals identified in paragraph (b)(1) of this section shall 
be eligible to receive all services authorized in sections 314 of the 
Act after a date which is 180 days prior to the scheduled closure date 
of the facility, subject to the provisions ofSec. 631.20 of this part 
and other applicable provisions regarding receipt of supportive 
services.
    (3) Paragraphs (b)(1) and (b)(2) of this section shall not apply to 
individuals who are likely to remain employed with the employer or to 
retire instead of seeking new employment.
    (4) For the purposes of paragraph (b)(1) of this section, the 
Governor shall establish criteria for defining public announcement. Such 
criteria shall include provisions that the public announcement shall be 
made by the employer and shall indicate a planned closure date for the 
facility (section 314(h)).

[[Page 255]]

    (c) Eligible dislocated workers include individuals who were self-
employed (including farmers and ranchers) and are unemployed:
    (1) Because of natural disasters, subject to the provisions of 
paragraph (e) of this section; or
    (2) As a result of general economic conditions in the community in 
which they reside.
    (d) For the purposes of paragraph (c) of this section, categories of 
economic conditions resulting in the dislocation of a self-employed 
individual may include, but are not limited to:
    (1) Failure of one or more businesses to which the self-employed 
individual supplied a substantial proportion of products or services;
    (2) Failure of one or more businesses from which the self-employed 
individual obtained a substantial proportion of products or services;
    (3) Substantial layoff(s) from, or permanent closure(s) of, one or 
more plants or facilities that support a significant portion of the 
State or local economy.
    (e) The Governor is authorized to establish procedures to determine 
the eligibility to participate in programs under this part of the 
following categories of individuals:
    (1) Self-employed farmers, ranchers, professionals, independent 
tradespeople and other business persons formerly self-employed but 
presently unemployed.
    (2) Self-employed individuals designated in paragraph (d)(1) of this 
section who are in the process of going out of business, if the Governor 
determines that the farm, ranch, or business operations are likely to 
terminate.
    (3) Family members and farm or ranch hands of individuals identified 
under paragraphs (d)(1) and (2) of this section, to the extent that 
their contribution to the farm, ranch, or business meets minimum 
requirements as established by the Governor.
    (f) The Governor is authorized to establish procedures to identify 
individuals permanently dislocated from their occupations or fields of 
work, including self-employment, because of natural disasters. For the 
purposes of this paragraph (f), categories of natural disasters include, 
but are not limited to, any hurricane, tornado, storm, flood, high 
water, wind-driven water, tidal wave, tsunami, earthquake, volcanic 
eruption, landslide, mudslide, drought, fire, or explosion.
    (g) The State may provide services to displaced homemakers (as 
defined in section 4 of the Act) under this part only if the Governor 
determines that such services may be provided without adversely 
affecting the delivery of such services to eligible dislocated workers 
(section 311(b)(4)).
    (h) An eligible dislocated worker issued a certificate of continuing 
eligibility, as provided inSec. 631.53 of this part, shall remain 
eligible for assistance under this part for the period specified in the 
certificate, not to exceed 104 weeks. The 45-day enrollment provisions 
described in subpart B of part 627 of this chapter shall be waived for 
eligible individuals who possess a valid certificate under this 
paragraph and it is not required that a new application be taken prior 
to participation.
    (i) An eligible dislocated worker who does not possess a valid 
certificate shall remain eligible if such individual:
    (1) Remains unemployed, or
    (2) Accepts temporary employment for the purpose of income 
maintenance prior to and/or during participation in a training program 
under this part with the intention of ending such temporary employment 
at the completion of the training and entry into permanent unsubsidized 
employment as a result of the training. Such temporary employment must 
be with an employer other than that from which the individual was 
dislocated. This provision applies to eligible individuals both prior to 
and subsequent to enrollment.
    (j) The Governor shall ensure that rapid response and basic 
readjustment services under Title III of JTPA are made available to 
workers who, under the NAFTA Worker Security Act (Pub. L. 103-182), are 
members of a group of workers (including workers in any agricultural 
firm or subdivision of an agricultural firm) for which the Governor has 
made a finding that (1) the sales or production, or both, of such firm 
or subdivision have decreased absolutely, and (2) imports from Mexico or 
Canada of articles like or directly competitive with articles produced 
by such firm or

[[Page 256]]

subdivision have increased; or (3) there has been a shift in production 
by such workers' firm or subdivision to Mexico or Canada of articles 
which are produced by the firm or subdivision.



Sec.  631.4  Approved training rule.

    An eligible dislocated worker who is participating in any retraining 
activity, except on-the-job training, under Title III of the Act or this 
part shall be deemed to be in training with the approval of the State 
agency for purposes of section 3304(a)(8) of the Internal Revenue Code 
of 1986. Participation in the approved training shall not disqualify the 
individual from receipt of unemployment benefits to which the individual 
is otherwise entitled (section 314(f)(2)).



 Subpart B_Additional Title III Administrative Standards and Procedures



Sec.  631.11  Allotment and obligation of funds by the Secretary.

    (a) Funds shall be allotted among the various States in accordance 
with section 302(b)(1) of the Act, subject to paragraph (b) of this 
section.
    (b) Funds shall be allotted among the various States in accordance 
with section 302(b)(2)(A) and (B) of the Act as soon as satisfactory 
data are available under section 462(e) of the Act.
    (c) Allotments for the Commonwealth of the Northern Mariana Islands 
and other territories and possessions of the United States shall be made 
by the Secretary in accordance with the provisions of section 302(e) of 
the Act.



Sec.  631.12  Reallotment of funds by the Secretary.

    (a) Based upon reports submitted by States pursuant toSec. 631.15 
of this part, the Secretary shall make determinations regarding total 
expenditures of funds within the State with reference to the amount 
required to be reallotted pursuant to section 303(b) of the Act. For 
purposes of this paragraph (a)--
    (1) The funds to be reallotted will be an amount equal to the sum 
of:
    (i) Unexpended funds in excess of 20 percent of the prior program 
year's formula allotment to the State, and
    (ii) All unexpended funds from the formula allotment for the program 
year preceding the prior program year.
    (2)(i) The current program year is the year in which the 
determination is made; and
    (ii) The prior program year is the year immediately preceding the 
current program year.
    (3) Unexpended funds shall mean the remainder of the total funds 
made available by formula that were available to the State for the prior 
program year minus total accrued expenditures at the end of the prior 
program year.
    (4) Reallotted funds will be made available from current year 
allotments made available by formula.
    (b) Based upon the most current and satisfactory data available, the 
Secretary shall identify eligible States, pursuant to the definitions in 
section 303(e) of the Act.
    (c) The Secretary shall recapture funds from States identified in 
paragraph (a) of this section and reallot and reobligate such funds by a 
Notice of Obligation (NOO) adjustment to current year funds to eligible 
States as identified in paragraph (b) of this section, as set forth in 
section 303(a), (b), and (c) of the Act.
    (d) Reallotted funds shall be subject to allocation pursuant to 
Sec.  631.32 of this part, and to the cost limitations atSec. 631.14 
of this part.



Sec.  631.13  Classification of costs at State and substate levels.

    (a)(1) Allowable costs under Title III shall be planned, controlled, 
and charged by either the State or the substate grantee against the 
following cost categories: rapid response services, basic readjustment 
services, retraining services, needs-related payments and supportive 
services, and administration. Costs shall be reported to the Secretary 
of Labor in accordance with the reporting requirements established 
pursuant toSec. 631.15 of this part.
    (2) All costs shall be allocable to a particular cost category to 
the extent that benefits are received by such category; and no costs 
shall be chargeable to a cost category except to the extent that 
benefits are received by such category.

[[Page 257]]

    (b) Rapid response services shall include the cost of rapid response 
activities identified at section 314(b) of the Act.
    (1) Staff salary and benefit costs are chargeable to the rapid 
response services cost category only for that portion of staff time 
actually spent on rapid response activities.
    (2) All other costs are chargeable to the rapid response services 
cost category only to the extent that they are for rapid response 
purposes.
    (c) Basic readjustment services shall include the cost of basic 
readjustment services identified at section 314(c) of the Act, except 
that the cost of supportive services under section 314(c)(15) of the Act 
shall be charged to the needs-related payments and supportive services 
cost category, as provided in paragraph (e) of this section.
    (d) Retraining services shall include the cost of retraining 
services identified at section 314(d) of the Act.
    (e) Needs-related payments and supportive services shall include the 
cost of needs-related payments identified in section 314(e) of the Act, 
and supportive services identified in section 4(24) of the Act and 
provided for in section 314(c)(15) of the Act.
    (f)(1) Administration shall include the costs incurred by recipients 
and subrecipients in the administration of programs under Title III of 
the Act, and shall be that portion of necessary and allowable costs 
which is not directly related to the provision of services and otherwise 
allocable to the cost categories in paragraphs (b) through (e) of this 
section. The description of administrative costs in subpart D of part 
627 of this chapter shall be used by States and substate grantees as 
guidance in charging administration costs to Title III programs.
    (2) Administration does not include the costs of activities under 
section 314(b) of the Act and which are provided for in paragraph (b) of 
this section.
    (3) Administration shall include Title III funds used for 
coordination of worker adjustment programs with the Federal-State 
unemployment compensation system and with Chapter 2 of Title II of the 
Trade Act of 1974 (19 U.S.C. 2271, et seq.) and part 617 of this chapter 
(sections 311(b)(10) and 314(f)).



Sec.  631.14  Limitations on certain costs.

    (a) Retraining services. Of the funds allocated to a substate 
grantee under part A of Title III for any program year, not less than 50 
percent shall be expended for retraining services specified under 
section 314(d) of the Act, unless a waiver of this requirement is 
granted by the Governor. The Governor shall prescribe criteria that will 
allow substate grantees to apply in advance for a waiver of this 
requirement, pursuant to section 315(a)(2) of the Act. The Governor 
shall prescribe the time and form for the submission of an application 
for such a waiver, as provided for at section 315(a)(3) of the Act. The 
Governor shall not grant a waiver that allows less than 30 percent of 
the funds expended by a substate grantee to be expended for retraining 
activities.
    (b) Needs-related payments and supportive services. Of the funds 
allocated to the Governor, or allocated to any substate grantee, under 
part A of Title III for any program year, not more than 25 percent may 
be expended to provide needs-related payments and other supportive 
services.
    (c) Administrative cost. Of the funds allocated to the Governor, or 
allocated to any substate grantee, under part A of Title III for any 
program year, not more than 15 percent may be expended to cover the 
administrative cost of programs.
    (d) Reallotted funds are subject to the cost limitations in 
paragraphs (a), (b) and (c) of this section.
    (e) Funds allocated (or distributed) to substate areas under the 
provisions of section 302(c)(1)(E) of the Act shall be considered funds 
allocated to a substate grantee for the program year of the funds' 
initial allotment to the State, and included in the cost limitations in 
paragraphs (a), (b) and (c) of this section.
    (f) Funds reserved by the Governor under the provisions of Section 
302(c)(1) of the Act, other than funds distributed to substate grantees 
under the provisions of JTPA section 302(c)(1)(E), shall be considered 
funds allocated to the Governor for the program year of the funds' 
initial allotment to the State

[[Page 258]]

and included in the cost limitations applicable to the Governor.
    (g) States and substate grantees shall have the full period of time 
that the funds are available to them to comply with the cost limitations 
described in JTPA section 315 and paragraphs (a), (b), and (c) of this 
section.
    (h) Combination of funds. (1) Substate grantees within a State may 
combine funds allocated under part A of Title III for provision of 
services to eligible dislocated workers from two or more substate areas. 
Funds contributed by the substate grantees under this section remain 
subject to the cost limitations which apply to each substate grantee's 
total allocation (section 315(d)).
    (2) To combine funds under this provision, substate grantees must be 
in contiguous substate areas or part of the same labor market area.
    (i) For the purposes of this section:
    (1) Allotment to the State means allotted by the formula described 
in section 302(b) of the Act, as adjusted by reallotments among the 
States, in accordance with section 303 of the Act. For purposes of 
determining availability and of applying cost limitations, funds will 
retain the identity of the program year in which they were initially 
allotted to a State, irrespective of subsequent reallotments.
    (2) Allocated to the substate grantee means allocated by the formula 
prescribed by the Governor under section 302(b) of the Act, and 
allocated (or distributed) under the provisions of section 302(c)(1)(E), 
as adjusted by within State reallocations implemented by the Governor 
through procedures established pursuant to section 303(d) of the Act. 
For purposes of determining availability and of applying cost 
limitations, funds will retain the identity of the program year in which 
they were initially allotted to the State.
    (3) Allocated to the Governor refers to funds reserved by the 
Governor for use in accordance with the provisions of section 302(c)(1) 
of the Act, exclusive of any such funds which are distributed or 
allocated to substate grantees pursuant to section 302(c)(1)(E).
    (j) The cost limitations described in this section do not apply to 
any designated substate grantee which served as a concentrated 
employment program grantee for a rural area under the Comprehensive 
Employment and Training Act (section 108(d)).



Sec.  631.15  Federal reporting requirements.

    Notwithstanding the requirements in subpart D of part 627 of this 
chapter, the Governor shall report to the Secretary pursuant to 
instructions issued by the Secretary for programs and activities funded 
under this part. Such reports shall include a cost breakdown of all 
funds made available under this part used by the State Dislocated Worker 
Unit for administrative expenditures. Reports shall be provided to the 
Secretary within 45 calendar days after the end of the report period 
(sections 165(a)(2) and 311(b)(11)).



Sec.  631.16  Complaints, investigations, and penalties.

    The provisions of this section apply in addition to the sanctions 
provisions in subpart G of part 627 of this chapter.
    (a) The Secretary shall investigate a complaint or report received 
from an aggrieved party or a public official which alleges that a State 
is not complying with the provisions of the State plan required under 
section 311(a) of the Act (section 311(e)(1)).
    (b) Where the Secretary determines that a State has failed to comply 
with its State plan, and that other remedies under the Act and part 627 
of this chapter are not available or are not adequate to achieve 
compliance, the Secretary may withhold an amount not to exceed 10 
percent of the allotment to the State for the program year in which the 
determination is made for each such violation (section 311(e)(2)(A)).
    (c) The Secretary will not impose the penalty provided for under 
paragraph (b) of this section until all other remedies under the Act and 
part 627 of this chapter for achieving compliance have been exhausted or 
are determined to be unavailable or inadequate to achieve State 
compliance with the terms of the State plan.
    (d) The Secretary will make no determination under this section 
until the

[[Page 259]]

affected State has been afforded adequate written notice and an 
opportunity to request and to receive a hearing before an administrative 
law judge pursuant to the provisions of subpart H of part 627 of this 
chapter (section 311(e)(2)(B)).



Sec.  631.17  Federal monitoring and oversight.

    The Secretary shall conduct oversight of State administration of 
programs under this part, including the administration by each State of 
the rapid response assistance services provided in such State. The 
Secretary shall take the appropriate actions to ensure the 
effectiveness, efficiency and timeliness of services conducted by the 
State in accordance withSec. 631.30(b) of this part (section 
314(b)(3)).



Sec.  631.18  Federal by-pass authority.

    (a) In the event that a State fails to submit a biennial State plan 
that is approved underSec. 631.36 of this part, the Secretary shall 
make arrangements to use the amount that would be allotted to that State 
for the delivery in that State of the programs, activities, and services 
authorized under Title III of the Act and this part.
    (b) No determination may be made by the Secretary under this section 
until the affected State is afforded written notification of the 
Secretary's intent to exercise by-pass authority and an opportunity to 
request and to receive a hearing before an administrative law judge 
pursuant to the provisions of subpart H of part 627 of this chapter.
    (c) The Secretary will exercise by-pass authority only until such 
time as the affected State has an approved plan under the provisions of 
Sec.  631.36 of this part (section 321(b)).



Sec.  631.19  Appeals.

    Except as provided in this part, disputes arising in programs under 
this part shall be adjudicated under the appropriate State or local 
grievance procedures required by subpart E of part 627 of this chapter 
or other applicable law. Complaints alleging violations of the Act or 
this part may be filed with the Secretary, pursuant to subpart F of part 
627 of this chapter. Paragraphs (a) through (e) of this section refer to 
appeal rights set forth in this part.
    (a) Section 628.405(g) of this chapter (appeals of denial of SDA 
designation) shall apply to denial of substate area designations under 
Sec.  631.34(c)(1) and (3) of this part.
    (b) Section 628.426(e) of this chapter (appeals of final disapproval 
of SDA job training plans or modifications) shall apply to final 
disapproval of substate plans underSec. 631.50(f) of this part.
    (c) Section 628.426(f) of this chapter (appeals of a Governor's 
notice of intent to revoke approval of all or part of a plan) shall 
apply to a Governor's notice of intent to exercise by-pass authority 
underSec. 631.38 of this part.
    (d) Section 628.430(b) of this chapter (appeals of the Secretary's 
disapproval of a plan when the SDA is the State) shall apply to plan 
disapproval when the substate area is the State, as set forth inSec. 
631.50(g) and (h) of this part.
    (e) Decisions pertaining to designations of substate grantees under 
Sec.  631.35 of this part are not appealable to the Secretary.



                    Subpart C_Needs-related payments



Sec.  631.20  Needs-related payments.

    (a) Title III funds available to States and substate grantees may be 
used to provide needs-related payments to participants in accordance 
with the approved State or substate plan, as appropriate.
    (b) In accordance with the approved substate plan, needs-related 
payments shall be provided to an eligible dislocated worker only in 
order to enable such worker to participate in training or education 
programs under this part. To be eligible for needs-related payments:
    (1) An eligible worker who has ceased to qualify for unemployment 
compensation must have been enrolled in a training or education program 
by the end of the thirteenth week of the worker's initial unemployment 
compensation benefit period, or, if later, by the end of the eighth week 
after an employee is informed that a short-term layoff will in fact 
exceed 6 months.
    (2) For purposes of paragraph (b)(1) of this section, the term 
enrolled in a

[[Page 260]]

training or education program means that the worker's application for 
training has been approved and the training institution has furnished 
written notice that the worker has been accepted in the approved 
training program beginning within 30 calendar days.
    (3) An eligible worker who does not qualify for unemployment 
compensation must be participating in a training or education program 
(section 314(e)(1)).
    (c) Needs-related payments shall not be provided to any participant 
for the period that such individual is employed, enrolled in, or 
receiving on-the-job training, out-of-area job search, or basic 
readjustment services in programs under the Act, nor to any participant 
receiving trade readjustment allowances, on-the-job training, out-of-
area job search allowances, or relocation allowances under Chapter 2 of 
Title II of the Trade Act of 1974 (19 U.S.C. 2271, et seq.) or part 617 
of this chapter (section 314(e)(1)).
    (d) The level of needs-related payments to an eligible dislocated 
worker in programs under this part shall not exceed the higher of:
    (1) The applicable level of unemployment compensation; or
    (2) The poverty level (as by the published by the Secretary of 
Health and Human Services) (section 314(e)(2)).



                     Subpart D_State Administration



Sec.  631.30  Designation or creation and functions of a State 
dislocated worker unit or office, and rapid response assistance.

    (a) Designation or creation of State dislocated worker unit or 
office. The State shall designate or create an identifiable State 
dislocated worker unit or office with the capabilities and functions 
identified in paragraph (b) of this section. Such unit or office may be 
an existing organization or new organization formed for this purpose 
(section 311(b)(2)). The State dislocated worker unit or office shall:
    (1) Make appropriate retraining and basic adjustment services 
available to eligible dislocated workers through substate grantees, and 
in statewide, regional or industrywide projects;
    (2) Work with employers and labor organizations in promoting labor-
management cooperation to achieve the goals of this part;
    (3) Operate a monitoring, reporting, and management system to 
provide adequate information for effective program management, review, 
and evaluation;
    (4) Provide technical assistance and advice to substate grantees;
    (5) Exchange information and coordinate programs with the 
appropriate economic development agency, State education and training 
and social services programs;
    (6) Coordinate with the unemployment insurance system, the Federal-
State Employment Service system, the Trade Adjustment Assistance program 
and other programs under this chapter;
    (7) Receive advance notice of plant closings and mass layoffs as 
provided at section 3(a)(2) of the Worker Adjustment and Retraining 
Notification Act (29 U.S.C. 2102(a)(2) and part 639 of this chapter);
    (8) Immediately notify (within 48 hours) the appropriate substate 
grantees following receipt of an employer notice of layoff or plant 
closing or of any other information that indicates a projected layoff or 
plant closing by an employer in the grantee's substate area, in order to 
continue and expand the services initiated by the rapid response team 
(section 311(b)(3)(D));
    (9) Fully consult with labor organizations where substantial numbers 
of their members are to be served; and
    (10) Disseminate throughout the State information on the 
availability of services and activities under Title III of the Act and 
this part.
    (b) Rapid response capability. The dislocated worker unit shall have 
one or more rapid response specialists, and the capability to provide 
rapid response assistance, on-site, for dislocation events such as 
permanent closures and substantial layoffs throughout the State. The 
State shall not transfer the responsibility for the rapid response 
assistance functions of the State dislocated worker unit to another 
entity, but the State may contract with another entity to perform rapid 
response assistance services. Nothing in this paragraph shall remove or 
diminish the

[[Page 261]]

dislocated worker unit's accountability for ensuring the effective 
delivery of rapid response assistance services throughout the State 
(section 311(b)(12)).
    (1) State rapid response specialists should be knowledgeable about 
the resources available through programs under this part and all other 
appropriate resources available through public and private sources to 
assist dislocated workers. The expertise required by this part includes 
knowledge of the Federal, State, and local training and employment 
systems; labor-management relations and collective bargaining 
activities; private industry and labor market trends; programs and 
services available to veterans; and other fields necessary to carry out 
the rapid response requirements of the Act.
    (2) The rapid response specialists should have:
    (i) The ability to organize a broad-based response to a dislocation 
event, including the ability to coordinate services provided under this 
part with other State-administered programs available to assist 
dislocated workers, and the ability to involve the substate grantee and 
local service providers in the assistance effort;
    (ii) The authority to provide limited amounts of immediate financial 
assistance for rapid response activities, including, where appropriate, 
financial assistance to labor-management committees formed under 
paragraph (c)(2) of this section;
    (iii) Credibility among employers and in the employer community in 
order to effectively work with employers in difficult situations; and
    (iv) Credibility among employee groups and in the labor community, 
including organized labor, in order to effectively work with employees 
in difficult situations.
    (3) The dissemination of information on the State dislocated worker 
unit's services and activities should include efforts to ensure that 
major employers, organized labor, and groups of employees not 
represented by organized labor, are aware of the availability of rapid 
response assistance. The State dislocated worker unit should make equal 
effort in responding to dislocation events without regard to whether the 
affected workers are represented by a union.
    (4) In a situation involving an impending permanent closure or 
substantial layoff, a State may provide funds, where other public or 
private resources are not expeditiously available, for a preliminary 
assessment of the advisability of conducting a comprehensive study 
exploring the feasibility of having a company or group, including the 
workers, purchase the plant and continue it in operation.
    (5) Rapid response specialists may use funds available under this 
part:
    (i) To establish on-site contact with employer and employee 
representatives within a short period of time (preferably 48 hours or 
less) after becoming aware of a current or projected permanent closure 
or substantial layoff in order to--
    (A) Provide information on and facilitate access to available public 
programs and services; and
    (B) Provide emergency assistance adapted to the particular permanent 
closure or substantial layoff; such emergency assistance may include 
financial assistance for appropriate rapid response activities, such as 
arranging for the provision of early intervention services and other 
appropriate forms of immediate assistance in response to the dislocation 
event;
    (ii) To promote the formation of labor-management committees as 
provided for in paragraph (c) of this section, by providing:
    (A) Immediate assistance in the establishment of the labor-
management committee, including providing immediate financial assistance 
to cover the start-up costs of the committee;
    (B) A list of individuals from which the chairperson of the 
committee may be selected;
    (C) Technical advice as well as information on sources of 
assistance, and liaison with other public and private services and 
programs; and
    (D) Assistance in the selection of worker representatives in the 
event no union is present;
    (iii) To provide ongoing assistance to labor-management committees 
described in paragraph (c) of this section by:

[[Page 262]]

    (A) Maintaining ongoing contact with such committees, either 
directly or through the committee chairperson;
    (B) Attending meetings of such committees on an ex officio basis; 
and
    (C) Ensuring ongoing liaison between the committee and locally 
available resources for addressing the dislocation, including the 
establishment of linkages with the substate grantee or with the service 
provider designated by the substate grantee to act in such capacity;
    (iv) To collect information related to:
    (A) Economic dislocation (including potential closings or layoffs); 
and
    (B) All available resources within the State for serving displaced 
workers, which information shall be made available on a regular basis to 
the Governor and the State Council to assist in providing an adequate 
information base for effective program management, review, and 
evaluation;
    (v) To provide or obtain appropriate financial and technical advice 
and liaison with economic development agencies and other organizations 
to assist in efforts to avert worker dislocations;
    (vi) To disseminate information throughout the State on the 
availability of services and activities carried out by the dislocated 
worker unit or office; and
    (vii) To assist the local community in developing its own 
coordinated response and in obtaining access to State economic 
development assistance.
    (6) Notwithstanding the definition of ``substantial layoff (for 
rapid response assistance)'' atSec. 631.2 of this part;
    (i) The Governor shall provide rapid response and basic readjustment 
services to members of a group of workers under the NAFTA Worker 
Security Act for which the Governor has made a finding underSec. 
631.3(j); and
    (ii) The Governor may, under exceptional circumstances, authorize 
rapid response assistance provided by a State dislocated worker unit 
when the layoff is less than 50 or more individuals, is not at a single 
site of employment, or does not take place during a single 30 day 
period. For purposes of this provision, exceptional circumstances 
include those situations which would have a major impact upon the 
community(ies) in which they occur (section 314(b)).
    (c) Labor-management committees. As provided in sections 301(b)(1) 
and 314(b)(1)(B) of the Act, labor-management committees are a form of 
rapid response assistance which may be voluntarily established to 
respond to actual or prospective worker dislocation.
    (1) Labor management committees ordinarily include (but are not 
limited to) the following:
    (i) Shared and equal participation by workers and management, with 
members often selected in an informal fashion;
    (ii) Shared financial participation between the company and the 
State, using funds provided under Title III of the Act, in paying for 
the operating expenses of the committee; in some instances, labor union 
funds may help to pay committee expenses;
    (iii) A chairperson, to oversee and guide the activities of the 
committee who--
    (A) Shall be jointly selected by the labor and management members of 
the committee;
    (B) Is not employed by or under contract with labor or management at 
the site; and
    (C) Shall provide advice and leadership to the committee and prepare 
a report on its activities;
    (iv) The ability to respond flexibly to the needs of affected 
workers by devising and implementing a strategy for assessing the 
employment and training needs of each dislocated worker and for 
obtaining the services and assistance necessary to meet those needs;
    (v) A formal agreement, terminable at will by the workers or the 
company management, and terminable for cause by the Governor; and
    (vi) Local job identification activities by the chairperson and 
members of the committee on behalf of the affected workers.
    (2) Because they include employee representatives, labor-management 
committees typically provide a channel whereby the needs of eligible 
dislocated workers can be assessed, and programs of assistance developed 
and implemented, in an atmosphere supportive to each affected worker. As 
such, committees must be perceived to

[[Page 263]]

be representative and fair in order to be most effective.



Sec.  631.31  Monitoring and oversight.

    The Governor is responsible for monitoring and oversight of all 
State and substate grantee activities under this part. In such 
monitoring and oversight of substate grantees, the Governor shall ensure 
that expenditures and activities are in accordance with the substate 
plan or modification thereof, and with the cost limitations described in 
Sec.  631.14 of this part.



Sec.  631.32  Allocation of funds by the Governor.

    Of the funds allotted to the Governor by the Secretary under 
Sec.Sec. 631.11 and 631.12 of this part:
    (a) The Governor shall issue allocations to substate grantees, the 
sum of which shall be no less than 50 percent of the State's allotment 
(section 302(d)).
    (b)(1) The Governor shall prescribe the formula to be used in 
issuing substate allocations required under paragraph (a) of this 
section to substate grantees.
    (2) The formula prescribed pursuant to paragraph (b)(1) of this 
section shall utilize the most appropriate information available to the 
Governor. In prescribing the formula, the Governor shall include (but 
need not be limited to) the following information:
    (i) Insured unemployment data;
    (ii) Unemployment concentrations;
    (iii) Plant closing and mass layoff data;
    (iv) Declining industries data;
    (v) Farmer-rancher economic hardship data; and
    (vi) Long-term unemployment data.
    (3) The Governor may allow for an appropriate weight for each of the 
formula factors set forth in paragraph (b)(2) of this section. A weight 
of zero for any of the factors required in section 302(d) of the Act and 
identified in paragraph (b)(2) of this section shall only be made when a 
review of available data indicates that the factor is not relevant to 
determining the incidence of need for worker dislocation assistance 
within the State. The formula may be amended no more frequently than 
once each program year (section 302(d)).
    (c) The Governor may reserve an amount equal to not more than 40 
percent of the funds allotted to the State underSec. 631.11 andSec. 
631.12 of this part for State activities and for discretionary 
allocations to substate grantees (section 302(c)(1)).
    (d) The Governor may reserve an additional amount equal to not more 
than 10 percent of the funds allotted to the State underSec. 631.11 of 
this part. The Governor shall allocate such funds, subject to the SJTCC 
or HRIC review and comment, during the first three quarters of the 
program year among substate grantees on the basis of need. Such funds 
shall be allocated to substate grantees and shall not be used for 
statewide activities. Such funds shall be included in each substate 
grantee's allocation for purposes of cost limitations, as described in 
Sec.  631.14 of this part (sections 302(c)(2) and 317(1)(B)).



Sec.  631.33  State procedures for identifying funds subject to 
mandatory Federal reallotment.

    The Governor shall establish procedures to assure the equitable 
identification of funds required to be reallotted pursuant to section 
303(b) of the Act. Funds so identified may be funds reserved by the 
State pursuant to section 302(c)(1)(A) through (D) of the Act and/or 
allocated to substate grantees pursuant to section 302(c)(1)(E), (c)(2) 
and/or (d) of the Act (section 303(d)). Such procedures may not exempt 
either State or substate funds from reallotment.



Sec.  631.34  Designation of substate areas.

    (a) The Governor, after receiving recommendations from the SJTCC or 
HRIC, shall designate substate areas for the State (section 312(a)).
    (b) In designating substate areas, the Governor shall:
    (1) Ensure that each service delivery area within the State is 
included within a substate area and that no SDA is divided among two or 
more substate areas; and
    (2) Consider the availability of services throughout the State, the 
capability to coordinate the delivery of services with other human 
services and

[[Page 264]]

economic development programs, and the geographic boundaries of labor 
market areas within the State.
    (c) Subject to paragraph (b) of this section, the Governor shall 
designate as a substate area:
    (1) Any single SDA that has a population of 200,000 or more;
    (2) Any two or more contiguous SDA's that:
    (i) In the aggregate have a population of 200,000 or more; and
    (ii) Request such designation; and
    (3) Any concentrated employment program grantee for a rural area as 
described in section 101(a)(4)(A)(iii) of the Act.
    (d) In addition to the entities identified in paragraph (c) of this 
section, the Governor may, without regard to the 200,000 population 
requirement, designate SDAs with smaller populations as substate areas.
    (e) The Governor may deny a request for substate area designation 
from a consortium of two or more SDAs that meets the requirements of 
paragraph (c)(2) of this section only upon a determination that the 
request is not consistent with the effective delivery of services to 
eligible dislocated workers in the relevant labor market area, or would 
otherwise not be appropriate to carry out the purposes of title III. The 
Governor will give good faith consideration to all such requests by a 
consortium of SDAs to be a substate area. In denying a consortium's 
request for substate area designation, the Governor shall set forth the 
basis and rationale for the denial (section 312(a)(5)).
    (f) In the case where the service delivery area is the State, the 
entire State shall be designated as a single substate area.
    (g)(1) Entities described in paragraphs (c)(1) and (3) of this 
section may appeal the Governor's denial of substate area designation to 
the Secretary of Labor. The procedures that apply to such appeals shall 
be those set forth atSec. 628.405(g) for appeals of the Governor's 
denial of SDA designation.
    (2) An entity described in paragraph (c)(2) of this section that has 
been denied substate area designation may utilize the State-level 
grievance procedures required by section 144(a) of the Act and subpart E 
of part 627 of this chapter for the resolution of disputes arising from 
such a denial.
    (h) Designation of substate areas shall not be revised more 
frequently than once every two years. All such designations must be 
completed no later than four months prior to the beginning of any 
program year (section 312(a)(6)).



Sec.  631.35  Designation of substate grantees.

    The Governor may establish procedures for the designation of 
substate grantees.
    (a) Designation of the substate grantee for each substate area shall 
be made on a biennial basis.
    (b) Entities eligible for designation as substate grantees include:
    (1) Private industry councils in the substate area;
    (2) Service delivery area grant recipients or administrative 
entities designated under Title II of the Act;
    (3) Private non-profit organizations;
    (4) Units of general local government in the substate area, or 
agencies thereof;
    (5) Local offices of State agencies; and
    (6) Other public agencies, such as community colleges and area 
vocational schools.
    (c) Substate grantees shall be designated in accordance with an 
agreement among the Governor, the local elected official or officials of 
such area, and the private industry council or councils of such area. 
Whenever a substate area is represented by more than one such official 
or council, the respective officials and councils shall each designate 
representatives, in accordance with procedures established by the 
Governor (after consultation with the SJTCC or HRIC), to negotiate such 
agreement.
    (d) The agreement specified in paragraph (c) of this section shall 
set forth the conditions, considerations, and other factors related to 
the selection of substate grantees in accordance with section 312(b) of 
the Act.
    (e) The Governor shall negotiate in good faith with the parties 
identified in paragraph (c) of this section and shall make a good faith 
effort to reach agreement. In the event agreement

[[Page 265]]

cannot be reached on the selection of a substate grantee, the Governor 
shall select the substate grantee.
    (f) Decisions under paragraphs (c), (d), and (e) of this section are 
not appealable to the Secretary (section 312(b) and (c)).



Sec.  631.36  Biennial State plan.

    (a) In order to receive an allotment of funds under Sec.Sec. 
631.11 and 631.12 of this part, the State shall submit to the Secretary, 
in accordance with instructions issued by the Secretary, on a biennial 
basis, a biennial State plan (section 311). Such plan shall include:
    (1) Assurances that--
    (i) The State will comply with the requirements of Title III of the 
Act and this part;
    (ii) Services will be provided only to eligible displaced workers, 
except as provided in paragraph (a)(2) of this section;
    (iii) Services will not be denied on the basis of State of residence 
to eligible dislocated workers displaced by a permanent closure or 
substantial layoff within the State; and may be provided to other 
eligible dislocated workers regardless of the State of residence of such 
workers;
    (2) Provision that the State will provide services under this part 
to displaced homemakers only if the Governor determines that the 
services may be provided to such workers without adversely affecting the 
delivery of services to eligible dislocated workers;
    (3) A description of the substate allotment and reallotment 
procedures and assurance that they meet the requirements of the Act and 
this part;
    (4) A description of the State procurement system and procedures to 
be used under Title III of the Act and this part which are consistent 
with the provisions in subpart D of part 627 of this chapter; and
    (5) Assurance that the State will not prescribe any performance 
standard which is inconsistent withSec. 627.470 of this chapter.
    (b) The State biennial plan shall be submitted to the Secretary on 
or before the May 1 immediately preceding the first of the two program 
years for which the funds are to be made available.
    (c) Any plan submitted under paragraph (a) of this section may be 
modified to describe changes in or additions to the programs and 
activities set forth in the plan. No plan modification shall be 
effective unless reviewed pursuant to paragraph (d) of this section and 
approved pursuant to paragraph (e) of this section.
    (d) The Secretary shall review State biennial plans and plan 
modifications, including any comments thereon submitted by the SJTCC or 
HRIC, for overall compliance with the provisions of the Act, this part, 
and the instructions issued by the Secretary.
    (e) A State biennial plan or plan modification is submitted on the 
date of its receipt by the Secretary. The Secretary shall approve a plan 
or plan modification within 45 days of submission unless, within 30 days 
of submission, the Secretary notifies the Governor in writing of any 
deficiencies in such plan or plan modification.
    (f) The Secretary shall not finally disapprove the State biennial 
plan or plan modification of any State except after written notice and 
an opportunity to request and to receive a hearing before an 
administrative law judge pursuant to the provisions of subpart H of part 
627 of this chapter.



Sec.  631.37  Coordination activities.

    (a) Services under this part shall be integrated or coordinated with 
services and payments made available under Chapter 2 of Title II of the 
Trade Act of 1974 (19 U.S.C. 2271, et seq.) and part 617 of this chapter 
and programs provided by any State or local agencies designated under 
section 239 of the Trade Act of 1974 (19 U.S.C. 2311) or part 617 of 
this chapter (section 311(b)(10)). Such coordination shall be effected 
under provisions of an interagency agreement when the State agency 
responsible for administering programs under this part is different from 
the State agency administering Trade Act programs.
    (b) States may use funds allotted under Sec.Sec. 631.11 and 631.12 
of this part for coordination of worker readjustment programs, (i.e., 
programs under this part and trade adjustment assistance under part 617 
of this chapter) and the unemployment compensation system

[[Page 266]]

consistent with the limitation on administrative expenses (seeSec. 
631.14(a)(1) of this part). Each State shall be responsible for 
coordinating the unemployment compensation system and worker 
readjustment programs (section 314(f)).
    (c) Services under this part shall be coordinated with dislocated 
worker services under Title III of the Carl D. Perkins Vocational 
Education Act (20 U.S.C. 2351, et seq.) (section 311(b)(5)).
    (d) In promoting labor management cooperation, including the 
formation of labor-management committees under this part, the dislocated 
worker unit shall consider cooperation and coordination with labor-
management committees established under other authorities (section 
311(b)(3)(B)).
    (e) In accordance with section 402 of the Veterans' Benefits and 
Programs Improvement Act of 1988 (29 U.S.C. 1751 note) services under 
this part shall be coordinated with programs administered by the 
Department of Veterans Affairs and with other veterans' programs such as 
the Veterans' Job Training Act (29 U.S.C. 1721 note), title IV-C of the 
Job Training Partnership Act (29 U.S.C. 1721, et seq.), part 635 of this 
chapter, and the Transition Assistance Program.



Sec.  631.38  State by-pass authority.

    (a)(1) In the event that a substate grantee fails to submit a plan, 
or submits a plan which is not approved by the Governor (seeSec. 
631.50(f) of this part), the Governor may direct the expenditure of 
funds allocated to the substate area.
    (2) The Governor's authority under this paragraph (a) to direct the 
expenditure of funds remains in effect only until such time as a plan is 
submitted and approved, or a new substate grantee is designated (section 
313(c)).
    (3) The Governor shall not direct the expenditure of funds under 
this paragraph (a) until after the affected substate grantee has been 
afforded advance written notice of the Governor's intent to exercise 
such authority and an opportunity to appeal to the Secretary pursuant to 
the provisions ofSec. 628.426(e) of this chapter.
    (b)(1) If a substate grantee fails to expend funds allocated to it 
in accordance with its plan, the Governor, subject to appropriate notice 
and opportunity for comment in the manner required by section 105(b)(1), 
(2), and (3) of the Act, may direct the expenditure of funds only in 
accordance with the substate plan.
    (2) The Governor's authority under this paragraph (b) to direct the 
expenditure of funds shall remain in effect only until:
    (i) The substate grantee corrects the failure;
    (ii) The substate grantee submits an acceptable modification; or
    (iii) A new substate grantee is designated (section 313(a) and (d)).
    (3) The Governor shall not direct the expenditure of funds under 
this paragraph (b) until after the affected substate grantee has been 
afforded advance written notice of the Governor's intent to exercise 
such authority and an opportunity to appeal to the Secretary pursuant to 
the provisions ofSec. 628.426(e) of this chapter.
    (c) When the substate area is the State, the Secretary shall have 
the same authority as the Governor under paragraphs (a) and (b) of this 
section.



                        Subpart E_State Programs



Sec.  631.40  State program operational plan.

    (a) The Governor shall submit to the Secretary biennially, in 
accordance with instructions issued by the Secretary, a State program 
operational plan describing the specific activities, programs and 
projects to be undertaken with the funds reserved by the Governor under 
Sec.  631.32(c) of this part.
    (b) The State program operational plan shall include a description 
of the mechanisms established between the Federal-State Unemployment 
Compensation System, the Trade Adjustment Assistance Program, the State 
Employment service and programs authorized under title III of the Act 
and this part to coordinate the identification and referral of 
dislocated workers and the exchange of information.



Sec.  631.41  Allowable State activities.

    (a) States may use funds reserved underSec. 631.32(c) of this 
part, subject to

[[Page 267]]

the provisions of the State biennial and program operational plans, for:
    (1) Rapid response assistance;
    (2) Basic readjustment services when undertaken in Statewide, 
regional or industrywide projects, or, initially, as part of rapid 
response assistance;
    (3) Retraining services, including (but not limited to) those in 
section 314(d) of the Act when undertaken in Statewide, industrywide and 
regional programs;
    (4) Coordination with the unemployment compensation system, in 
accordance withSec. 631.37(b) of this part;
    (5) Discretionary allocation for basic readjustment and retraining 
services to provide additional assistance to substate areas that 
experience substantial increases in the number of dislocated workers, to 
be expended in accordance with the substate plan or a modification 
thereof;
    (6) Incentives to provide training of greater duration for those who 
require it; and
    (7) Needs-related payments in accordance with section 315(b) of the 
Act.
    (b) Activities shall be coordinated with other programs serving 
dislocated workers, including training under Chapter 2 of Title II of 
the Trade Act of 1974 (19 U.S.C. 2271, et seq.) and part 617 of this 
chapter.
    (c) Where appropriate, State-level activities should be coordinated 
with activities and services provided by substate grantees.
    (d) Retraining services provided to individuals with funds available 
to a State should be limited to those individuals who can most benefit 
from and are in need of such services.
    (e) Other than basic and remedial education, literacy and English 
for non-English speakers training, retraining services provided with 
funds available to a State shall be limited to those for occupations in 
demand in the area or another area to which the participant is willing 
to relocate, or in sectors of the economy with a high potential for 
sustained demand or growth.
    (f) Services provided to displaced homemakers should be part of 
ongoing programs and activities under Title III and this part and not 
separate and discrete programs.
    (g) Basic readjustment services described inSec. 631.3(b)(1), 
provided to individuals who have not received a specific notice of 
termination or layoff and who work at a facility at which the employer 
has made a public announcement that such facility will close shall, to 
the extent practicable be funded by the State with funds reserved under 
Sec.  631.32(c) (section 314(h)).
    (h) The provisions of section 107(a), (b) and (e) of the Act (but 
not subsections (c) and (d) of section 107) andSec. 627.422 of this 
chapter apply to State selection of service providers for funded 
activities authorized inSec. 631.32(c) of this part.



                       Subpart F_Substate Programs



Sec.  631.50  Substate plan.

    (a) In order to receive an allocation of funds underSec. 631.32 of 
this part, the substate grantee shall submit to the Governor a substate 
plan, in accordance with instructions issued by the Governor. Such plan 
shall meet the requirements of this section and shall be approved by the 
Governor prior to funds being allocated to a substate grantee.
    (b) The Governor shall issue instructions and schedules that assure 
that substate plans and plan modifications conform to all requirements 
of the Act and this part and contain the statement required by section 
313(b) of the Act.
    (c) Substate plans shall provide for compliance with the cost 
limitation provisions ofSec. 631.14 of this part.
    (d) The SJTCC or HRIC shall review and submit to the Governor 
written comments on substate plans.
    (e) Prior to the submission of the substate plan to the Governor, 
the substate grantee shall submit the plan to the parties to the 
agreement described inSec. 631.35(c) of this part for review and 
comment (section 313(a)).
    (f) The Governor's review and approval (or disapproval) of a 
substate plan or plan modification, and appeals to the Secretary from 
disapprovals thereof, shall be conducted according to the provisions of 
section 105 of the Act andSec. 628.426 of this chapter (section 
313(c)).

[[Page 268]]

    (g) If a substate grantee fails to meet the requirements for plan 
submission and approval found in this section, the Governor may exercise 
the by-pass authority set forth atSec. 631.38 of this part.
    (h) When the substate area is the State, the substate plan (and plan 
modification(s)) shall be submitted by the Governor to the Secretary. 
The dates for submission and consideration and the Secretary's review 
and approval (or disapproval) of the plan or plan modification, and 
appeals to administrative law judges from disapproval thereof, shall be 
conducted according to the provisions ofSec. 628.430 of this chapter.



Sec.  631.51  Allowable substate program activities.

    (a) The substate grantee may use JTPA section 302(c)(1), (c)(2), and 
(d) funds allocated by the Governor underSec. 631.32 of this part for 
basic readjustment services, retraining services, supportive services 
and needs-related payments.
    (b) The provisions of Sec.Sec. 627.420 and 627.435 of this chapter 
(Procurement, Cost principles and allowable costs) apply to funds 
allocated to substate grantees under this part unless otherwise 
specifically provided for.
    (c) Other than basic and remedial education, literacy and English 
for non-English speakers training, retraining services provided with 
funds available to a substate area shall be limited to those for 
occupations in demand in the area or another area to which the 
participant is willing to relocate, or in sectors of the economy with a 
high potential for sustained demand or growth.
    (d) Retraining services provided to individuals with funds available 
to a substate area should be limited to those individuals who can most 
benefit from and are in need of such services (sections 312(e) and 
141(a)).



Sec.  631.52  Selection of service providers.

    (a) The substate grantee shall provide authorized JTPA Title III 
services within the substate area, pursuant to an agreement with the 
Governor and in accordance with the approved State plan and substate 
plan, including the selection of service providers.
    (b) The substate grantee may provide authorized JTPA Title III 
services directly or through contract, grant, or agreement with service 
providers (section 312(d)).
    (c) Services provided to displaced homemakers should be part of 
ongoing programs and activities under Title III of the Act and this part 
and not separate and discrete programs.
    (d) The provisions of section 107(a), (b), (c) and (e) of the Act 
andSec. 627.422 of this chapter apply to substate grantee selection of 
service providers as specified in this section.



Sec.  631.53  Certificates of continuing eligibility.

    (a) A substate grantee may issue to any eligible dislocated worker 
who has applied for the program authorized in this part a certificate of 
continuing eligibility. Such a certificate of continuing eligibility:
    (1) May be effective for periods not to exceed 104 weeks;
    (2) Shall not include any reference to any specific amount of funds;
    (3) Shall state that it is subject to the availability of funds at 
the time any such training services are to be provided; and
    (4) Shall be non-transferable.
    (b) Acceptance of a certificate of continuing eligibility shall not 
be deemed to be enrollment in training.
    (c) Certificates of continuing eligibility may be used, subject to 
the conditions included on the face of the certificate, in two distinct 
ways:
    (1) To defer the beginning of retraining: any individual to whom a 
certificate of continuing eligibility has been issued under paragraph 
(a) of this section shall remain eligible for retraining and education 
services authorized under this part for the period specified in the 
certificate, notwithstanding the definition of ``eligible dislocated 
worker'' in section 301(a) of the Act or the participant eligibility 
provisions inSec. 631.3 of this part, and may use the certificate in 
order to receive retraining services, subject to the limitations 
contained in the certificate; or
    (2) To permit eligible dislocated workers to seek out and arrange 
their own retraining with service providers

[[Page 269]]

approved by the substate grantee; retraining provided pursuant to the 
certificate shall be in accord with requirements and procedures 
established by the substate grantee and shall be conducted under a 
grant, contract, or other arrangement between the substate grantee and 
the service provider.
    (d) Substate grantees shall ensure that records are maintained 
showing to whom such certificates of continuing eligibility have been 
issued, the dates of issuance, and the number redeemed by substate 
grantees.



    Subpart G_Federal Delivery of Dislocated Worker Services Through 
                     National Reserve Account Funds



Sec.  631.60  General.

    This subpart provides for the use of funds reserved to the Secretary 
for use under part B of title III of the Act. These funds may be used 
for the allowable activities, described in section 323 of the Act; 
demonstration programs, described in section 324 of the Act; the Defense 
Conversion Adjustment Program (DCAP), described in section 325 of the 
Act; the Defense Diversification Program (DDP), described in section 
325A of the Act; Clean Air Employment Transition Assistance (CAETA), 
described in section 326 of the Act; and similar uses and programs which 
may be added to part B of title III of the Act.



Sec.  631.61  Application for funding and selection criteria.

    To qualify for consideration for funds reserved by the Secretary for 
activities under section 323 of the Act, applications shall be submitted 
to the Secretary pursuant to instructions issued by the Secretary 
specifying application procedures, selection criteria, and approval 
process. Separate instructions will be issued for each category of grant 
awards, as determined by the Secretary.



Sec.  631.62  Cost limitations.

    The expenditure of funds provided to grantees under this subpart 
shall be consistent with the cost limitations specified in the grant. 
Applicants for grants under this subpart may propose, in their grant 
applications, reasonable costs to be incorporated into the grant. The 
Grant Officer may accept or modify such proposals at his/her discretion. 
Where proposals do not adequately justify to the Grant Officer's 
satisfaction the costs to be incorporated into the grant, the cost 
limitations that shall be applied shall be those specified in section 
315 of the Act and described in paragraphs (a), (b) and (c) ofSec. 
631.14 of this part.



Sec.  631.63  Reporting.

    (a) Grantees under part B of title III of the Act shall submit 
reports as prescribed by the Secretary.
    (b) Significant developments. Grantees shall notify the Secretary of 
developments that have a significant impact on the grant or subgrant 
supported activities, including problems, delays, or adverse conditions 
which may materially impair the ability to meet the objectives of the 
project. This notification shall include a statement of the action 
taken, or contemplated, and any assistance needed to resolve the 
situation.



Sec.  631.64  General administrative requirements.

    (a) Activities under this subpart may be carried out and funding 
provided directly to grantees other than States.
    (b) All grantees and subgrantees under this subpart that are States 
or substate grantees are subject to the provisions in part 627 of this 
chapter.
    (c) For grantees other than States and substate grantees, the 
following provisions shall apply to grants under this subpart.
    (1) Grievance procedures. (i) Each grantee shall establish and 
maintain a grievance procedure for grievances or complaints about its 
programs and activities from participants, subgrantees, subcontractors, 
and other interested persons. Hearings on any grievance shall be 
conducted within 30 days of filing of a grievance and decisions shall be 
made not later than 60 days after the filing of a grievance. Except for 
complaints alleging fraud or criminal activity, complaints shall be made 
within one year of the alleged occurrence.

[[Page 270]]

    (ii) Grantees shall be subject to the provisions of section 144 of 
the Act, and 29 CFR part 95 or 97, as appropriate.
    (iii) If the grantee is already subject to the grievance procedure 
process and requirements established by the Governor (i.e., through 
another JTPA grant, subgrant, or contract), its adherence to that 
procedure shall meet the requirements of this paragraph (c)(1).
    (2) Uniform Administrative Standards. Grantees shall be subject to 
the standards and requirements described in 29 CFR part 95 or 97, as 
appropriate, as well as any additional standards prescribed in grant 
documents or Secretarial guidelines. If the grantee/ subgrantee is 
already subject to additional standards established by the Governor 
(i.e., through another JTPA grant, subgrant, or contract), its adherence 
to those standards shall meet the requirements of this paragraph (c)(2).



Sec.  631.65  Special provisions for CAETA and DDP.

    (a) Allowances for job search outside the commuting area under 
CAETA. Allowances for job search outside the commuting area shall be an 
allowable activity under CAETA, only where it has been determined that 
the dislocated worker cannot reasonably be expected to secure suitable 
employment within the commuting area in which the worker resides. 
Procedures for determining whether a dislocated worker cannot reasonably 
be expected to secure suitable employment within the commuting area in 
which the dislocated worker resides shall be described in the grant 
application and shall be subject to approval by the Grant Officer. The 
cost of job search outside the commuting area shall be an allowable 
cost, but shall not provide for more than 90 percent of the cost of 
necessary job search expenses, and may not exceed a total of $800, 
unless the need for a greater amount is justified in the grant 
application and approved by the Grant Officer.
    (b) Relocation allowances under CAETA. Relocation allowances under 
CAETA shall be allowable only where the eligible dislocated worker 
cannot reasonably be expected to secure suitable employment in the 
commuting area in which the worker resides and has obtained suitable 
employment affording a reasonable expectation of long-term duration in 
the area in which the worker wishes to relocate, or has obtained a bona 
fide offer of such employment, provided that the worker is totally 
separated from employment at the time relocation commences. The cost of 
relocation for an eligible dislocated worker shall not exceed an amount 
which is equal to the sum of the reasonable and necessary expenses 
incurred in transporting the dislocated worker and the dislocated 
worker's family, if any, and household effects, and a lump sum 
relocation allowance, equivalent to three times such worker's average 
weekly wage. The maximum relocation allowance, however, shall not exceed 
$800, unless a greater amount is justified in the grant application and 
approved by the Grant Officer. Necessary expenses shall be travel 
expenses for the dislocated worker and the dislocated worker's family 
and for the transfer of household effects. Reasonable costs for such 
travel and transfer expenses shall be by the least expensive, most 
reasonable form of transportation.
    (c) Needs-related payments under CAETA and DDP. Funds from grants 
for CAETA and DDP shall be available for needs-related payments to 
enable participants to participate in and complete training or education 
programs under those grants, subject to the following:
    (1) Needs-related payments shall be provided to the participant only 
if the participant:
    (i) Does not qualify or has ceased to qualify for unemployment 
compensation;
    (ii) Has been enrolled in training programs by the end of the 13th 
week of an individual's initial unemployment benefit period following 
the layoff or termination, or, if later, the end of the 8th week after 
an individual is informed that a short-term layoff will exceed six 
months;
    (iii) Is making satisfactory progress in training or education 
programs

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under this section, except that an individual shall not be disqualified 
pursuant to this clause for a failure to participate that is not the 
fault of the individual; and
    (iv) Currently receives, or is a member of a family which currently 
receives, a total family income (exclusive of unemployment compensation, 
child support payments, and welfare payments) which, in relation to 
family size, is not in excess of the lower living standard income level.
    (2) Needs-related payments shall be equal to the higher of:
    (i) The applicable level of unemployment compensation; or
    (ii) The poverty level determined in accordance with the criteria 
established by the Director of the Office of Management and Budget.
    (3) Total family income shall be reviewed periodically, based upon 
information obtained from participants with respect to such income and 
changes therein, to determine continued eligibility, or to begin 
payments to individuals previously found ineligible for needs-related 
payments under this section.

Subpart H [Reserved]



             Subpart I_Disaster Relief Employment Assistance



Sec.  631.80  Scope and purpose.

    This subpart establishes a Disaster Relief Employment Assistance 
program under title IV, part J of JTPA which shall be administered in 
conjunction with the title III National Reserve Grants Programs.



Sec.  631.81  Availability of funds.

    Funds appropriated to carry out this subpart may be made available 
by grant to the Governor of any State within which is located an area 
that has suffered an emergency or a major disaster as defined in 
paragraphs (1) and (2), respectively, of section 102 of the Disaster 
Relief Act of 1974 (42 U.S.C. 5122(1) and (2)) (referred to in this 
subpart as the ``disaster area''). The Secretary shall prescribe 
procedures for applying for funds.



Sec.  631.82  Substate allocation.

    (a) Not less than 80 percent of the grant funds available to any 
Governor underSec. 631.81 of this part shall be allocated by the 
Governor to units of general local government located, in whole or in 
part, within such disaster areas. The remainder of such funds may be 
reserved by the Governor for use, in concert with State agencies, in 
cleanup, rescue, repair, renovation, and rebuilding activities 
associated with such major disaster.
    (b) The JTPA title III program substate grantee for the disaster 
area shall be the designated local entity for administration of the 
grant funds under this subpart.



Sec.  631.83  Coordination.

    Funds made available under this subpart to Governors and units of 
general local government shall be expended in consultation with--
    (a) Agencies administering programs for disaster relief provided 
under the Disaster Relief Act of 1974; and
    (b) The JTPA title II administrative entity and the private industry 
council in each service delivery area within which disaster employment 
programs will be conducted under this subpart.



Sec.  631.84  Allowable projects.

    Funds made available under this subpart to any unit of general local 
government in a disaster area--
    (a) Shall be used exclusively to provide employment on projects that 
provide food, clothing, shelter and other humanitarian assistance for 
disaster victims; and on projects involving demolition, cleanup, repair, 
renovation, and reconstruction of damaged and destroyed structures, 
facilities, and lands located within the disaster area; and
    (b) May be expended through public and private non-profit agencies 
and organizations engaged in such projects.



Sec.  631.85  Participant eligibility.

    An individual shall be eligible for disaster employment under this 
subpart if such individual is--
    (a)(1) Eligible to participate or enroll, or is a participant or 
enrolled, under Title III of the Act, other than

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an individual who is actively engaged in a training program; or
    (2) Eligible to participate in programs or activities assisted under 
Native American and Migrant Programs; and
    (3) Unemployed as a consequence of the disaster.
    (b) [Reserved]



Sec.  631.86  Limitations on disaster relief employment.

    No individual shall be employed under this subpart for more than 6 
months for work related to recovery from a single natural disaster 
(described inSec. 631.3(f) of this part).



Sec.  631.87  Definitions.

    As used in this subpart, the term unit of general local government 
includes:
    (a) In the case of a community conducting a project in an Indian 
reservation or Alaska Native village, the grantee designated under the 
JTPA section 401 Indian and Native American Program (see part 632 of 
this chapter), or a consortium of such grantees and the State; and
    (b) In the case of a community conducting a project in a migrant or 
seasonal farmworker community, the grantee designated under the JTPA 
section 402 Migrant and Seasonal Farmworker Program (see part 633 of 
this chapter), or a consortium of such grantees and the State.



PART 632_INDIAN AND NATIVE AMERICAN EMPLOYMENT AND TRAINING PROGRAMS
--Table of Contents



                         Subpart A_Introduction

Sec.
632.1 [Reserved]
632.2 Scope and purpose.
632.3 Format for these regulations.
632.4 Definitions.

    Subpart B_Designation Procedures for the Native American Grantees

632.10 Eligibility requirements for designation as a Native American 
          grantee.
632.11 Designation of Native American grantees.
632.12 Alternative arrangements for the provision of services, 
          nondesignation.
632.13 Review of denial of designation as a Native American grantee, or 
          rejection of a Comprehensive Annual Plan.

   Subpart C_Program Planning, Application and Modification Procedures

632.17 Planning process.
632.18 Regional and national planning meetings.
632.19 Grant application content.
632.20 Submission of grant application.
632.21 Application disapproval.
632.22 Modification of a Comprehensive Annual Plan (CAP) and/or Master 
          Plan.
632.23 Termination and corrective action of a CAP and/or Master Plan.

            Subpart D_Administrative Standards and Procedures

632.31 General.
632.32 Financial management systems.
632.33 Audits.
632.34 Program income.
632.35 Native American grantee contracts and subgrants.
632.36 Procurement standards.
632.37 Allowable costs.
632.38 Classification of costs.
632.39 Administrative cost plan.
632.40 Administrative staff and personnel standards.
632.41 Reporting requirements.
632.42 Grant closeout procedures.
632.43 Reallocation of funds.
632.44 Sanctions for violation of the Act.

                 Subpart E_Program Design and Management

632.70 Waiver of regulations under parts 632 and 636.
632.75 General responsibilities of Native American grantees.
632.76 Program management systems.
632.77 Participant eligibility determination.
632.78 Training activities.
632.79 Employment activities.
632.80 Other activities.
632.81 Payments to participants.
632.82 Benefits and working conditions for participants.
632.83 FICA.
632.84 Non-Federal status of participants.
632.85 Participant limitations.
632.86 Nondiscrimination and nonsectarian activities.
632.87 Equitable provision of services to the eligible population and 
          significant segments.
632.88 General responsibilities of the Department.
632.89 Performance standards.

[[Page 273]]

             Subpart F_Prevention of Fraud and Program Abuse

632.115 General.
632.116 Conflict of interest.
632.117 Kickbacks.
632.118 Nepotism.
632.119 Political patronage.
632.120 Political activities.
632.121 Lobbying activities.
632.122 Unionization and antiunionization activities; work stoppages.
632.123 Maintenance of effort.
632.124 Theft or embezzlement from employment and training funds; 
          improper inducement; obstruction of investigations and other 
          criminal provisions.
632.125 Responsibilities of Native American grantees, subgrantees and 
          contractors for preventing fraud and program abuse and for 
          general program management.

Subpart G [Reserved]

Subpart H_Job Training Partnership Act Programs Under Title IV, Section 
                                   401

632.170 Eligibility for funds.
632.171 Allocation of funds.
632.172 Eligibility for participation in title IV, section 401.
632.173 Allowable program activities.
632.174 Administrative costs.

         Subpart I_Summer Youth Employment and Training Programs

632.250 General.
632.251 Eligibility for funds.
632.252 Allocation of funds.
632.253 Special operating provisions.
632.254 Program startup.
632.255 Program planning.
632.256 Submission of applications.
632.257 Eligibility for participation.
632.258 Allowable activities.
632.259 Vocational exploration program.
632.260 Worksite standards.
632.261 Reporting requirements.
632.262 Termination date for the summer program.
632.263 Administrative costs.

    Authority: 29 U.S.C. 1579(a).

    Source: 48 FR 48754, Oct. 20, 1983, unless otherwise noted.



                         Subpart A_Introduction



Sec.  632.1  [Reserved]



Sec.  632.2  Scope and purpose.

    It is the purpose of Native American programs to provide job 
training and employment activities consistent with the intent of title 
IV, part A, section 401. Such programs shall be administered in such a 
manner as to maximize the Federal commitment to support growth and 
development as determined by representatives of the communities and 
groups served by this section including furtherance of the policy of 
Indian Self-Determination.



Sec.  632.3  Format for these regulations.

    Regulations promulgated by the Department of Labor to implement the 
provisions of title IV, section 401 and Indian programs under title II-B 
of the Act are set forth in 20 CFR part 632. This part in conjunction 
with part 636 contains all the regulations under the Act applicable to 
Indian and Native American programs.



Sec.  632.4  Definitions.

    Act--means the Job Training Partnership Act (29 U.S.C. section 1501 
et seq.).
    Capital improvement--means any modification, addition, restoration 
or other improvement:
    (a) Which increases the usefulness, productivity, or serviceable 
life of an existing building, structure, or major item of equipment;
    (b) Which is classified for accounting purposes as a ``fixed 
asset;'' and
    (c) The cost of which increases the recorded value of the existing 
building, structure, or major item of equipment and is subject to 
depreciation.
    Community based organization--means a private nonprofit organization 
which is representative of the Indian and Native American community or 
significant segments of the community and which provides employment and 
training services or activities.
    Comprehensive Annual Plan (CAP)--means the annual update to the 
Master Plan. The CAP will identify the work plan and budget for the 
annual 401 and title II, part B funding allocations.
    Construction--means the erection, installation, assembly or painting 
of a new structure or a major addition, expansion or extension of an 
existing structure and the related site preparation, excavation, filling 
and landscaping or other land improvements.
    Contract--means a procurement instrument, other than a grant, by 
which the Department, a Native American

[[Page 274]]

grantee or a subgrantee acquires and pays for property, services, 
supplies, materials or equipment.
    Contractor--means any person, corporation, partnership, public 
agency, or other entity which enters into a contract with the DOL, a 
Native American grantee or subgrantee under the Act.
    Department--means the United States Department of Labor (DOL) 
including its agencies and organizational units.
    Dependent--means any person for whom, both currently and during the 
previous 12 months, the participant has assumed 50 percent of the 
person's support.
    DINAP--means the Division of Indian and Native American Programs of 
the Department of Labor.
    DOL--means the U.S. Department of Labor.
    Economically disadvantaged--means an individual who
    (a) Receives, or is a member of a family which receives, cash 
welfare payments under a Federal, State, or local welfare program;
    (b) Has, or is a member of a family which has, received a total 
family income for the six-month period prior to application for the 
program involved (exclusive of unemployment compensation, child support 
payments, and welfare payments) which, in relation to family size, was 
not in excess of the higher of
    (1) The poverty level determined in accordance with criteria 
established by the Department of Health and Human Services, or
    (2) 70 percent of the lower living standard income level;
    (c) Is receiving food stamps pursuant to the Food Stamp Act of 1977;
    (d) Is a foster child on behalf of whom State or local government 
payments are made; or
    (e) Is a handicapped individual whose own income meets the 
requirements of paragraph (a) or (b) of this definition, but who is a 
member of a family whose income does not meet such requirements.
    Entered employment--means the act of securing unsubsidized 
employment for or by a participant.
    Entry level--means the lowest position in any promotional line, as 
defined locally by collective bargaining agreements, past practice, or 
applicable personnel rules.
    Family--means (a) One or more persons living in a single residence 
who are related to each other by blood, marriage, or adoption. A step-
child or a step-parent is considered to be related by marriage.
    (b)(1) For purposes of paragraph (a) of this definition, one or more 
persons not living in the single residence but who are claimed as a 
dependent on another person's Federal Income Tax return for the previous 
year is presumed, unless otherwise demonstrated, to be part of the other 
person's family.
    (2) A handicapped individual may be considered a family of one when 
applying for programs under the Act.
    (3) An individual 18 years of age or older, except as provided in 
(b) (1) or (2) of this definition, who receives less than 50 percent of 
support from the family, and who is not the principal earner nor the 
spouse of the principal earner shall not be considered a member of the 
family. Such an individual shall be considered a family of one.
    Family income--means all income actually received from all sources 
by all members of the family for the six-month period prior to 
application. Family size is the maximum number of family members during 
the six-month period prior to application. When computing family income, 
income of a spouse and other family members is counted for the portion 
of the six-month period prior to application that the person was 
actually a part of the family unit.
    (a) For the purposes of determining participant eligibility (and not 
for grantee allocations), family income includes:
    (1) Gross wages, including CSE, Work Experience and OJT paid from 
JTPA funds, and salaries (before deductions);
    (2) Net self-employment income (gross receipts minus operating 
expenses); and
    (3) Other money income received from sources such as interest, net 
rents, OASI (Old Age and Survivors Insurance) social security benefits, 
pensions, alimony, and periodic income from insurance policy annuities, 
and other sources of income.

[[Page 275]]

    (b) Family income does not include:
    (1) Non-cash income such as food stamps, or compensation received in 
the form of food or housing;
    (2) Imputed value of owner-occupied property, i.e., rental value;
    (3) Public assistance payments;
    (4) Cash payments received pursuant to a State plan approved under 
titles I, IV, X or XVI of the Social Security Act, or disability 
insurance payments received under title II of the Social Security Act;
    (5) Federal, State or local unemployment benefits;
    (6) Capital gains and losses;
    (7) One time unearned income, such as, but not limited to:
    (i) Payments received for a limited fixed term under income 
maintenance programs and supplemental (private) unemployment benefits 
plans;
    (ii) One-time or fixed-term scholarship and fellowship grants;
    (iii) Accident, health, and casualty insurance proceeds;
    (iv) Disability and death payments, including fixed term (but not 
lifetime) life insurance annuities and death benefits;
    (v) One-time awards and gifts;
    (vi) Inheritance, including fixed term annuities;
    (vii) Fixed term workers' compensation awards;
    (viii) Terminal leave pay;
    (ix) Soil bank payments; and
    (x) Agriculture crop stabilization payments;
    (8) Pay or allowances which were previously received by any veteran 
while serving on active duty in the Armed Forces;
    (9) Educational assistance and compensation payments to veterans and 
other eligible persons under chapters 11, 13, 31, 34, 35, and 36, of 
title 38, United States Code;
    (10) Payments received under the Trade Act of 1974;
    (11) Black Lung payments received under the Benefits Reform Act of 
1977, Pub. L. 95-239, 30 U.S.C. 901;
    (12) Child support payments; and
    (13) Any income directly or indirectly derived from, or arising out 
of, any property held by the United States in trust for any Indian 
tribe, band or group or any individual; per capita payments; and 
services, compensation or funds provided by the United States in 
accordance with, or generated by, the exercise of any right guaranteed 
or protected by treaty; and any property distributed or income derived 
there-from, or any amounts paid to or for any individual member, or 
distributed to or for the legatees or next of kin of any member, derived 
from or arising out of the settlement of an Indian claim.
    Financial assistance--means any grant, loan, or any other 
arrangement by which the Department or Native American grantee provides 
or otherwise makes available assistance in the form of:
    (a) Funds;
    (b) Services of Federal or Native American grantee personnel; or
    (c) Real and personal property or any interest in or use of such 
property, including:
    (1) Transfers or leases of such property for less than fair market 
value or for reduced consideration and
    (2) Proceeds from a subsequent transfer or lease of such property if 
the Federal or Native American grantee share of its fair market value is 
not returned to the Federal Government or Native American grantee.
    Governing body--means a body consisting of duly elected or 
designated representatives, a body appointed by duly elected officials, 
or a body selected in accordance with traditional tribal means which has 
the authority to provide services to, and to enter into contracts, 
agreements and grants under this part on behalf of the organization or 
individuals who elected or designated them, elected the appointing 
official, or recognize the body selected in accordance with traditional 
tribal means.
    Governor--means the chief executive of any State.
    Handicapped individual--means any individual who has a physical or 
mental disability which for such individual constitutes or results in a 
substantial handicap to employment.
    Hawaiian Native--means any individual, any of whose ancestors were 
natives, prior to 1778, of the area which now comprises the State of 
Hawaii (Sec. 3(12)).

[[Page 276]]

    JTPA--means the Job Training Partnership Act.
    Local Educational Agency (LEA)--means such an agency as defined in 
section 195(10) of the Vocational Educational Act of 1963. It shall 
further mean the governing bodies of any Bureau of Indian Affairs, 
tribal or reservation run agencies or school districts, or any nonprofit 
agency or tribally chartered entity providing educational services to 
Indian and Native American persons as determined by the Native American 
grantee.
    Low Income Housing--means: (a) For weatherization or winterization 
projects, those dwellings occupied by persons whose family income does 
not exceed 125 percent of the poverty level and which are:
    (1) Owned by the occupant;
    (2) Publicly owned;
    (3) Owned by a private nonprofit organization;
    (4) Cooperatively owned; or
    (5) For projects funded and approved by the Federal Energy 
Administration, privately owned rental housing.
    (b) For rehabilitation as part of community revitalization or 
stabilization, housing built or improved with the assistance of Federal, 
State or tribal programs, and those dwellings occupied by persons whose 
family income does not exceed 80 percent of the median income for the 
area, in accordance with section 8(f)(1) of the United States Housing 
Act of 1937 (42 U.S.C. 1437f) and which are:
    (1) Owned by the occupant;
    (2) Publicly owned;
    (3) Owned by a private nonprofit organization; or
    (4) Cooperatively owned.
    Lower living standard income level--means that income level 
(adjusted for regional, metropolitan, urban, and rural differences and 
family size) determined annually by the Secretary based on the most 
recent ``lower living family budget'' issued by the Secretary.
    Master plan--means the basic long term agreement between the 
Department and the Native American grantee. The master plan contains all 
basic eligibility determination and administrative information.
    Native American community benefit--means the outcome of allowable 
activities undertaken for the advancement of economic and social 
development in the Indian, Alaskan Native, and Hawaiian Native 
communities consistent with their goals and life styles as determined by 
representatives of the community.
    Offender--means any adult or juvenile who is or has been subject to 
any stage of the criminal justice process for whom services under this 
part may be beneficial or who requires assistance in overcoming 
artificial barriers to employment resulting from a record of arrest or 
conviction.
    Older worker--means a person who is 55 years of age or older.
    Participant--means an individual who has:
    (a) Been determined eligible for participation; and
    (b) Started receiving employment, training or services (except post-
termination services) funded under the Act, within 45 days of such 
determination.
    Poverty level--means the annual income level at or below which 
families are considered to live in poverty, as annually determined by 
the Department of Health and Human Services.
    Program income--means net income earned from grant or agreement 
supported activities. Such earnings include but are not limited to: 
income from service fees, sale of commodities, usage or rental fees, and 
royalities on patents or copyrights.
    Program year--means that 12-month period of time during which job 
training activities and services and provided to participants.
    Public assistance--means Federal, State, tribal, or local government 
cash payments for which eligibility is determined by a need or income 
test.
    Secretary--means the Secretary of Labor.
    Similarly employed--means that status of a person who is working for 
the same employer as the JTPA participant, is doing the same type of 
work, and is similarly classified with respect to employment status 
(e.g., full-time, permanent, or temporary).
    State--means the several States, the District of Columbia, the 
Commonwealth of Puerto Rico, the Virgin Islands, Guam, the Northern 
Marianas Islands, American Samoa, and the Trust Territory of the Pacific 
Islands.

[[Page 277]]

    State Employment Security Agency (SESA)--means the State agency 
which exercises control over the Unemployment Insurance Service and the 
Employment Service.
    Subgrantee--means any person, corporation, partnership, public 
agency, or other entity, excluding private for profits concerns, which 
enters into a grant with the Native American Grantee.
    Underemployed persons--means:
    (a) Persons who are working part-time but seeking full-time work; or
    (b) Persons who are working full-time but whose current annualized 
wage rate (for a family of one), or whose family's current annualized 
income, is not in excess of:
    (1) The poverty level, or
    (2) 70 percent of the lower living standard income level.
    Unemployed persons--means individuals who are without jobs and who 
want and are available for work. The determination of whether 
individuals are without jobs shall be made in accordance with the 
criteria used by the Bureau of Labor Statistics of the Department of 
Labor in defining individuals as unemployed.



      Subpart B_Designation Procedures for Native American Grantees



Sec.  632.10  Eligibility requirements for designation as a Native
American grantee.

    (a) All funds specifically identified in the Act as reserved for the 
benefit of Indian and Native American participants shall be disbursed by 
the Department only to Native American grantees designated pursuant to 
this subpart. Except for FY 1984, designation will be for a period of 
two years.
    (b) To be designated as a Native American grantee, an applicant must 
have:
    (1) A governing body;
    (2) For new grantees, an Indian or Native American population within 
its designated service area of at least 1,000 persons;
    (3) The capability to administer an Indian and Native American 
employment and training program. For purposes of this paragraph, 
``capability to administer'' means that the applicant can demonstrate 
that it possesses, or can acquire the managerial, technical, or 
administrative staff with the ability to properly administer government 
funds, develop employment and training opportunities, evaluate program 
performance and comply with the provisions of the Act and the 
regulations. In judging the applicant's request for designation, 
consideration shall be given to factors such as:
    (i) Previous experience in operating an effective employment and 
training program serving Indians or Native Americans;
    (ii) The number and kind of activities of similar magnitude and 
complexity that the applicant has successfully completed;
    (iii) Information from other Federal agencies regarding program 
performance or financial and management capability.
    (c) The Department will not designate an organization in cases where 
it is established that:
    (1) The agency's efforts to recover debts (for which three demand 
letters have been sent) established by final agency action have been 
unsuccessful, or
    (2) Fraud or criminal activity has been proven to exist within the 
organization, or
    (3) The amount under the funding formulas will not total at least 
$120,000 in all JTPA funds for the first year of the two-year 
designation period. In the event that this amount cannot be determined 
at the time of the Department's decision on the request for designation, 
the amount shall be estimated in part by reference to the funding levels 
for Native American programs for the prior fiscal or program year. An 
applicant for designation shall be designated notwithstanding the 
limitation in this paragraph of this subsection if it demonstrates that:
    (i) It has or expects to receive a combined total of $120,000 in 
funds or services for the first year of the 2-year designation period 
from JTPA and other human resource development programs, including but 
not limited to those providing for employment, education, vocational 
education, health, social or similar services; or

[[Page 278]]

    (ii) It is recognized and directly funded by Federal agencies, such 
as the Indian-serving agencies within the Departments of the Interior, 
Health and Human Services or Education as the primary service delivery 
organization for the provision of human resource development services to 
Indians or Native Americans within the organization's customary service 
area. This provision shall be interpreted consistent with the Federal 
policy established in Pub. L. 96-638, the Indian Self-Determination Act; 
or
    (iii) It has demonstrated successful operation of an employment and 
training program at a level below $120,000 within the previous two 
years. For this purpose, success is the ability to adequately meet 
planned goals and stay within the grant's cost limits.
    (4) For a consortium to be designated, it must submit the consortium 
agreement which meets the requirements of this subpart.
    (d) Types of eligible Native American grantees:
    (1) Indian tribe, band or group. The Department shall designate as a 
Native American grantee an Indian tribe, band or group which meets the 
requirements in paragraphs (b) and (c) of this section.
    (2) Alaskan Native entity. The Department shall designate as a 
Native American grantee an Alaskan Native entity as defined in the 
Alaskan Native Claims Settlement Act which meets the requirements in 
paragraphs (b) and (c) of this section.
    (3) Hawaiian Native grantee. The Department may designate as a 
Native American grantee any private nonprofit organization or public 
agency representative of the Native Hawaiian community which meets the 
requirements in paragraphs (b) and (c) of this section and which the 
Department determines will best meet the needs of Native Hawaiians.
    (4) Public or private agencies. The Department may designate as a 
section 401 grantee a private nonprofit organization or public agency 
which meets the requirements in paragraphs (b) and (c) of this section 
to serve areas where there are significant numbers of Indians or Native 
Americans, but where there are no Indian tribes, bands or groups, 
Alaskan Native entities or Hawaiian sponsors or consortia of such 
sponsors eligible for designation.
    (5) Consortium grantees. The Department may designate as a Native 
American grantee a consortium of any of the types of grantees described 
in paragraphs (c), (1), (2), (3), and (4) of this section which may or 
may not be independently eligible. All such consortia shall meet the 
following requirements, in addition to the requirements in paragraphs 
(b) and (c) of this section:
    (i) All the members shall be in geographic proximity to one another. 
A consortium may operate in more than one State.
    (ii) An administrative unit shall be designated for operating the 
program, which may be a member of the consortium or an agency formed by 
the members. The administrative unit shall be delegated all powers 
necessary to administer the program effectively, including the power to 
enter into contracts and subgrants and other necessary agreements, to 
receive and expend funds, to employ personnel, to organize and train 
staff, to develop procedures for program planning, to monitor financial 
and program performance, and to modify the grant agreement through 
agreement with the Secretary. The right of reallocating funds within the 
consortium area shall be reserved to the consortium's members.
    (iii) The consortium shall be the Native American grantee. The 
consortium agreement shall be signed by an official or officials of each 
member of the consortium authorized to enter into a binding consortium 
and shall specify that each member shall be liable jointly or separately 
for claims established against the grantee. Additional standardized 
requirements for consortium agreements will be communicated to grantees 
under separate order.
    (e) In the situation where the Department does not designate Indian 
tribes, bands or groups or Alaska Native groups to serve such groups, 
the Department shall, to the maximum extent feasible, enter into 
arrangements for the provision of services to such groups with other 
types of section 401 grantees which meet with the approval of the Indian 
tribes, bands, groups or

[[Page 279]]

Alaska Native groups to be served (section 401(d)). In such cases, the 
Department shall consult with the governing body of such Indian tribes, 
bands, groups or Alaska Native groups prior to the designation of a 
Native American grantee.
    (f) In designating Native American grantees to serve groups other 
than those in paragraph (e) of this section, such as nonreservation 
Indians and Native Hawaiians, the Department shall, whenever feasible, 
designate grantees which are directly controlled by Indian or Native 
American people. Where it is not feasible to designate such types of 
grantees, DINAP shall consult with Indian or Native American-controlled 
organizations in the area with respect to the designation of a Native 
American grantee. Where a private nonprofit organization is designated, 
DINAP shall require any such grantees not directly controlled by Indian 
or Native American people to establish a Native American Employment and 
Training Planning Council and to implement an Indian preference policy 
with respect to hiring of staff and contracting for services with regard 
to all funds provided pursuant to this part (sec. 7(b) of the Indian 
Self-Determination and Education Assistance Act).



Sec.  632.11  Designation of Native American grantees.

    (a) When designations are required and the potential grantee is not 
under a Master Plan agreement, an applicant for designation as a Native 
American grantee shall submit a notice of intent to apply for funds. 
Such notices of intent shall be postmarked by January 1 and be submitted 
to the Division of Indian and Native American Programs (DINAP), 
Employment and Training Administration, U.S. Department of Labor, 601 D 
Street NW., Washington, DC. 20213. Notices of intent may also be 
delivered to that office in person not later than the close of business 
on January 2 or the first business day of the designation year. Such 
notices of intent to apply shall be submitted on Standard Form 424 as a 
preapplication for Federal assistance. For applicants not under an 
active Master Plan agreement or the Master Plan agreement is due to 
expire during the year of designation, the following information shall 
be included in the notice of intent:
    (1) Evidence that the applicant meets the requirements for a Native 
American grantee contained inSec. 632.10.
    (2) A description of the geographic area or areas which the 
applicant proposes to serve, together with the Indian and Native 
American population in such areas, to the extent known. The description 
must include a list of States (if more than one), in alphabetical order, 
and under each State, a list of counties in alphabetical order, followed 
by a list of tribes, bands or groups (if any) in alphabetical order. If 
the applicant was a Native American grantee for the period prior to the 
one which is being applied for, the applicant must also list any 
counties and tribes, bands or groups which are being added to, or 
deleted from, the previous fiscal year's service area;
    (3) A description of the applicant's organization, including the 
legal status of the applicant, the process of selection of the governing 
body, the duties and responsibilities of the governing body, and in the 
case of private nonprofit organizations, a copy of the articles of 
incorporation;
    (4) Evidence of the applicant's capability to operate an Indian or 
Native American employment and training program, including a statement 
of the applicant's past successes in operating programs for Indians or 
other Native Americans and a statement of the applicant's experience in 
managing the types of programs and activities allowable under the Act;
    (5) A description of the planning process including employer 
involvement which the applicant proposes to undertake in developing a 
plan for the use of funds;
    (6) Information related to a grantee's administrative 
responsibility. The DOL will conduct an independent review to determine 
whether each applicant is currently delinquent in repaying any DOL 
claims or has any outstanding administrative problems. Applicants are, 
therefore, encouraged to submit any documents related to these factors 
including documents and correspondence previously submitted to DOL. 
Submittal of such materials will enable

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DOL to move rapidly to complete the Notice of Intent and grantee 
designation review process.
    (7) If the applicant is applying as a consortium, evidence that the 
consortium meets the requirements for a consortium in this part and a 
consortium agreement as specified inSec. 632.10(d)(5)(iii).
    (b) If more than one organization submits a Notice of Intent for a 
geographic area, the Department will notify the organizations involved 
and conduct a special review for the area in question. The notice to the 
organizations will indicate any additional information needed and the 
review process to be followed.
    (c) If the applicant for designation is a current grantee, under a 
master plan agreement, and there is no change in the service area 
requested, only the Standard Form 424 and a statement(s) indicating that 
to the best of the applicant's knowledge, it meets the requirements of 
Sec.  632.10(c)(4) will be necessary and shall be submitted within the 
timeframe established inSec. 632.11(a).
    (d) Responsibility Review. Prior to finally designating, 
conditionally designating or nondesignating the Department will conduct 
a review of the available records to determine whether or not the 
organization has failed any responsibility test. This review is intended 
to establish overall responsibility to administer Federal funds. With 
the exception ofSec. 632.11 (c)(1) and (c)(3), the failure to meet any 
one of the following responsibility test factors would not establish 
that the organization is irresponsible unless the failure is substantial 
or persistent. The responsibility tests are as follows:
    (1) The agency's efforts to recover debts (for which three demand 
letters have been sent) established by final agency action have been 
unsuccessful, or failure to comply with an approved repayment plan.
    (2) Serious administrative deficiencies have been identified in 
final findings and determination--such as failure to maintain a 
financial management system as required by Federal regulations.
    (3) Established fraud or criminal activity exists within the 
organization.
    (4) Wilfull obstruction of the audit process.
    (5) Substantial failure to provide services to applicants as agreed 
to in a current or recent grant or to meet performance standards 
requirements as provided for and developed pursuant toSec. 632.89.
    (6) Failure to correct deficiencies brought to the grantee's 
attention in writing as a result of monitoring activities, reviews, 
assessments, etc.
    (7) Failure to return a grant closeout package on outstanding 
advances within 90 days of expiration date or receipt of closeout 
package, whichever is later, unless an extension has been requested and 
granted; final billings reflecting serious cost category or total budget 
cost overrun.
    (8) Failure to submit required reports.
    (9) Failure to properly report and dispose of government property as 
instructed by DOL.
    (10) Failure to have maintained cost controls resulting in excess 
cash on hand.
    (11) Failure to procure or arrange for audit coverage for any two 
year period when required by DOL.
    (12) Failure to audit subrecipient within the required period when 
applicable.
    (13) Final disallowed costs in excess of five percent of the grant 
or contract award.
    (14) Failure to establish a mechanism to resolve subrecipient's 
audit within established time frames.
    (e) On March 1 of each designation year, the Department shall 
designate or conditionally designate Native American grantees for the 
coming two program years. Each applicant shall be notified in writing of 
the determination. Those applicants that are not designated in whole or 
in part as Native American grantees may appeal under the complaint 
procedures available for this part. Conditional designations will 
include the nature of the conditions and the actions required to be 
finally designated.

(Approved by the Office of Management and Budget and assigned OMB 
control number 1205-0213)

[[Page 281]]



Sec.  632.12  Alternative arrangements for the provision of services,
nondesignation.

    (a) If no application for Native American grantee designation for an 
area is filed, or if the Department has denied such application for that 
area, the Department may designate and fund an entity to serve that 
area, pending the final resolution of any Petitions for Reconsideration 
or other actions taken pursuant toSec. 632.13. An organization not 
designated in whole or in part may also appeal to an ALJ under the 
provisions of part 636. This further appeal will not in any way 
interfere with the Department's designation and funding of another 
organization to serve the area in question. The available remedy under 
such an appeal will be the right to be designated in the future rather 
than a retroactive or immediately effective designation status. 
Therefore, in the event the ALJ rules that the organization should have 
been designated and the organization continues to meet the requirements 
at Sec.Sec. 632.10 and 632.11, the Department will designate the 
successful appellant organization and fund within 90 days of the ALJ 
decision unless the end of the 90 day period is within six months of the 
end of the two year designation period. Any organization designated or 
funded for the area in question would be affected by this remedial 
action and undesignated. All parties must agree to this arrangement 
prior to funding. The alternate organization which loses its designation 
as a result of the application of this remedy may not appeal the 
undesignation.
    (b) If the grant officer finally disapproves a CAP pursuant toSec. 
632.21 he/she may withdraw the Native American grantee's designation and 
immediately designate another entity to serve the area, pending the 
final resolution of any Petitions for Reconsideration or other actions 
taken pursuant to part 636.
    (c) If a Native American grantee's CAP is terminated or suspended in 
whole or in part, the Department (after an opportunity for a hearing 
except in emergency situations as described in section 164(f) of the 
Act) may designate another entity to serve the area.
    (d) If it is not feasible for the Department to designate another 
entity to serve the area under the conditions described in paragraphs 
(a), (b), and (c) of this section, the funds involved may be distributed 
at the Secretary's discretion to Native American grantees serving other 
areas.



Sec.  632.13  Review of denial of designation as a Native American 
grantee, or rejection of a Comprehensive Annual Plan.

    (a) An applicant for designation as a Native American grantee which 
is refused such designation in whole or in part may file a Petition for 
Reconsideration with the Grant Officer within 14 days of receipt of a 
letter from the Department indicating its failure to be designated as a 
Native American grantee.
    (1) A Petition for Reconsideration shall be in writing, shall be 
signed by a responsible official of the applicant entity, and shall 
enumerate the factors which the applicant entity asserts should be 
reviewed by the Grant Officer in reconsidering the denial of its 
application.
    (2) Upon receipt of the Petition for Reconsideration, the Grant 
Officer shall, within 30 days, make one of the following determinations:
    (i) That based on the available information from the original 
request for designation and information supplied in the Petition for 
Reconsideration, the applicant entity should be designated as a Native 
American grantee;
    (ii) That the original determination made was correct; or
    (iii) That an informal conference between representatives of the 
applicant entity and the Grant Officer shall be held at a specified time 
and place to discuss the Petition for Reconsideration.
    (3) If an informal conference is held, the applicant entity shall 
have the opportunity to present any pertinent information which may 
further substantiate its petition. The Grant Officer shall notify the 
applicant entity of its final decision within 14 days after the informal 
conference is held.
    (4) All final determinations of the Grant Officer, which deny a 
Petition for Reconsideration, shall be in writing, shall state the 
reasons for the denial, shall be sent to the applicant by

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certified mail, return receipt requested, and shall notify the applicant 
entity that, within 21 days of its receipt of the notice, it may request 
a hearing pursuant to part 636.
    (b) A designated Native American grantee whose CAP has been rejected 
may file a Petition for Reconsideration pursuant to paragraph (a) of 
this section. Such petitions shall be handled under the procedures 
described in paragraph (a) of this section.



   Subpart C_Program Planning, Application and Modification Procedures



Sec.  632.17  Planning process.

    (a) Each Native American grantee shall establish a planning process 
for the development of its Master Plan and Comprehensive Annual Plan. 
This planning process shall involve consideration of the need for job 
training and employment services, appropriate means of providing needed 
services and methods of monitoring and assessing the services provided. 
Recognizing the importance of employer involvement in designing and 
implementing programs, each Native American grantee shall involve 
employers in program planning.
    (b) (1) Each Native American grantee's planning process shall 
involve consultation with major employers or organizations representing 
employers inside the grantee's designated service or surrounding labor 
market area. Such consultation shall include consideration of the 
opportunities for placement of program participants and the design of 
training activities and related services.
    (2) A description of the procedures used for this consultation shall 
be included in the grantee's Master Plan. The results of the 
consultation shall be described in the grantee's Comprehensive Annual 
Plan.
    (3) Native American grantees are encouraged to establish or to use 
existing formal advisory councils, such as Private Industry Councils, as 
vehicles for such consultation. Grantees are also encouraged to use all 
appropriate mechanisms, including Tribal Employment Rights Offices 
(TEROs), to insure maximum opportunity for the placement of participants 
in unsubsidized employment.
    (4) A Native American grantee will not be held responsible for the 
refusal of any employer or organization representing employers to engage 
in the consultation process described in this section.
    (c) In addition to the requirement in paragraph (b) of this section, 
the planning process shall provide the opportunity for the involvement 
of the client community, service providers (such as appropriate 
community-based organizations) and educational agencies, tribal agencies 
or other Indian and Native American organizations whose programs are 
relevant to the provision of job training services within the grantee's 
service area.



Sec.  632.18  Regional and national planning meetings.

    Grant funds may be used for holding regional and national planning 
meetings, subject to restrictions of allowable costs.



Sec.  632.19  Grant application content.

    The basic document will be a four year Master Plan which will be 
supplemented each fiscal year by submission and approval of a 
Comprehensive Annual Plan (CAP). The Master Plan and CAP system will be 
implemented for 1985 or the first designation period following the FY 
1984 designations. Each designated grantee will be informed of and 
provided the necessary documents and requirements in sufficient time to 
complete grant actions without interrupting services to participants.



Sec.  632.20  Submission of grant application.

    (a) Beginning with 1985 or the first designation period after 1984, 
a Master Plan must be submitted by a date and pursuant to instructions 
issued by the Department. The approved Master Plan will remain in effect 
for four years unless terminated. During the fourth year of the Master 
Plan a new Master Plan must be submitted by a date and pursuant to 
instructions issued by the Department.
    (b) Each year a completed CAP is to be submitted for approval by 
registered mail to the Chief, DINAP by a date and

[[Page 283]]

pursuant to instructions announced by the Department. The CAP will be 
approved by DINAP if it is consistent with the basic provisions or the 
Master Plan and applicable regulations and formal directives.



Sec.  632.21  Application disapproval.

    (a) A CAP shall be disapproved by the Grant Officer if it fails to 
meet the requirements of the Act or the regulations.
    (b) No CAP shall be finally disapproved until the designated Native 
American grantee is provided with a description by the Chief, DINAP in 
writing of the CAP's defects and has been provided with at least 30 days 
to remedy such defect(s), but has failed to do so.
    (c) When a CAP is finally disapproved a notice of disapproval shall 
be transmitted by certified mail, return receipt requested, to the 
applicant, accompanied by a statement of the grounds of the disapproval 
and a statement that the applicant may file a Petition for 
Reconsideration with respect to the disapproval.



Sec.  632.22  Modification of a Comprehensive Annual Plan (CAP)
and/or Master Plan.

    (a) The requirements for modifying a Master Plan and/or CAP will be 
included in administrative instructions issued by the Grant Officer upon 
final implementation of the Master Plan/CAP system.
    (b) Prior to implementing the Master Plan/CAP system, a formal 
modification will be required when:
    (1) There is a change of at least 25 percent or $25,000 (whichever 
is greater) in any cost category; or
    (2) There is a change of at least 25 percent or 25 individuals 
(whichever is greater) in the number of individuals to be served in any 
category of program activity.
    (c) The documentation to be submitted to the DINAP Federal 
Representative requesting such a modification shall consist of a letter 
explaining the need for the change and four copies of the proposed 
modification.
    (d) The Grant Officer should notify the Native American grantee of 
tentative approval or disapproval within 10 calendar days of receipt of 
the proposed modifications. The Grant Officer should notify the Native 
American grantee in writing of final approval or disapproval within 30 
calendar days of the receipt of the proposed modification.
    (e) A Native American grantee may make any change in its Program 
Planning Summary and Budget Information Summary without prior approval, 
except as provided in this section.
    (f) Native American grantees shall notify DINAP by submitting a 
modification whenever there is a change in a name, address, or other 
similar information.
    (g) The Department will unilaterally modify a grant when a simple 
funding or performance period increase is required and it is consistent 
with the approved plan.

(Approved by the Office of Management and Budget and assigned OMB 
control number 1205-0213)



Sec.  632.23  Termination and corrective action of a CAP and/or
Master Plan.

    (a) Emergency Termination. The Department may terminate or suspend a 
CAP designation or Master Plan under emergency termination procedures in 
accordance with section 164(f) of the Act. The provisions in part 636 
shall not apply in instances of emergency termination.
    (1) Instances under which emergency termination can occur include 
but are not limited to: Audit reports identifying numerous adverse 
findings in the area of financial control and management; information 
gathered through onsite monitoring which substantiates serious 
management, fiscal and/or performance problems, information from the 
Inspector General or gained through incident reports of poor 
performance, serious administrative problems and/or inability to protect 
and account for Federal funds.
    (2) Within 30 days of written termination notification to a grantee, 
the Department will secure applicable documents onsite, seize bank 
accounts relating to the program, arrange for the payment of legitimate 
bills and debts and arrange, to the degree feasible, for the continued 
provision of services to program enrollees.

[[Page 284]]

    (b) Termination for Cause. Termination for cause can occur whenever 
there is a substantial or persistent violation of the governing rules 
and regulations or failure to comply with the grant terms and 
conditions. The following factors will be considered for termination:
    (1) Poor performance and inability to meet Federal standards related 
to such debt collection requirements as:
    (i) Failure to respond to demand letters from DOL for repayment of 
debts within the stated timeframe;
    (ii) Failure to comply with an approved repayment agreement revealed 
through monitoring or subsequent audit;
    (iii) Failure to take necessary corrective action to improve 
underperformance and to plan for more effective subsequent operations.
    (2) Nonperformance related to such requirements as:
    (i) Failure to submit required quarterly financial reports for two 
successive periods within 45 days after they are due;
    (ii) Failure to submit required quarterly performance reports for 
two successive periods within 45 days after they are due;
    (iii) Failure to develop a plan of action to correct deficiencies 
identified in an audit report or by an onsite monitoring review.
    (3) Nonperformance related to such requirements as:
    (i) Failure to comply with formal corrective action after due 
notice;
    (ii) Failure to comply with the requirements of the Act related to a 
grievance procedure and other requirements;
    (iii) Failure to submit a required modification within 10 days to 
adjust the grant award due to reduction in available funds, reductions 
due to debt collection action, etc.
    (c) In addition, the Department, by written notice, may terminate a 
grant in whole or in part in the event of a reduction in the funds 
available or a change in provisions for JTPA title IV, section 401 
programs by reason of congressional action.



            Subpart D_Administrative Standards and Procedures



Sec.  632.31  General.

    (a) This subpart describes requirements relating to the 
administration of grants by Native American grantees. Administrative 
requirements found in this subpart apply to all programs under the Act 
unless stated to the contrary for any specific program.
    (b) As referenced in this subpart, the requirements set forth in 41 
CFR parts 29-70, ``Administrative requirements governing all grants and 
agreements by which Department of Labor agencies award funds to State 
and local governments, Indian and Native American entities, public and 
private institutions of higher education and hospitals, and other quasi-
public and private nonprofit organizations,'' shall apply to grants 
under JTPA. Whenever the provisions of 41 CFR part 29-70 conflict with 
the provisions of part 632, the provisions of part 632 shall prevail.
    (1) The requirements in 41 CFR 29-70.1 set forth the policies which 
apply to all basic grants and agreements.
    (2) The requirements in 41 CFR 29-70.2 implement OMB Circular Nos. 
A-102 and A-110, and apply to all JTPA grants and agreements unless 
otherwise indicated in these regulations.



Sec.  632.32  Financial management systems.

    (a) Each Native American grantee, subgrantee and contractor shall 
maintain a financial management system which will provide accurate, 
current and complete disclosure of the financial transactions under each 
grant, subgrant or contract activity, and will enable each Native 
American grantee, subgrantee or contractor to evaluate the effectiveness 
of program activities and meet the reporting requirements of this 
subpart.
    (b) Each Native American grantee, subgrantee and contractor shall 
maintain its financial accounts so that the reports required by the 
Department may be prepared therefrom.
    (c) To be acceptable for audit under this subpart, a Financial 
Status Report shall be:
    (1) Current as of the cut-off date of the audit;

[[Page 285]]

    (2) Taken directly from or linked by worksheet to the Native 
American grantee's books of original entry; and
    (3) Traceable to source documentation of the unit transaction.



Sec.  632.33  Audits.

    (a) General. The audit provisions of 41 CFR part 29-70 shall apply 
to Native American grantees. Until unified or single audit procedures 
are promulgated and implemented for nonprofit entities, the Office of 
the Inspector General shall be responsible for arranging and conducting 
audits of Native American grantees that are not Indian tribal 
governments.
    (b) Audit reports. Upon receipt of a final audit report the 
Inspector General will promptly transmit the audit report to the grantee 
for a comment period not to exceed 30 days.
    (c) Initial Determination. After the conclusion of the comment 
period for audits provided the grantee, the Grant Officer shall make an 
initial determination of the allowability of questioned costs or 
activities. Such determination should be based on the Act, regulations 
grants or other agreements under the Act.
    (d) Informal resolution. Except as provided in section 164(f) of the 
Act, the Grant Officer shall not revoke a grant, in whole or in part, 
nor institute corrective action or sanctions against a grantee without 
first providing the grantee with an opportunity to informally resolve 
those matters contained in the Grant Officer's initial determination. If 
the matters are informally resolved the Grant Officer shall notify the 
parties in writing of the nature of the resolution, which shall 
constitute the final determination, and may close the file.
    (e) Final determination. The Grant Officer shall, not later than 180 
days from the time the Inspector General issues the final approved audit 
report, issue a final determination that:
    (1) Indicates that efforts to informally resolve matters contained 
in the initial determination pursuant to paragraph (a) of the section 
have been unsuccessful.
    (2) Lists those matters upon which the parties continue to disagree.
    (3) Lists any modifications to the factual findings and conclusions 
set forth in the initial determination.
    (4) Lists any sanctions, and required corrective actions, including 
any other alteration or modification of the plan, grant, agreement or 
program intended by the Grant Officer.
    (5) Sets forth any appeal rights.



Sec.  632.34  Program income.

    (a) General. The provisions of 41 CFR 29-70.205, program income and 
interest earned, shall apply to Native American grantee programs.
    (b) Income generated under any program may be retained by the 
recipient to continue to carry out the program, notwithstanding the 
expiration of DOL financial assistance for that program.
    (c) Special provisions. Income earned as a result of activities of 
JTPA participants by an income generating enterprise, which is owned by 
an Indian tribe, band or group or an Alaskan native entity, and the 
profits of which are used exclusively for governmental, charitable, 
educational, civic, social or other similar purposes, may be retained by 
such enterprise and used in the same manner as other income of such 
enterprise.



Sec.  632.35  Native American grantee contracts and subgrants.

    (a) Contracts may be entered into between the Native American 
grantee and any party, public or private, for purposes set forth in the 
JTPA.
    (b) Subgrants may be entered into between the Native American 
grantee and units of State and local general government, Indian tribal 
government, public agencies or nonprofit organizations.
    (c) The Native American grantee is responsible for the development, 
approval and operation of all contracts and subgrants and shall require 
that its contractors and subgrantees adhere to the requirements of the 
Act, the regulations under the Act, and other applicable law. It shall 
also require contractors and subgrantees to maintain effective control 
and accountability over all funds, property and other assets covered by 
the contract or subgrant.

[[Page 286]]

    (d) Each Native American grantee shall take action against its 
contractors and subgrantees to prevent or eliminate violations of the 
regulations, and to prevent misuse of JTPA funds.
    (e) Subgrantees are entitled to funding for administrative costs. 
The amount of such funding will be determined during the development of 
subgrants subject to the overall administrative costs of the grant.
    (f) If a contract or subgrant is cancelled in whole or in part, the 
Native American grantee shall develop procedures for ensuring continuity 
of service to affected participants to the extent feasible.
    (g) The Native American grantee may enter into contracts or 
subgrants which extend past the expiration date of the CAP but such 
extension shall not exceed 6 months. In such cases, the grantee shall 
continue to be responsible for the administration of such contracts and 
subgrants.
    (h) To the extent feasible, Native American Indian grantees shall 
give preference in the award of contracts and subgrants to Indian 
organizations and to Indian-owned economic enterprises as defined in 
section 3 of the Indian Financing Act of 1974 (25 U.S.C. 1452). Any 
contract or subgrant made by a Native American grantee shall require 
that, to the greatest extent feasible, preference and opportunities for 
training and employment in connection with such contract or subgrant 
shall be given to qualified Indians regardless of age, religion or sex 
and that the contractor or subgrantee shall comply with any Indian 
preference requirements established by the Native American grantee. All 
grantees, subgrantees and contractors shall include the requirements of 
this paragraph in all subcontracts and subgrants made by them (sec. 7(b) 
of the Indian Self-Determination and Education Assistance Act, Public 
Law 93-638 (25 U.S.C. 450 et seq.)).
    (i) The Native American grantee shall ensure that contractors and 
subgrantees maintain and make available for review by the grantee and 
the Department of Labor all records pertaining to the operations of 
programs under such contracts and subgrants consistent with the 
maintenance and retention of record requirements in 41 CFR parts 29-70.



Sec.  632.36  Procurement standards.

    (a) Native American grantees shall comply with the procurement 
systems and procedures found in 41 CFR 29-70.216, Procurement standards.
    (b) Subject to the Indian preference provisions ofSec. 632.35(h), 
small and minority-owned businesses, including small businesses owned by 
women, within the service area of the Native American grantee, shall be 
provided maximum reasonable opportunity to compete for contracts for 
supplies and services. One means to provide for this is the use of set-
asides.
    (c) No funds shall be paid by the Native American grantee to any 
organization for the conduct of programs under the Act unless:
    (1) It has submitted an acceptable proposal;
    (2) Selection is performed on a merit basis;
    (3) It has not been seriously deficient in its conduct of, or 
participation in, any Department of Labor program in the past, or is not 
a successor organization to one that was seriously deficient in the 
past, unless the organization statisfactorily demonstrates that the 
deficiency has been or will be corrected and performance substantially 
improved; and
    (4) It has the administrative capability to perform effectively.



Sec.  632.37  Allowable costs.

    (a) General. To be allowable, a cost must be necessary and 
reasonable for proper and efficient administration of the grantee's 
program, be allocable thereto under these principles, and, except as 
provided herein, not be a general expense required to carry out the 
overall responsibilities of the grantee. Costs charged to the program 
shall be consistent with those normally allowed in like circumstances 
and, with applicable State and local law, rules or regulations as 
determined by the Native American grantee.
    (b) Unless otherwise indicated below, direct and indirect costs 
shall be charged in accordance with 41 CFR 29-70 and 41 CFR 1-15.7.

[[Page 287]]

    (c) Costs associated with repairs, maintenance, and capital 
improvements of existing facilities used primarily for programs under 
the Act are allowable. Additionally, the costs of home repair, 
weatherization and rehabilitation are allowable when the work is 
performed on low income housing as defined inSec. 632.4.
    (d) Section 401 funds may be used to pay the cost of incorporating a 
PIC, other planning body or consortium administrative entity for the 
purpose of carrying out programs under the Act. These costs are 
chargeable to administration.
    (e) Costs which are billed as a single unit charge do not have to be 
allocated or prorated among the several cost categories but may be 
charged entirely to training when the agreement:
    (1) Is for classroom training;
    (2) Is fixed unit price; and
    (3) Stipulates that full payment for the full unit price will be 
made only upon completion of training by a participant and placement of 
the participant into unsubsidized employment in the occupation trained 
for and at not less than the wage specified in the agreement.



Sec.  632.38  Classification of costs.

    Allowable costs shall be charged against the following four cost 
categories: Administration; training, employment and other (including 
supportive services).
    (a) Costs are allocable to a particular cost category to the extent 
that benefits are received by such category.
    (b) The Native American grantee is required to plan, control and 
charge expenditures against the aforementioned cost categories.
    (c) The Native American grantee is responsible for ensuring that, at 
a minimum, subgrant or subcontract recipients plan, control, and charge 
expenditures against the aforementioned cost categories.
    (d) Administrative costs consist of all direct and indirect costs 
associated with the management of the grantee's program. These costs 
include but are not limited to: the salaries and fringe benefits of 
personnel engaged in executive, fiscal, data collection, personnel, 
legal, audit, procurement, data processing, communications, maintenance, 
and similar functions; and related materials, supplies, equipment, 
office space costs, and staff training. Also included are salaries and 
fringe benefits of direct program administrative positions such as 
supervisors, program analysts, labor market analysts, and project 
directors. Additionally, all costs of clerical personnel, materials, 
supplies, equipment, space, utilities, and travel which are identifiable 
with these program administration positions are charged to 
administration.
    (e) Training costs consist of goods and services which directly 
affect program participants in a training activity. Training costs 
include, but are not limited to, the following: the costs associated 
with on-the-job training, salaries, fringe benefits, equipment and 
supplies of personnel engaged in providing training; books and other 
teaching aids; equipment and materials used in providing training to 
participants; classroom space and utility costs; employability 
assessment; job related counseling for participants; job search 
assistance and labor market orientation; participant allowances, and 
tuition and entrance fees which represent instructional costs which have 
a direct and immediate impact on participants. In addition, 250 hours of 
youth try-out employment is considered an allowable training cost. Youth 
try-out employment is that which meets the requirements ofSec. 632.78.
    (f) The compensation of individuals who both instruct participants 
and supervise other instructors must be prorated among the training and 
administration cost categories on the basis of time records or other 
equitable means. Similarly, tuition fees, and the costs of supplies used 
in the course of both participant instruction and other activities 
should be prorated among the benefitting uses.
    (g) Employment costs consist of those costs associated with 
community service employment and work experience as described inSec. 
632.79.
    (h) Other costs include supportive services, services which are 
necessary to enable an individual to participate in training and 
assistance under this part, and those described inSec. 632.80.

[[Page 288]]

    (i) Costs which are not readily assignable to the training or 
employment cost category should be charged to either the administration 
or other category as appropriate.
    (j) Unemployment compensation costs are allowable for administrative 
staff hired in accordance with the administrative provisions of this 
part, and for CSE participants. Unemployment compensation costs are 
allowed for work experience only where required by State law.
    (k) Travel costs. (1) The cost of participant travel and staff 
travel necessary for the administration of programs under the Act are 
allowable costs, chargeable to the proper cost category, and must follow 
standard Federal travel requirements.
    (2) Travel costs of Native American grantee officials, including 
staff, board members, and advisory council members are allowable if the 
travel and costs specifically relate to programs under the Act. These 
costs will be charged to administration. Travel costs for officials of 
tribes or organizations belonging to a consortium require advance 
written approval from the Chief, DINAP, unless they are also officials 
of the Native American grantee organization.
    (3) Travel costs for participants using their personal vehicles in 
the performance of their jobs are allowable if the employing agency 
normally reimburses its other employees in this way. These costs shall 
be charged to supportive services.
    (4) Travel costs to enable participants to obtain employment or to 
participate in programs under the Act are allowable as supportive 
services.
    (l) Allocation of fixed unit charge. (1) When contractors or 
subgrantees bill the Native American grantee with a single unit charge 
containing costs which are chargeable to more than one cost category, 
the Native American grantee shall charge these costs to the cost 
categories inSec. 632.38. For unit charges such as tuition fees for 
which the necessary detail cannot be provided, a reasonable estimate of 
the breakdown of the single unit charge among cost categories inSec. 
632.38 will be sufficient, including for audit purposes. When such unit 
charges are normally billed as a single charge and the cumulative amount 
of such charges to a service provider does not exceed $25,000 within the 
grant year, proration will not be required. These costs may be charged 
to the category receiving the most benefit.
    (2) The provisions of this section shall not apply to vendors 
selling or leasing equipment and attendant service at a commercially 
established rate to Native American grantees or subgrantees.
    (3) In the case of multiuse equipment there must be a proration of 
costs or, if there is a predominant usage relating to one cost category, 
a charge shall be made to that category.
    (4) Any single cost, such as staff salaries or fringe benefits, 
which is properly chargeable to more than one cost category shall be 
prorated among the affected categories.



Sec.  632.39  Administrative cost plan.

    (a) All administrative funds for all programs operated under 
separate sections of the Act by a Native American grantee may be 
accounted for separately and be allocated by title and program activity 
or may be pooled into one fund. Planned expenditures from the fund shall 
be described in a separate section of the CAP.
    (b) The administrative cost plan may be modified during the program 
year.



Sec.  632.40  Administrative staff and personnel standards.

    (a) Staffing. Members of the population to be served shall be 
provided maximum employment opportunities at all levels of the JTPA 
grantee administration. Native American grantees shall establish systems 
to enhance the recruitment and hiring of qualified Indian and Native 
Americans and to provide opportunities for their further occupational 
training and career advancement.
    (b) Compensation. Compensation for administrative staff shall be at 
levels consistent with generally accepted business practices in the 
area. Such administrative wages, salaries, and fringe benefits are 
allowable administrative costs under JTPA.

[[Page 289]]

    (c) Basic personnel standards. All grantee employees, including 
participants, engaged in the administration of programs under the Act 
shall be subject to the policies and methods of personnel administration 
as formally established by the Native American grantee.
    (d) Bonding. Native American grantees shall comply with the bonding 
requirements at 41 CFR 29-70.202b.



Sec.  632.41  Reporting requirements.

    Within 45 days of the end of each quarter, a Native American grantee 
shall submit to the Chief, DINAP by registered mail, financial and 
program reports. Accuracy of all reports must be verified by the chief 
executive officer or financial officer. When estimates are used the 
verification statement will so state. The exact reports to be submitted 
and reporting instructions as approved by the Office of Management and 
Budget will be announced to Native American grantees under separate 
order.



Sec.  632.42  Grant closeout procedures.

    Grant closeout will conform to the requirements at 41 CFR part 29-
70. As necessary, the Secretary shall issue supplementary closeout 
requirements.



Sec.  632.43  Reallocation of funds.

    When the DINAP determines that reallocation is appropriate, it shall 
give the Native American grantee 30-day notice of proposed action to 
remove funds from the grant. Such notice shall include specific reasons 
for the action being taken, and shall give the Native American grantee 
the opportunity to submit comments on the proposed reallocation of 
funds. These comments shall be submitted to DINAP within 30 days from 
the date of the notice. DINAP shall notify affected Native American 
grantees on any decision to reallocate funds. The Grant Officer shall 
finally reallocate by modifying the CAP.



Sec.  632.44  Sanctions for violation of the Act.

    (a) Pursuant to sections 164 (d), (e), (f), (g), and (h) of the Act, 
the Secretary may impose appropriate sanctions and corrective actions 
for violations of the Act, Regulations, or grant terms and conditions. 
Additionally, sanctions may include the following:
    (1) Offsetting debts, arising from misexpenditure of grant funds, 
against amounts to which the grantee is or may be entitled under the 
Act, except as provided in section 164(e)(1) of the Act. The debt shall 
be fully satisfied when the Secretary reduces amounts allotted to the 
grantee by the amount of the misexpenditure; and
    (2) Determining the amount of Federal cash maintained by the grantee 
or its subgrantee or contract or in excess of reasonable grant needs, 
establishing a debt for the amount of such excessive cash, and charging 
interest on that debt.
    (b) Except for actions under section 164(f) and 167 of the Act, to 
establish a debt or violation subject to sanction and/or corrective 
action, the Secretary shall utilize initial and final determination 
procedures outlined in part 636.
    (c) To impose a sanction or corrective action regarding a violation 
of section 167 of the Act, the Secretary shall utilize the procedures of 
29 CFR part 31.
    (d) (1) The Secretary shall hold the grantee responsible for all 
funds under the grant. The grantee shall hold its subgrantees and 
contractors responsible for JTPA funds received through the grant.
    (2) The Secretary shall determine the liability of the grantee for 
misexpenditures of grant funds in accordance with section 164(e) of the 
Act, including the requirement that the grantee shall have taken prompt 
and appropriate corrective actions for misexpenditures by a subgrantee 
or contractor.
    (3) Prompt, appropriate, and aggressive debt collection action to 
recover any funds misspent by subgrantees or contractors ordinarily 
shall be considered a part of the corrective action required by section 
164(e)(2)(D) of the Act.
    (4) In making the determination required by section 164(e)(2) of the 
Act, the Secretary may determine, based on a request from the grantee, 
that the grantee may forego certain collection

[[Page 290]]

actions against a subgrantee or contractor where that subgrantee or 
contractor was not at fault with respect to the liability criteria set 
forth in section 164(e)(2)(A) through section 164(e)(2)(D) of the Act. 
The Secretary shall consider such requests in assessing whether the 
grantee's corrective action was appropriate in light of section 
164(e)(2)(D) of the Act.
    (5) The grantee shall not be released from liability for misspent 
funds under the determination required by section 164(e) of the Act 
until the Secretary determines that further collection action, either by 
the grantee or subgrantee or contractor, would be inappropriate or would 
prove futile.
    (e) Nothing in this section shall preclude the Secretary from 
imposing a sanction directly against a subgrantee or contractor as 
authorized in section 164(e)(3) of the Act. In such a case, the 
Secretary shall inform the grantee of the Secretary's action.



                 Subpart E_Program Design and Management



Sec.  632.70  Waiver of regulations under Parts 632 and 636.

    (a) A Native American section 401 grantee may request, and the 
Assistant Secretary of Labor for Employment and Training may grant, a 
waiver of specific provisions of 20 CFR Parts 632 and 636, or of any 
applicable administrative issuance, to the extent that such request is 
consistent with the provision of the Act.
    (b)(1) In requesting a waiver under this section, the Native 
American section 401 grantee shall demonstrate how it will enhance the 
provision of services or outcomes to participants, which may include, 
but are not limited to, the following purposes: improving the targeting 
of services to the hard-to-serve; increasing the level of basic and 
occupational skills training provided by the JTPA program; contributing 
to the provisions of academic enrichment services to youth; promoting 
coordination of JTPA programs with other human resources programs; or 
substantially improving the job placement outcomes of the JTPA program.
    (2) The request shall describe the regulatory requirements to be 
waived and demonstrate how such requirements impede the enhancement of 
the services and outcomes described in paragraph (b)(1) of this section.
    (3) The waiver request shall indicate how the grantee will modify 
its planning documents as a result of the waiver.
    (c) A waiver shall not be granted for:
    (1) Any statutory requirement;
    (2) The formula for allocation of funds;
    (3) Eligibility requirements for services as provided in this part;
    (4) Requirements for public health or safety, labor standards, civil 
rights, occupational safety or health, or environmental protection; or
    (5) Prohibitions or restrictions relating to construction of 
buildings or facilities.
    (d) Waivers granted shall be effective for no more than four years 
from the date the waiver is granted.

[60 FR 58229, Nov. 27, 1995]



Sec.  632.75  General responsibilities of Native American grantees.

    This subpart sets out program operation requirements for Native 
American grantees including program management, linkages, coordination 
and consultation, allowable activities, participant benefits and 
duration of participation provisions. It also sets forth the 
responsibilities of Native American grantees with respect to 
nondiscrimination and equitable provision of services.



Sec.  632.76  Program management systems.

    (a) All Native American grantees shall establish management 
information systems to control and assess all programs. Native American 
grantees must institute and maintain effective systems for the overall 
management of all programs including:
    (1) Eligibility verification systems as described inSec. 632.77;
    (2) Complaint and hearing procedures as described in part 636; and
    (3) Mechanisms for taking immediate corrective action where problems 
have been identified and for restitution of JTPA funds for improper 
expenditures.
    (b) All Native American grantees shall establish and maintain 
financial

[[Page 291]]

management and participant tracking systems in accordance withSec. 
632.32 andSec. 632.77. The principal objectives of such systems shall 
be to provide the Native American grantee with systems necessary to 
effectively manage its program and to provide information necessary to 
design program activities and delivery mechanisms and complete Federal 
required reports.
    (c) Each Native American grantee shall establish and use procedures 
for the continuous, systematic assessment of program performance in 
relation to the performance standards and goals contained in its CAP.
    (d) Native American grantees shall establish and use procedures 
whereby the information collected and assessments conducted shall be 
considered in subsequent program planning and in the selection of 
service deliverers.



Sec.  632.77  Participant eligibility determination.

    (a) Each Native American grantee, and any subgrantees or contractors 
assigned responsibility for the determination of participant 
eligibility, shall be responsible for developing and maintaining a 
system which reasonably ensures an accurate determination and subsequent 
verification of eligibility based on the information presented at the 
time of application.
    (b) The ultimate responsibility for the selection of participants 
and the maintenance of participant records rests with the Native 
American grantee. However, the Native American grantee may assign the 
administration of this responsibility to subgrantees of contractors. The 
selected agency must provide adequate documentation of each 
participant's eligibility and retain in the participant's folder the 
information on which this determination is based.
    (c) The eligibility determination shall be based upon a signed, 
completed, application form which records all information necessary to 
determine eligibility, which attests that the information on the 
application is true to the best of the applicant's knowledge and 
acknowledging that such information is subject to verification and that 
falsification of the application shall be grounds for the participant's 
termination and may subject the applicant to prosecution under law. In 
the case of an applicant who is a minor (except minors who are 
emancipated or heads of households), the signature of the parent, 
responsibile adult or guardian is also required.
    (d) Native American grantees shall maintain documentation to ensure 
the credibility of the eligibility determination, which shall at a 
minimum:
    (1) Include a completed application for participation;
    (2) Include records of all actions taken to correct deficiencies in 
the eligibility determination procedures; and
    (3) Show compliance with section 504 of the Act.
    (e) A participant determined to be ineligible shall immediately be 
terminated.
    (f) A Native American grantee may enter into an agreement with a 
State employment security agency (SESA) or other independent agency or 
organization as may be approved by the Department, for the verification 
of applicant eligibility within 45 days of enrollment. The Native 
American grantee shall monitor such verification procedures to ensure 
that erroneous verifications are not made deliberately or with 
insufficient care.
    (g) Participants may be transferred from one JTPA program to 
another, from one Native American grantee to another, from a Native 
American grantee to a SDA grant recipient, from a SDA grant recipient to 
a Native American grantee, or concurrently enrolled in programs 
sponsored by Native American grantees or SDA grant recipients, provided, 
except for age requirements, they were eligible for the subsequent or 
concurrent program when they were first enrolled.
    (h) Eligibility determinations for each program shall be made at the 
time of application. Applicants determined eligible may be enrolled as 
participants within 45 days of the date of the application without an 
update of the information on the application provided they did not 
obtain full-time permanent unsubsidized employment in the interim. This 
provision does not appy to the title II-B program.
    (i) Aliens described in section 167(a)(5) of the Act and who 
otherwise

[[Page 292]]

meet the eligibility requirements for programs under this part, may 
participate in a program if this is permitted by Indian law or the 
Native American grantee.



Sec.  632.78  Training activities.

    Native American grantees shall design and operate programs funded 
under the Act which support growth and development as determined by 
representatives of the Indian and Native American communities and groups 
served (sec. 401(a)). Training shall be only for occupations for which 
there is a demand in the area served or in another area to which the 
participant is willing to relocate, and consideration in the selection 
of training programs may be given to training in occupations determined 
to be in sectors of the economy which have a potential for sustained 
demand or growth. The CAP will provide evidence based on local labor 
market information that occupational demand exists for planned training. 
The basic types of training activities available to Native American 
grantees, subgrantees and contractors include, but are not limited, to 
the following:
    (a) Classroom training. This program activity is any training of the 
type normally conducted in an institutional setting, including 
vocational education, and designed to provide individuals with the 
technical skills and information required to perform a specific job or 
group of jobs. It may be coupled with other employment and training 
activities and may also include training designed to enhance the 
employability of individuals by upgrading basic skills, through the 
provision of courses such as remedial education, GED, training in the 
primary language of persons with limited English-speaking proficiency, 
or English-as-a-second-language training.
    (b) On-the-job training. (1) On-the-job training (OJT) is training 
in the private or public sector given to a participant, who has been 
hired first by the employer, and which occurs while the participant is 
engaged in productive work which provides knowledge or skills essential 
to the full and adequate performance of the job. This does not preclude 
a participant who has been hired by and received OJT from one employer 
from being ultimately placed with another employer. Innovative 
approaches to financing, particularly involving the sharing of training 
costs by the private sector are to be encouraged.
    (2) OJT may be coupled with other JTPA employment and training 
activities. As needed, OJT participants may receive any of the 
employment and training services or supportive services through the 
system, through community resources, or through employer resources.
    (3) Reimbursement. Payments to employers for OJT which shall not, 
during the period of such training, average more than 50 percent of the 
wages excluding fringe benefits paid by the employer to such 
participants, and payments in such amount shall be deemed to be in 
compensation for the extraordinary costs associated with the training 
costs and lower productivity of such participants. No direct wage 
payments will be made to OJT participants by the Native American 
Grantee.
    (4) OJT agreements. Employers will be held responsible with respect 
to JTPA costs only in accordance with the provisions of their OJT 
agreements. At a minimum, the OJT agreement shall contain the elements 
listed below. Native American grantees may place additional provisions 
in the OJT agreement only after a careful assessment is made of the 
additional burdens imposed on participating employers. Agreements may be 
entered into only with employers which have not been seriously deficient 
in their conduct of or participation in any DOL program. Each OJT 
agreement shall contain:
    (i) A brief training outline, including the length of training and 
the nature of the training;
    (ii) The method and maximum amount of reimbursement for OJT training 
costs;
    (iii) The number of participants to be trained;
    (iv) Job descriptions and specification of participant wage rates;
    (v) Reporting requirements;
    (vi) An assurance that payroll records, time and attendance records,

[[Page 293]]

job duties and documentation of classroom training, employment and 
training services, or supportive services, costs for which the employer 
is being reimbursed will be subject to review;
    (vii) A termination clause for nonperformance; and
    (viii) An assurance that the employer will comply with the Act and 
regulations.
    (c) Tryout employment. Tryout employment in private-for-profit 
worksites may be conducted in accordance with section 205(d)(3)(B) of 
the Act (sec. 141(K)).
    (d) Training assistance. Such assistance includes:
    (1) Orientation to the world of work;
    (2) Counseling. This includes employment and training related 
counseling and testing;
    (3) Job development;
    (4) Job search assistance. This includes transition services, such 
as job seeking skills instruction, individualized job search plan, labor 
market information, and other special activities for transition to 
unsubsidized employment;
    (5) Job referral and placement; and
    (6) Vocational Exploration Program (VEP). A Native American grantee 
may conduct a VEP program to expose participants to jobs available in 
the private sector through observation of such jobs, instruction, and, 
if appropriate, limited practical experience.
    (e) Combined activities. (1) A participant may be simultaneously or 
sequentially enrolled in two or more activities.
    (2)(i) Reimbursement may be up to 100 percent to employers, 
including private-for-profit employers, for expenditures for the costs 
of classroom training, employment and training assistance or supportive 
services for participants in combined activities including the costs of 
participants' wages paid by the employer for time spent in these 
activities during working hours.
    (ii) Reimbursement may be made on a cost reimbursement or fixed cost 
basis and shall be supported by business receipts, payroll, or other 
records normally kept by the employer.
    (iii) Nothing in this paragraph (b)(1) shall allow reimbursement to 
private-for-profit employers for the costs of OJT to exceed the amounts 
allowable inSec. 632.78.



Sec.  632.79  Employment activities.

    (a) Community service employment (CSE). Community Service Employment 
is the type of work normally provided by government and includes, but is 
not limited to, work (including part-time work) in such fields as 
environmental quality, child care, health care, education, crime 
prevention and control, prisoner rehabilitation, transportation, 
recreation, maintenance of parks, streets and other public facilities, 
solid waste removal, pollution control, housing and neighborhood 
improvement, rural development, conservation, beautification, veterans 
outreach, development of alternative energy technologies, and other 
fields of human betterment and community improvement. It includes work 
performed by tribally sponsored or owned income generating enterprises 
owned by Indian tribes, bands, or groups, or Native Alaskan entities, 
provided the profits from such enterprises are used exclusively for 
functions normally performed by the governing body of such entities.
    (b) Work experience. (1) Work experience is a short-term or part-
time work assignment with an employing agency or an organization 
authorized to employ CSE participants. It is otherwise prohibited in the 
private-for-profit sector.
    (2) Participation in work experience shall be for a reasonable 
length of time, based on the needs of the participant, and subject to 
the restrictions set forth inSec. 632.85.



Sec.  632.80  Other activities.

    (a) General. Native American grantees may conduct employment and 
training activities not described in this subpart. The CAP shall 
describe the basic design of activities undertaken as ``other 
activities'' and their objectives. These activities may include, but are 
not limited to:
    (1) Removal of artificial barriers to employment;
    (2) Job restructuring;
    (3) Revision or establishment of merit systems;

[[Page 294]]

    (4) Development and implementation of affirmative action plans, 
including Indian preference plans and Tribal Employment Rights Office 
(TERO) programs.
    (5) Post termination services inSec. 632.80 for up to 30 days 
following termination; and
    (6) Employment generating services.
    (b) Supportive services. Supportive services are those which are 
necessary to enable an individual eligible under this part, but who 
cannot afford to pay for such services, participate in the program. Such 
supportive services may include but are not limited to transportation, 
health care, special services and materials for the handicapped, child 
care, meals, temporary shelter, financial counseling, and other 
reasonable expenses required for participation in the training program 
and may be provided in-kind or through cash assistance.



Sec.  632.81  Payments to participants.

    (a) General. Each participant paid wages for employment activities, 
allowances for classroom training or reimbursed for OJT or tryout 
employment will be provided such benefits pursuant to section 142 of the 
Act.
    (b) Maximum wage rates for CSE. (1) The wages (including those 
received from overtime work and leave taken during the period of 
employment) paid to any CSE participant from funds under the Act shall 
be limited to a full-time rate of $10,000 per year (or the hourly, 
weekly, or monthly rate which, if full-time and annualized, would equal 
a rate of $10,000 per year). Approved rates above $10,000 are fixed at 
the CETA approved rate as of September 30, 1982, unless adjusted by the 
Secretary.
    (2) Fringe benefits payable from funds under the Act to any CSE 
participant may not exceed those regularly afforded to similarly 
employed non-JTPA workers.
    (3) Davis-Bacon wages. All laborers and mechanics employed by 
contractors or subcontractors in any construction, alteration, or 
repair, including painting and decorating, of projects, buildings, and 
works which are federally assisted under this Act, shall be paid wages 
at rates not less than those prevailing on similar construction in the 
locality as determined by the Secretary in accordnace with the Act of 
March 3, 1931, popularly known as the Davis-Bacon Act, and the 
implementing regulations in 29 CFR parts 1, 3, 5, and 7.
    (c) Payment of allowances. (1) A basic hourly allowance for 
regularly enrolled classroom training or services participants shall not 
exceed the higher of the State or Federal minimum hourly wage.
    (2) Native American grantees are encouraged to submit allowance 
payment designs which are less than in paragraph (c) (1) of this 
section. Through innovative reimbursement systems the number of 
participants should be maximized. The allowance payment system will be 
described in the Master Plan and as an option may include dependent 
allowances.
    (3) Repayments. Native American grantees shall require participants 
to repay the amount of any overpayment of allowances under this part, 
except if the overpayment was made in the absence of fault on the part 
of the participant. Where the Native American grantee requires 
repayment, any overpayment not repaid may be set off against any future 
allowance or other payments under the Act to which the participant may 
become entitled.
    (d) Combined activities. A primary activity is one in which a 
participant is enrolled for more than 50 percent of scheduled time. 
Participants enrolled in a primary activity for which wages are payable 
and simultaneously in an activity for which allowances are payable may, 
at the Native American grantee's option, be paid wages for all hours of 
participation. A participant enrolled in a primary activity for which 
allowances are payable may, at the Native American grantee's option, be 
paid allowances for all hours of participation, except when OJT is the 
non-primary component. However, in the latter case, before placing an 
individual in such an activity, the Native American grantee shall 
request a determination from the Internal Revenue Service as to whether 
income from the non-primary component is taxable.

[[Page 295]]



Sec.  632.82  Benefits and working conditions for participants.

    The provisions of sections 142 and 143 of the Act shall apply to 
benefits and working conditions.



Sec.  632.83  FICA.

    Expenditures may be made from JTPA funds for taxes under the Federal 
Insurance Contribution Act (FICA), 26 U.S.C. 3101, et seq.



Sec.  632.84  Non-Federal status of participants.

    Participants shall not be deemed Federal employees and shall not be 
subject to the provisions of law relating to Federal employment.



Sec.  632.85  Participant limitations.

    (a) Except as provided in paragraph (c) of this section and for 
participants in programs that have other statutory limits, participation 
in work experience shall be limited to a maximum of 1,000 hours during 
any one year beginning with the day of enrollment in either CETA or 
JTPA.
    (b) No participant may receive wages for CSE for more than 78 weeks 
during a 2-year period from the participant's initial enrollment in 
either JTPA or in a program supported by the Comprehensive Employment 
and Training Act.
    (c) The limitation on work experience participation in JTPA set 
forth in paragraph (a) of this section:
    (1) Shall not apply to time spent by in-school youth or title II-B 
participants enrolled in a work experience program under the Act, nor 
shall such time be included in determining if an individual has reached 
such limitations; and
    (2) May be waived by the Chief, DINAP and the waiver justification 
described in the Master Plan or CAP.



Sec.  632.86  Nondiscrimination and nonsectarian activities.

    Pursuant to section 167(a) of the Act:
    (a) Subject to the restriction that services under section 401 of 
JTPA are legally available only to Indian and Native American persons, 
nondiscrimination and equal opportunity requirements and procedures, 
including complaint processing compliance reviews, will be governed by 
the provisions of 29 CFR parts 31 and 32 and will be administered by the 
Office of Civil Rights.
    (b) The employment or training of participants in sectarian 
activities is prohibited.



Sec.  632.87  Equitable provision of services to the eligible 
population and significant segments.

    Native American grantees shall ensure and provide evidence in the 
Master Plan that a system is in place to afford all members of the 
eligible population within the service area for which the grantee was 
designated are afforded an equitable opportunity for employment and 
training activities and services.



Sec.  632.88  General responsibilities of the Department.

    The Department of Labor shall be responsible for:
    (a) Providing prompt notification to all Native American grantees of 
allocations of funds, proposed and final rules and program directives 
and procedures.
    (b) The development, after consultation with Native American 
grantees, of regulations, performance standards and program policies 
governing Native American programs. Such regulations and program 
policies shall take into account the special circumstances under which 
Native American programs operate (sec. 401 (h)(1)).
    (c) Providing Native American grantees with technical assistance, as 
the Secretary deems necessary, related to the administration and 
operation of JTPA programs (sec. 401(i)).
    (d) Taking appropriate action to establish administrative procedures 
and machinery within the Department, including the retention of 
personnel having particular competence in the field of Indian and Native 
American employment and training programs, for the selection, 
administration, monitoring and evaluation of such programs (sec. 
401(e)).



Sec.  632.89  Performance standards.

    The Department of Labor shall establish performance standards for 
all Native American grantees (section 401(h)(1)). Performance results, 
as

[[Page 296]]

judged against these standards, will not be used for grantee designation 
purposes for the Program Years 1985-1986. Performance results will be a 
factor in grantee designations for Program Years 1987-1988, and beyond.



             Subpart F_Prevention of Fraud and Program Abuse



Sec.  632.115  General.

    (a) To ensure the integrity of the JTPA programs special efforts by 
grantees are necessary to prevent fraud and other program abuses. While 
any violation of the Act or regulations may constitute fraud or program 
abuse, this subpart F identifies and addresses those specific program 
problems of most concern to the Department.
    (b) This subpart sets forth specific responsibilities of Native 
American grantees, subgrantees and contractors and of the Secretary to 
prevent fraud and program abuse in JTPA programs.



Sec.  632.116  Conflict of interest.

    (a) No member of any advisory, planning, private industry council or 
governing body under the Act shall cast a vote on any matter which has a 
direct bearing on services to be provided by that member or any 
organization which such member directly represents or on any matter 
which would financially benefit such member or any organization such 
member represents.
    (b) Each Native American grantee, subgrantee or contractor shall 
avoid personal and organizational conflict of interest in awarding 
financial assistance and in the conduct of procurement activities 
involving funds under the Act in accordance with the code of conduct 
requirements set forth in 41 CFR 29-70.216-4.
    (c) Neither the Secretary nor any Native American grantee, 
subgrantee or contractor shall pay funds under the Act to any 
nongovernmental individual, institution or organization to conduct an 
evaluation of any program under the Act if such individual, institution 
or organization is associated with that program as a consultant or 
technical advisor.



Sec.  632.117  Kickbacks.

    No officer, employee or agent of any Native American grantee, 
subgrantee of contractor shall solicit or accept gratuities, favors or 
anything of monetary value from any actual or potential subgrantee, 
contractor or supplier.



Sec.  632.118  Nepotism.

    (a) No Native American grantee, subgrantee, contractor or employing 
agency shall permit the hiring of any person in a staff position or as a 
participant if that person or a member of that person's immediate family 
is employed in an administrative capacity by the Native American 
grantee, subgrantee or contractor. The Native American grantee may waive 
this requirement if adequate justification is documented. The following 
are examples where the nepotism provision may be waived:
    (1) If there are no other persons eligible and available for 
participation or employment by the Native American grantee;
    (2) Where the Native American grantee's total service population is 
2,000 or less, or where the geographical situation of an Indian or 
Native American community is rural and isolated from other communities 
within the designated service area; or
    (3) Where the potential participant has a history of unemployment or 
dependence on public assistance.
    (b) A Native American grantee may develop its own nepotism policy in 
lieu of the policy in paragraph (a) of this section. The Chief, DINAP, 
shall review any such policy before its implementation and shall approve 
or disapprove it. Any such policy shall be described in the Master Plan 
and have adequate safeguards to prevent persons employed in an 
administrative capacity for the Native American grantee, its subgrantees 
or contractors from using such position to secure JTPA services or other 
benefits for a member of his or her immediate family. A satisfactory 
policy shall include the following minimum criteria:
    (1) All formal personnel procedures shall be followed;
    (2) There shall be full written disclosure to the governing body 
describing

[[Page 297]]

all advantages, conflicts and/or disadvantages which may result from the 
specific personnel action; and
    (3) No member of the immediate family of the applicant shall 
participate in the applicant's selection.
    (c) For purposes of this section, the term ``immediate family'' 
means wife, husband, son, daughter, mother, father, brother, and sister. 
The term ``staff position'' includes all JTPA staff positions funded 
under the Act such as instructors, counselors, and other staff involved 
in administrative, training or service activities. The term ``employed 
in an administrative capacity'' includes those persons who have overall 
administrative responsibility for a program including: All elected and 
appointed officials who have any responsibility for the obtaining of or 
approval of any grant funded under this part as well as other officials 
who have any influence or control over the administration of the 
program, such as the project director, deputy director and unit chiefs; 
and persons who have selection, hiring, placement or supervisory 
responsibilities for participants in a Native American employment and 
training program. The term excludes officials of entities belonging to a 
consortium who are not at the same time officials of the consortium. 
Persons serving on a Native American grantee's advisory councils or PIC 
shall not be considered to be in an administrative capacity.



Sec.  632.119  Political patronage.

    (a) No Native American grantee, subgrantee or contractor may select, 
reject, or promote a participant based on that individual's political 
affiliation or beliefs. The selection or advance of employees as a 
reward for political services or as a form of political patronage, 
whether or not the political service or patronage is partisan in nature, 
is prohibited.
    (b) There shall be no selection of subgrantees or contractors based 
on political affiliation.



Sec.  632.120  Political activities.

    (a) No program under the Act may involve political activities.
    (b) No participant may engage in partisan or nonpartisan political 
activities during hours for which the participant is paid with JTPA 
funds.
    (c) No participant may, at any time, engage in partisan or 
nonpartisan political activities in which such participant represents 
himself or herself as a spokesperson for the JTPA program.



Sec.  632.121  Lobbying activities.

    No funds provided under the Act may be used in any way:
    (a) To attempt to influence in any manner a member of Congress to 
favor or oppose any legislative or appropriation by Congress; or
    (b) To attempt to influence in any manner State or local legislators 
to favor or oppose any legislation or appropriation by such legislators.



Sec.  632.122  Unionization and antiunionization activities;
work stoppages.

    (a) No funds under the Act shall be used in any way to either 
promote or oppose unionization (sec. 143(c)(1)).
    (b) No participant in work experience or community service 
employment may be placed into, or remain working in, any position which 
is affected by labor disputes involving a work stoppage. If such a work 
stoppage occurs during the grant period, participants in affected 
positions must:
    (1) Be relocated to positions not affected by the dispute; or
    (2) Be suspended through administrative leave or other means; or
    (3) Where participants belong to the labor union involved in the 
work stoppage, they shall be treated in the same manner as other members 
of the union except that they may not remain in the affected positions. 
The grantee shall make every effort to relocate participants who wish to 
remain working into suitable positions unaffected by the work stoppage.
    (c) No person shall be referred to or placed in an on-the-job 
training position affected by a labor dispute involving a work stoppage 
and no payments may be made to employers for the training and employment 
of participants in on-the-job training during the periods of work 
stoppage.

[[Page 298]]



Sec.  632.123  Maintenance of effort.

    (a) Funds provided under this Act shall only be used for activities 
which are in addition to those which would otherwise be available in the 
area in the absence of such funds.
    (b) Funds provided under this Act shall not be used to duplicate 
facilities or services available in the area (with or without 
reimbursement) from Federal, State, or local sources, unless the plan 
establishes that alternative services or facilities would be more 
effective or more likely to achieve performance goals.



Sec.  632.124  Theft or embezzlement from employment and training 
funds; improper inducement; obstruction of investigations and other
criminal provisions.

    The criminal provision of 18 U.S.C. 665 states:
    (a) Whoever, being an officer, director, agent or employee of, or 
connected in any capacity with, any agency receiving financial 
assistance under the JTPA knowingly hires an ineligible individual or 
individuals; embezzles, willfully misapplies, steals, or obtains by 
fraud any of the money, funds, assets, or property which are the subject 
of a grant or contract of assistance pursuant to such Act shall be fined 
not more than $10,000 or imprisoned for not more than 2 years, or both; 
but if the amount so embezzled, misapplied, stolen, or obtained by fraud 
does not exceed $100, such person shall be fined not more than $1,000 or 
imprisoned not more than 1 year, or both.
    (b) Any person whoever willfully obstructs or impedes, or endeavors 
to obstruct or impede, an investigation or inquiry under the JTPA or the 
regulations thereunder, shall be punished by a fine of not more than 
$5,000 or by imprisonment for not more than 1 year, or by both such fine 
and imprisonment.
    (c) In addition to the criminal provisions set forth in paragraphs 
(a) and (b) of this section, individuals may be held criminally liable 
under other Federal laws. For example, 18 U.S.C. sections 600 and 601 
hold them liable if they:
    (1) Directly or indirectly promise any employment position, 
compensation, contract, appointment, or other benefit, provided for or 
made possible in whole or in part by funds under the Act, or any special 
consideration in obtaining any such benefit, to any person as 
consideration, favor, or regard for any political activity or for the 
support of, or opposition to, any candidate or any political party in 
connection with any general or special election to any political office, 
or in connection with any primary election or political convention or 
caucus held to select candidates for any political office (18 U.S.C. 
600); or
    (2) Directly or indirectly knowingly cause or attempt to cause any 
person to make a contribution of a thing of value (including services) 
for the benefit of any candidate or any political party, by means of the 
denial or deprivation, or the threat of the denial or deprivation, of 
any employment or benefits funded under the Act (18 U.S.C. 601).



Sec.  632.125  Responsibilities of Native American grantees,
subgrantees and contractors for preventing fraud and program abuse and
for general program management.

    (a) Each Native American grantee shall establish and use internal 
program management procedures sufficient to prevent fraud and program 
abuse, including subgrantee and contractor fraud and abuse. The 
procedures to be used shall be identified in the Native American 
grantee's Master Plan.
    (b) Each Native American grantee, subgrantee and contractor shall 
ensure that sufficient, auditable, and otherwise adequate records are 
maintained which support the expenditure of all funds under the Act. 
Such records shall be sufficient to allow the Secretary to audit and 
monitor the Native American grantees', subgrantees', and contractors' 
programs and shall include the maintenance of a management information 
system in accordance with the requirements ofSec. 632.32.
    (c) Any person having knowledge of fraud, criminal activity or other 
abuse shall report such information directly and immediately to the 
Secretary. Similarly, all complaints involving such matters should also 
be reported to the Secretary directly and immediately.

[[Page 299]]

Subpart G [Reserved]



Subpart H_Job Training Partnership Act Programs Under Title IV, Section 
                                   401



Sec.  632.170  Eligibility for funds.

    The Department shall provide funds under section 401 of the Act only 
to Native American grantees designated in accordance withSec. 632.10.



Sec.  632.171  Allocation of funds.

    (a) One hundred percent, except as provided inSec. 632.171(c), of 
the amount available for section 401 will be distributed by formula as 
follows:
    (1) Twenty-five percent of the available funds shall be allocated on 
the basis of the relative number of unemployed Indians and other Native 
Americans within the Native American grantee's geographic service area 
compared to the total number of unemployed Indians and other Native 
Americans in the United States.
    (2) Seventy-five percent of the available funds shall be allocated 
on the basis of the relative number of members of Indian and other 
Native Americans households, whose income is at or below the poverty 
level, within the Native American grantee's geographic service area 
compared to the total number of members of Indians and Native American 
households in poverty in the United States.
    (b) Commencing with Program Year 1985 and after consultation with 
Indian groups, the Department may reserve up to one percent of section 
401 funds. These funds may be used for technical assistance to improve 
the program's overall performance.
    (c) In situations when the Department determines that the formula 
allocation will result in severe disruption from one year to the next, a 
hold harmless or other factor to minimize such disruptions may be used.



Sec.  632.172  Eligibility for participation in title IV, section 401.

    (a) An Indian, Native Alaskan, or Native Hawaiian, as determined by 
the Native American Grantee, who is economically disadvantaged, or 
unemployed or underemployed is eligible to participate in a program 
under this subpart. For income eligibility purposes, the NAG may use 
either 6-months annualized or 12-months actual income.
    (b) Indians and other persons of Native American descent who meet 
the requirements of subsection (a) of this section and who are 
identified by the Federal or State government as ``landless'' or 
``terminated'' or ``non-federally recognized'' are included among those 
eligible to participate. These terms shall be broadly construed for the 
specific purpose of including, among others, terminated, State-
recognized, or other groups or individuals previously determined to be 
eligible for Indian services under the Comprehensive Employment and 
Training Act.
    (c) A Native American grantee may enroll Indian and Native American 
participants in upgrading and retraining programs who are not 
unemployed, underemployed or economically disadvantaged where such 
participants meet the following eligibility requirements:
    (1) For upgrading, a person must be operating at less than full 
skill potential, and working for at least the prior 6 months with the 
same employer in either an entry level, unskilled or semiskilled 
position or a paid position with little or no advancement opportunity in 
a normal promotional line. Priority consideration shall be given to the 
workers who have been in entry level positions for the longest time.
    (2) For retraining a person must have received a bona fide notice of 
impending layoff and have been determined by the grantee as having 
little opportunity to be reemployed in the same or equivalent occupation 
or skill level within the labor market area.



Sec.  632.173  Allowable program activities.

    (a) Native American grantees may undertake programs and activities 
consistent with the purposes of the Act including, but not limited to, 
programs and activities described in Sec.Sec. 632.78 through 632.81.
    (b) Native American grantees are encouraged to develop innovative 
means of addressing the needs of unemployed,

[[Page 300]]

underemployed and economically disadvantaged members of their 
communities and of contributing to the permanent economic self-
sufficiency of such communities.
    (c) Training and placement in the private sector will be emphasized. 
CSE and work experience are permitted when consistent over the long term 
with increasing earnings in unsubsidized employment. Expenditures for 
CSE are limited to 10 percent or the unemployment rate, based on data 
collected by an appropriate Federal or State agency including BIA, of a 
NAG's total section 401 allocation. For nonreservation grantees, the 
official BLS unemployment rate or State job service rate for the area 
will be used.
    (d) Wages and allowances are to be kept to a minimum to maximize 
funds to be used for training.
    (e) Innovative approaches to the private sector are encouraged.
    (f) Other activities described inSec. 632.80 should use no more 
than 25 percent of the funds. This limitation may be increased to 
accommodate the extraordinary costs associated with special training 
projects where it is clear the benefits support the additional cost. An 
increase to this limitation shall be approved in instances such as, but 
not limited to, rural participants needing relocation for training, when 
the costs of housing, transportation, etc., for training participants 
cannot be met within a 25 percent limitation, and for TERO activities.



Sec.  632.174  Administrative costs.

    Administrative costs for this subpart are limited to and shall not 
exceed 20 percent of the funds available.



         Subpart I_Summer Youth Employment and Training Programs



Sec.  632.250  General.

    This subpart contains the policies, rules, and regulations of the 
Department in implementing and administering a Summer Youth Employment 
and Training Program for Indians and other Native Americans authorized 
by title II, part B of the Act.



Sec.  632.251  Eligibility for funds.

    Only Native American grantees described in section 401(c)(1) of the 
Act are eligible for summer youth program funds.



Sec.  632.252  Allocation of funds.

    (a) For this program the Secretary shall reserve the same percentage 
of JTPA 3(b) funds as were available in the CETA, IV-C Fiscal Year 1983 
program.
    (b) Allocations shall be made to eligible Native American grantees 
on the basis of a formula using the best available data as determined by 
the Department in consultation with Native American groups and shall be 
published by the Secretary.



Sec.  632.253  Special operating provisions.

    Native American grantees shall:
    (a) Provide services to youths most in need;
    (b) Develop outreach and recruitment techniques aimed at all 
segments of the economically disadvantage youth population, especially 
school dropouts, youth not likely to return to school without assistance 
from the summer program, and youth who remain in school but are likely 
to be confronted with significant employment barriers relating to work 
attitude, aptitude, social adjustment, and other such factors;
    (c) Provide labor market orientation to participants. This 
orientation may include, as appropriate: vocational exposure, 
counseling, testing, resume preparation, job interview preparation, 
providing labor market information, providing information about other 
training programs available in the area, including apprenticeship 
programs, and similar activities. It may be provided on a group or 
individual basis. In providing labor market orientation, skill training 
and remedial education, each grantee shall make maximum efforts to 
develop cooperative relationships with other community resources so that 
these activities are provided in the summer program at no cost, or at 
minimum cost, to the summer program;
    (d) Assure that adequate supervision from skilled supervisors is 
provided to participants at each worksite;

[[Page 301]]

    (e) Make appropriate efforts to encourage educational agencies and 
post-secondary institutions to award academic credit for the 
competencies participants gain from their participation in the summer 
program;
    (f) Ensure that appropriate efforts are made to closely monitor the 
performance of the summer program and measure program results against 
established goals;
    (g) Ensure that enrollee applications are widely available and that 
jobs are awarded among individuals most severely disadvantaged in an 
equitable fashion. Enrollment applications shall require the signature 
of the applicant or (in the case of minors) the parent or guardian 
attesting to the accuracy of the information, including income data, 
provided on the application; and
    (h) Provide participants with an orientation to the program which 
shall include, but not be limited to: purposes of the program and the 
conditions and standards (including such items as hours of work, pay 
provisions and complaint procedures) for such activities in the program.



Sec.  632.254  Program startup.

    During the planning and design phase of the program and prior to the 
close of the school year, only those activities outlined inSec. 
632.255(b) are permissible. These activities shall be charged as 
administrative costs. Individuals may not begin participation in the 
program before the close of school.



Sec.  632.255  Program planning.

    (a)(1) In developing the summer program, the Native American grantee 
shall coordinate the summer plan with its title IV program.
    (2) Native American grantees shall use the planning process 
described inSec. 632.17.
    (b) The following planning and design activities shall be allowable 
beginning October 1 of each year;
    (1) Hiring of staff (planners, worksite developers, intake 
specialists, etc.), provided, prior to the close of school all staff 
salaries and benefits shall be charged as administrative expenses, 
except that 45 days prior to the beginning of the summer program and 45 
days after the summer program, all staff costs and other program 
development costs may be charged pursuant toSec. 632.38;
    (2) Development of the summer plan;
    (3) Worksite development;
    (4) Recruitment, intake and selection of participants;
    (5) Arrangements for supportive services;
    (6) Dissemination of program information;
    (7) Development of coordination between schools and other services;
    (8) Staff training; and
    (9) Other activities that may be characterized as planning and 
design but not program operation.
    (c) Expenses incurred in such planning and design activities may, 
pursuant toSec. 632.38, be paid from administrative funds received 
under other titles of the Act.



Sec.  632.256  Submission of applications.

    To the extent possible, Native American grantees will be notified of 
their summer youth allocation at the same time section 401 allocations 
are announced. The summer plan will be a separate part of the CAP and 
follow the same format as the CAP.



Sec.  632.257  Eligibility for participation.

    (a) An individual shall be eligible for participation if, at time of 
application, he or she is an Indian or Native American youth who is:
    (1) At the time of application, economically disadvantaged;
    (2) At the time of enrollment, age 14 through 21 inclusive; and
    (3) For income eligibility purposes, the NAG may use either six 
months annualized or 12 months actual income.
    (b) The nepotism provisions of this part shall not apply to this 
program,



Sec.  632.258  Allowable activities.

    Allowable activities are those listed inSec. 632.78-80 except that 
community service employment is not permitted.



Sec.  632.259  Vocational exploration program.

    A Native American grantee may conduct a vocational exploration 
program for the purpose of exposing youth to the operation and types of 
jobs and instruction including, where appropriate,

[[Page 302]]

limited and short term practical experience.



Sec.  632.260  Worksite standards.

    (a)(1) Each Native American grantee shall develop a written 
agreement with worksite employers which complies with sections 142 and 
143 of the Act and which assures:
    (i) Adequate supervision of each participant;
    (ii) Adequate accountability for participant time and attendance; 
and
    (iii) Adherence to the rules and regulations governig the summer 
program.
    (2) Such written agreements may be memoranda of understanding, 
simple work statements or other documents which indicate an estimate of 
the number of participants at the worksite and any operational 
conditions governing the program at the worksite.
    (b) Each Native American grantee shall establish procedures for the 
monitoring and evaluation of each worksite to insure compliance with the 
worksite agreements and the terms and conditions of subgrants and 
contracts.
    (c) No participant shall be required to work, or be compensated for 
work with JTPA funds, for more than 40 hours of work per week.



Sec.  632.261  Reporting requirements.

    (a) Each Native American grantee shall submit an end of summer 
report which will include both financial and characteristics 
information. The report format will be issued to grantees under separate 
instructions.
    (b) The report in this section is to be submitted to Chief, DINAP by 
registered mail no later than 45 days after the end of the summer 
program.



Sec.  632.262  Termination date for the summer program.

    Participants may not be enrolled in the summer program beyond 
September 30, or beyond the date they resume school full-time, whichever 
occurs earlier. Allowable activities after September 30 include report 
and record preparation and submittal, completion of evaluations and 
assessments of worksite employers and the overall program or other 
elements of the summer program.



Sec.  632.263  Administrative costs.

    Administrative costs for this subpart are limited to and shall not 
exceed 20 percent of the funds available.



PART 633_MIGRANT AND SEASONAL FARMWORKER PROGRAMS--Table of Contents



                    Subpart A_Introductory Provisions

Sec.
633.102 Scope and purpose of title IV, section 402 programs.
633.103 Format for these regulations.
633.104 Definitions.
633.105 Allocation of funds.
633.106 Eligibility for allocable funds.
633.107 Eligibility for participation in section 402 programs.

           Subpart B_Grant Planning and Application Procedures

633.201 Grant planning and application procedures in general.
633.202 Announcement of State planning estimates and invitation to 
          submit a grant application.
633.203 Review of funding request.
633.204 Responsibility review.
633.205 Notification of selection.

         Subpart C_Program Design and Administrative Procedures

633.301 General responsibilities.
633.302 Training activities and services.
633.303 Allowable costs.
633.304 Section 402 cost allocation.
633.305 General benefits and working conditions for program 
          participants.
633.306 Retirement benefits.
633.307 Packages of benefits.
633.308 Non-federal status of participants.
633.309 Recordkeeping requirements.
633.310 Bonding.
633.311 Management information systems.
633.312 Grantees contracts and subgrants.
633.313 Administrative staff and personnel standards.
633.314 Reports required.
633.315 Replacement, corrective action, termination.
633.316 Closeout procedures.
633.317 Reallocation of funds.
633.318 Nondiscrimination and nonsectarian activities.
633.319 Lobbying, political activities and unionization.
633.320 Nepotism.
633.321 Performance standards for section 402 programs.
633.322 Sanctions for violation of the Act.


[[Page 303]]


    Authority: Job Training Partnership Act, sec.169 (29 U.S.C. 1501 et 
seq., Pub. L. 97-300, 96 Stat. 1322), unless otherwise noted.

    Source: 48 FR 48771, Oct. 20, 1983, unless otherwise noted.



                    Subpart A_Introductory Provisions



Sec.  633.102  Scope and purpose of title IV, section 402 programs.

    (a) It is the purpose of title IV, section 402, of the Act to 
provide job training, employment opportunities, and other services for 
those individuals who suffer chronic seasonal unemployment and 
underemployment in the agriculture industry. These conditions have been 
substantially aggravated by continual advancements in technology and 
mechanization resulting in displacement and contribute significantly to 
the Nation's rural employment problem. These factors substantially 
affect the entire national economy.
    (b) Because of farmworker employment and training problems, such 
programs shall be centrally administered at the national level. Programs 
and activities supported under this section shall in accordance with 
section 402(c)(3) of the Act:
    (1) Enable farmworkers and their dependents to obtain or retain 
employment;
    (2) Allow participation in other program activities leading to their 
eventual placement in unsubsidized agricultural or nonagricultural 
employment;
    (3) Allow activities leading to stabilization in agricultural 
employment; and
    (4) Include related assistance and supportive services.



Sec.  633.103  Format for these regulations.

    (a) Regulations promulgated by the Department to implement the 
provisions of title IV section 402 of the Act are set forth in 20 CFR 
part 633 and part 636. These parts contain all the regulations under the 
Act applicable to migrant and other seasonally employed farmworker 
programs.
    (b) Should the regulations at this part conflict with regulations at 
other parts of this title of the Code of Federal Regulations, the 
regulations at this part shall prevail with respect to programs and 
activities governed by this part.



Sec.  633.104  Definitions.

    The following definitions are applicable to section 402 programs.
    Accrued expenditures shall mean total costs incurred during the 
reporting period for: (a) Goods and other tangible property received; 
(b) services performed by employees, contractors, subgrantees and other 
payees; and (c) other amounts becoming owed under programs for which no 
current services or performance is required such as annuities, insurance 
claims, and other benefit payments.
    Act shall mean the Job Training Partnership Act (29 U.S.C. 1501 et 
seq.).
    Allocation shall mean the amount of funds calculated in accordance 
withSec. 633.105(b)(1) for section 402 programs in each State and 
distributed in accordance with the requirements of this part.
    Chief, DFREP shall mean the Chief of the Division of Farmworker and 
Rural Employment Programs in the Employment and Training Administration, 
Department of Labor.
    Construction shall mean the erection, installation, assembly, or 
painting of a new structure or a major addition, expansion, or extension 
of an existing structure, and the related site preparation, excavation, 
filling and landscaping or other land improvements.
    Department shall mean the United States Department of Labor (DOL), 
including its agencies and organizational units.
    DOL shall mean the United States Department of Labor.
    Employment shall mean the situation wherein a person(s) provides 
work or services for an employer for wages or salary. This includes 
self-employment. The satisfaction of workfare requirements does not 
constitute employment.
    Entered employment shall mean the act of securing unsubsidized 
employment for or by a participant. Seasonal agricultural placements 
will not be considered as unsubsidized employment secured for or by a 
participant for purposes of this definition unless it can be 
substantiated that the placement represents an upgraded position

[[Page 304]]

within agriculture and will not result in the continued underemployment 
of the individual.
    Entered employment, direct shall mean unsubsidized employment 
secured for or by a participant after receiving direct placement 
services not associated with training or subsidized employment.
    Entered employment, indirect shall mean unsubsidized employment 
secured for or by a participant after participation in training or 
subsidized employment.
    Family (a) shall mean one or more persons related by blood, 
marriage, or adoption. A step-child or a step-parent is considered to be 
related by marriage.
    (b)(1) For purposes of paragraph (a) of this definition, a person 
claimed as a dependent on another person's Federal Income Tax return for 
the previous year is presumed to be part of the other person's family.
    (2) A handicapped individual may be considered a family of one when 
applying for programs under the Act.
    (3) An individual 18 years of age or older, except as provided in 
(a) or (b) above, who receives less than 50 percent of support from the 
family, and who is not the principal earner nor the spouse of the 
principal earner, is not considered a member of the family. Such an 
individual is considered a family of one.
    Family income shall mean all income received from all sources for 
the eligibility determination period by persons who are family members 
at the time of eligibility determination.
    (a) For the purpose of determining eligibility (and not for 
allocations), family income includes:
    (1) Gross wages and salaries (before deductions);
    (2) Net self-employment income (gross receipts minus operating 
expenses); and
    (3) Other money income received from sources such as net rents, Old 
Age and Survivors Insurance, Social Security benefits, pensions, 
alimony, periodic income from insurance policy annuities, and other 
sources of income.
    (b) Earned family income does not include:
    (1) Non-cash income such as food stamps, or compensation received in 
the form of food or housing;
    (2) Rental value of owner-occupied property;
    (3) Public assistance payments;
    (4) Cash payments received pursuant to a State plan approved under 
titles I, IV, X or XVI of the Social Security Act, or disability 
insurance payments received under title II of the Social Security Act;
    (5) Federal, State or local unemployment benefits;
    (6) Payments made to participants in employment and training 
programs;
    (7) Capital gains and losses;
    (8) One-time unearned income, such as, but not limited to:
    (i) Payments received for a limited fixed term under income 
maintenance programs and supplemental (private) unemployment benefits 
plans;
    (ii) One-time or fixed-term scholarship and fellowship grants;
    (iii) Accident, health, and casualty insurance proceeds;
    (iv) Disability and death payments, including fixed term (but not 
lifetime) life insurance annuities and death benefits;
    (v) One-time awards and gifts;
    (vi) Inheritance, including fixed term annuities;
    (vii) Fixed-term workers' compensation awards;
    (viii) Terminal leave pay;
    (ix) Soil bank payments; and
    (x) Agriculture crop stabilization payments.
    (9) Pay or allowances received by any veteran while he/she was 
serving on active duty in the Armed Forces;
    (10) Educational assistance and compensation payments to veterans 
and other eligible persons under chapters 11, 13, 31, 34, 35, and 36 of 
title 38, United States Code;
    (11) Payments received under the Trade Act of 1974 as amended;
    (12) Black Lung payments received under the Benefits Reform Act of 
1977, Pub. L. 95-239, 30 USC 901; and
    (13) Child support payments.
    Farmwork shall mean, for eligibility purposes, work performed for 
wages in agricultural production or agricultural services as defined in 
the most recent

[[Page 305]]

edition of the Standard Industrial Classification (SIC) Code definitions 
included in industries 01--Agricultural Production--Crops; 02--
Agricultural Production--Livestock excluding 027--Animal Specialties; 
07--Agricultural Services excluding 074--Veterinary Services, 0752--
Animal Speciality Services, and 078--Landscape and Horticultural 
Services.
    Grantee shall mean any person, organization or other entity which 
receives JTPA funds directly from the Department.
    JTPA shall mean the Job Training Partnership Act.
    Migrant farmworker shall mean a seasonal farmworker who performs or 
has performed farmwork during the eligibility determination period (any 
consecutive 12-month period within the 24-month period preceding 
application for enrollment) which requires travel such that the worker 
is unable to return to his/her domicile (permanent place of residence) 
within the same day.
    Participant shall mean an individual who is:
    (a) Eligible for participation; and
    (b) Enrolled within 45 days of eligibility determination; and
    (c) Enrolled and receiving employment, training or services (except 
post-termination services) funded under the Act.
    Planning estimates shall mean the preliminary allocations announced 
for the purpose of providing target funding levels for each State.
    Program income shall mean net income earned from grant or agreement 
supported activities. Such earnings include, but are not limited to: 
income from service fees, sale of commodities, usage or rental fees, and 
royalties on patents or copyrights.
    Poverty level shall mean the annual income level at, or below which 
families are considered to live in poverty, as annually determined by 
HHS.
    Seasonal farmworker shall mean a person who during the eligibility 
determination period (any consecutive 12-month period within the 24-
month period preceding application for enrollment) was employed at least 
25 days in farmwork or earned at least $400 in farmwork; and who has 
been primarily employed in farmwork on a seasonal basis, without a 
constant year round salary.
    Section 402 programs shall mean the Migrant and Seasonal Farmworker 
Program, under section 402 of title IV of the Job Training Partnership 
Act.
    The term subsidized employment shall mean employment created in the 
private or public sector and in private nonprofit agencies financed by 
the recipient's program funds or by other DOL funded programs, e.g., 
work experience and tryout employment.
    Supplemental funds shall mean any funds allocated in excess of that 
amount announced as a ``planning estimate.''
    Target area shall mean a geographic area to be served by a section 
402 grantee. Such an area may be a county, multicounty area, a State, or 
a multistate area.
    Target population shall mean farmworkers and their dependents who 
meet the requirements ofSec. 633.107.
    Underemployed persons shall mean:
    (a) Persons who are working part-time but seeking full-time work; or
    (b) Persons who are working full-time but whose current annualized 
wage rate (for a family of one), or whose family's current annualized 
income, is not in excess of:
    (1) The poverty level, or
    (2) 70 percent of the lower living standard income level.
    Unemployed individuals shall mean individuals who are without jobs 
and who want and are available for work. The determination of whether 
individuals are without jobs shall be made in accordance with the 
criteria used by the Bureau of Labor Statistics of the Department in 
defining individuals as unemployed.



Sec.  633.105  Allocation of funds.

    (a) National Account. (1) Up to 6 percent of the statutory reserves 
for section 402 activities may be set aside for the National Account to 
be used for technical assistance and for special projects funded at the 
discretion of the Department.
    (2) Funds from the National Account may be obligated by the 
Department by means of either contracts or grants to private nonprofit 
agencies, to private profitmaking organizations, to

[[Page 306]]

States and local units of government, or public agencies.
    (b) State allocations (allocable funds). (1) No less than 94 percent 
of the funds received for section 402 activities shall be allocated for 
farmworker programs in individual States in an equitable manner using 
the best data available as to the farmworker population as determined by 
the Department. The formula used to determine State allocations will be 
published in the Federal Register for review and comment, along with the 
rationale for such formula and proposed allocations, no later than 30 
days prior to the publication of the final allocations of available 
funds in the Federal Register.
    (2) Allocation exceptions. (i) The Department reserves the right not 
to allocate any funds for use in a State whose allocation is less than 
$120,000.
    (ii) Those funds not allocated will be available for technical 
assistance and special projects funded at the discretion of the 
Department.
    (iii) Current grantees which are unsuccessful applicants for new 
grant funds shall be given notice that funds will expire and that a 
reasonable period will be given to phase out their operations. Such 
notice will not bind the Department to obligate additional funds. The 
notification of nonselection shall be the notice of termination of funds 
and departmental closeout requirements are to be followed.
    (3) Allocation adjustment. In situations where the Department 
determines that the formula allocation will result in severe disruption 
of funding levels from one year to the next, a hold harmless or other 
factor to minimize such disruption may be used.
    (4) Funding cycle. Projects will be funded in accordance with a 
schedule to be specified by the Department in the Federal Register:
    (i) Announcement of State planning estimates and an invitation to 
submit applications for State(s) or area(s) open for competition as 
provided in the Solicitation for Grant Application (SGA).
    (ii) Deadline for submission of Preapplication for Federal 
Assistance Forms.
    (iii) Deadline for submission of applications.



Sec.  633.106  Eligibility for allocable funds.

    The following organizations and units of government shall be 
eligible to receive funds under section 402.
    (a) A public agency;
    (b) A private nonprofit organization authorized by its charter or 
articles of incorporation to provide employment and training or such 
other services as are permitted by this subpart.



Sec.  633.107  Eligibility for participation in section 402 programs.

    (a) Eligibility for participation in section 402 programs is limited 
to those individuals who have, during any consective 12-month period 
within the 24-month period preceding their application for enrollment:
    (1) Been a seasonal farmworker or migrant farmworker as defined in 
Sec.  633.104; and,
    (2) Received at least 50 percent of their total earned income or 
been employed at least 50 percent of their total work time in farmwork; 
and,
    (3) Been identified as a member of a family which receives public 
assistance or whose annual family income does not exceed the higher of 
either the proverty level or 70 percent of the lower living standard 
income level.
    (4) Dependents of the above individuals are also eligible.
    (b) The 24-month period preceding application for enrollment shall 
be extended for persons who have been in the armed forces, incarcerated, 
hospitalized, or physically or mentally disabled. The extended period of 
time shall be not more than 24 months plus the amount of time the person 
was in the armed forces, incarcerated, detained at any Federal or State 
facility, hospitalized, or physically or mentally disabled. Such 
conditions shall be positively demonstrated by the applicant. This can 
be done by producing documentary evidence satisfactory to the grantee.
    (c) To be eligible for participation, individuals shall meet the 
requirements of sections 167(a)(5) and 504 of the Act.
    (d) A participant in another program or title under JTPA who met the 
eligibility criteria for section 402 at the

[[Page 307]]

time of enrollment into such other program or title may be transferred 
into, or enrolled concurrently, in the section 402 program. A section 
402 participant who met the eligibility criteria for another program or 
title under JTPA at the time of enrollment into the section 402 program 
may also be transferred into or enrolled concurrently in such other 
program or title.
    (e) The grantee shall establish the necessary procedures for 
identifying and selecting participants and for eligibility determination 
and verification.
    (f) The provisions of section 181(k) of the Act are applicable to 
section 402 programs.



           Subpart B_Grant Planning and Application Procedures



Sec.  633.201  Grant planning and application procedures in general.

    Precondition for grant application: The Department will not consider 
an application for funding from any applicant in cases where it is 
established that:
    (a) The agency's efforts to recover debts (for which three demand 
letters have been sent) established by final agency action have been 
unsuccessful; or
    (b) Fraud or criminal activity has been proven to exist within the 
organization.



Sec.  633.202  Announcement of State planning estimates and invitation
to submit a grant application.

    (a) Announcements. The Department, through a notice in the Federal 
Register, will announce State Planning estimates of section 402 funds 
and will publish an SGA for all areas open to competition. The SGA will 
contain all information needed by an applicant to apply for funding; 
i.e., general program description, rating criteria, and dates for 
submission of applications.
    (b) Intention to apply. Any eligible applicant intending to apply 
for funds shall submit a Preapplication for Federal Assistance to DOL by 
a specified date as announced in the Federal Register.
    (c) Applications for statewide programs are encouraged; however, the 
Department reserves the right to award grant funds to less than 
statewide areas.
    (d) Executive Order 12372, ``Intergovernmental Review of Federal 
Programs,'' and the implementing regulations at 30 CFR part 46 generally 
apply to this program. Pursuant to these requirements, in States which 
have established a consultation process expressly covering this program, 
applications shall be provided to the State for comment. Since States 
may also participate as competitors for this program, applications shall 
be submitted to the State upon the deadline for submission to the 
Department, instead of the usual 30-day period for review.



Sec.  633.203  Review of funding request.

    The SGA will identify all review standards including:
    (a) An understanding of the problems of migrant and seasonal 
farmworkers;
    (b) A familiarity with the area to be served;
    (c) A previously demonstrated capability to administer effectively a 
diversified employability development program for migrant and seasonal 
farmworkers.
    (d) General administrative and financial management capability.
    (e) Prior performance with respect to financial management, audit 
and program outcomes.



Sec.  633.204  Responsibility review.

    (a) Prior to final selection as a potential grantee the Department 
will conduct a review of the available records to determine whether or 
not the organization has failed any responsibility test. This review is 
intended to establish overall responsibility to administer Federal 
funds. With the exceptions of paragraphs (a)(1) and (a)(3) of this 
section, the failure to meet any one of the tests would not establish 
that the organization is irresponsible unless the failure is substantial 
or persistent. The responsibility tests are as follows:
    (1) The agency's efforts to recover debts (for which three demand 
letters have been sent) established by final agency action have been 
unsuccessful, or failure to comply with an approved repayment plan.

[[Page 308]]

    (2) Serious administrative deficiencies identified in final findings 
and determinations--such as failure to maintain a financial management 
system as required by Federal regulations.
    (3) Established fraud or criminal activity within the organization.
    (4) Wilfull obstruction of the audit process.
    (5) Substantial failure to provide services to applicants as agreed 
to in a current or recent grant or to meet performance standard 
requirements as provided atSec. 633.321 of this subpart.
    (6) Failure to correct deficiencies brought to the grantees' 
attention in writing as a result of monitoring activities, reviews, 
assessments, etc.
    (7) Failure to return a grant closeout package or outstanding 
advances within 90 days of expiration date or receipt of closeout 
package, whichever is later, unless an extension has been requested and 
granted; final billings reflecting serious cost category or total budget 
cost overrun.
    (8) Failure to submit required reports.
    (9) Failure to properly report and dispose of government property as 
instructed by DOL.
    (10) Failure to have maintained cost controls resulting in excess 
cash on hand.
    (11) Failure to procure or arrange for audit coverage for any two 
year period when required by DOL.
    (12) Failure to audit a subrecipient within the required period when 
applicable.
    (13) Final disallowed costs in excess of five percent of the grant 
or contract award.
    (14) Failure to establish a mechanism to resolve subrecipient's 
audit within established time frames.
    (b) This responsibility review is independent of the competitive 
process. Applicants failing to meet the requirements of this section 
will not be selected as potential grantees irrespective of their 
standing in the competition.



Sec.  633.205  Notification of selection.

    (a) Respondents to the SGA which are selected as potential grantees 
shall be so notified by the Department. The notification shall invite 
each potential grantee to negotiate the final terms and conditions of 
the grant, shall establish a reasonable time and place for the 
negotiation, and shall indicate the State or area to be covered by the 
grant. Funds may be awarded for two program years.
    (b) In the event that no grant applications are received for a 
specific State or area or that those received are deemed to be 
unacceptable, or where a grant agreement is not successfully negotiated, 
the Department may give the Governor first right to submit an acceptable 
application pursuant toSec. 633.201. Should the Governor not accept 
the offer within fifteen days, the Department may then (1) designate 
another organization or organizations, (2) reopen the area for 
competitive bidding, or (3) use the funds for national-account 
activities.
    (c) An applicant whose grant application is not selected by the 
Department to receive section 402 funds shall be notified in writing.
    (d) Applicants who submit grant applications which have been 
rejected may not resubmit a new grant application for the State(s) or 
area(s) in which they are interested in providing services until the 
area(s) is announced by the Department as reopened for competition.
    (e) Any applicant whose grant application is denied in whole or in 
part by the Department may request an administrative review as provided 
in part 636, with respect to whether there is a basis in the record to 
support the Department's decision. This appeal will not in any way 
interfere with the Department's designation and funding of another 
organization to service the area in question during the appeal period. 
The available remedy under such an appeal will be the right to be 
designated in the future rather than a retroactive or immediately 
effective selection status. Therefore, in the event the ALJ rules that 
the organization should have been selected and the organization 
continues to meet the requirements of this part, the Department will 
select and fund the organization within 90 days of the ALJ's decision 
unless the end of the 90-day period is within 6 months of the end of the 
funding period. Any organization selected and/or

[[Page 309]]

funded prior to the ALJ's decision will be affected in a manner 
prescribed by the Department. All parties will agree to the provisions 
of this paragraph as a condition for funding.



         Subpart C_Program Design and Administrative Procedures



Sec.  633.301  General responsibilities.

    (a) This subpart sets forth the program operation requirements for 
grantees under section 402, including program and fiscal management, 
coordination and consultation, allowable activities, participant 
benefits, and duration of participation. Unless otherwise indicated, 
grantees shall follow procedures as prescribed in DOL administrative 
regulations a 41 CFR part 29-70 and OMB Circular A-122.
    (b) Basic program design responsibilities of grantees. A grantee 
shall be responsible for:
    (1) Designing training which, to the maximum extent feasible, is 
consistent with every participant's fullest capabilites and will lead to 
employment opportunities enabling every participant to become 
economically self-sufficient.
    (2) Designing program activities which will, to the maximum extent 
feasible, contribute to the occupational development and upward mobility 
of every participant;
    (3) Providing training only to participants who are legally able to 
accept gainful employment in the occupation for which training is being 
provided; and
    (4) Making maximum efforts to achieve the goals and the performance 
standards set forth in the grant.



Sec.  633.302  Training activities and services.

    (a) A grantee may provide assistance to eligible individuals to 
obtain or retain employment, to participate in other program activities 
leading to their eventual placement in unsubsidized agricultural or 
nonagricultural employment, and to participate in activities leading to 
stabilization in agricultural employment through training and supportive 
services which may include, but are not limited to:
    (1) Job search assistance, including job clubs;
    (2) Job development;
    (3) Training, such as classroom, on-the-job, work experience, and 
tryout employment, in jobs skills for which demand exceeds supply;
    (4) Training related and non-training related supportive services, 
including commuting assistance and financial and personal counseling;
    (5) Relocation assistance; and
    (6) Programs conducted in cooperation with employers or labor 
organizations to provide early intervention in the event of the 
disruption of employment opportunities.
    (b) Public service employment is not an allowable activity under 
section 402 programs.
    (c) Tryout employment shall conform to section 205(d)(3)(B) and 
section 141(k) of the Act.
    (d) A participant's enrollment in work experience shall not exceed 
1,000 hours in a one-year period.



Sec.  633.303  Allowable costs.

    (a) General. To be allowable, a cost must be necessary and 
reasonable for proper and efficient administration of the program, be 
allocable thereto under these principles, and, except as specifically 
provided herein, not be a general expense required to carry out the 
overall responsibilities of the recipient.
    (b) Unless otherwise indicated below, direct and indirect costs 
shall be charged in accordance with 41 CFR part 29-70 and OMB Circular 
A-122.
    (c) Funds may be used for construction activities only to:
    (1) Provide compensation to participants employed by public or 
private nonprofit agencies;
    (2) Reimburse OJT costs to private-for-profit employers;
    (3) Purchase equipment, materials, and supplies for use in the 
training of such participants; and
    (4) Cover costs of a training program in a construction occupation, 
including costs such as instructors' salaries, training tools, books, 
and needs-based payments and compensation to participants.

[[Page 310]]

    (d) Costs associated with capital improvements (as defined in OMB 
Circular A-122, attachment B, sections 13 and 22) of existing facilities 
used primarily for programs under the Act are allowable with prior 
approval of the Department.
    (e) Unemployment compensation costs are allowable for administrative 
and program staff hired in accordance with the administrative provisions 
of the regulations, and for participants required by State law to be 
covered for unemployment compensation purposes.
    (f) Costs which are billed as a single unit charge do not have to be 
allocated or prorated among the several cost categories but may be 
charged entirely to training when the agreement:
    (1) Is for classroom training;
    (2) Is fixed unit price; and
    (3) Stipulates that full payment for the full unit price will be 
made only upon completion of training by a participant and placement of 
the participant into unsubsidized employment in the occupation trained 
for and at not less than the wage specified in the agreement.
    (g) Travel costs. (1) The cost of participant and staff travel 
necessary for the operation or administration of programs under the Act 
is allowable as provided herein.
    (2) Travel costs of section 402 administrative staff or members of 
governing boards of grantee organizations are allowable without the 
prior approval of the Department if the travel specifically relates to 
programs under section 402. All other travel to be charged to JTPA 
section 402 grants shall require the prior approval of the Department. 
These costs shall be charged to administration.
    (3) Travel costs of other grantee officials of multifunded programs 
changed with overall grantee responsibilities are allowable only if 
costs specifically relate to programs under section 402.
    (4) Travel costs to enable participants to obtain or retain 
employment, access other services or to participate in programs under 
this Act are allowable as direct costs but shall be limited to the 
grantee's jurisdiction or within daily commuting distance, unless part 
of an approved component of the grantee's program. These costs shall be 
charged to training-related supportive services.
    (5) Travel costs for participants in administrative or programmatic 
positions using their personal or other forms of transportation in the 
performance of their jobs are allowable and shall be charged 
appropriately.
    (6) Travel policies of all grantees, subgrantees and contractors 
shall be generally consistent with those set forth in the Department's 
Travel and Transportation Manual.
    (h) Association membership. Grantees are permitted to use grant 
funds to join those associations which provide technical and 
administrative services in support of section 402 program efforts. The 
activities of such associations must be designed to contribute to the 
enhancement of professional and technical program knowledge. No 
financial assistance in the form of membership dues or other membership-
related costs can involve political or lobbying activities.
    (1) The cost shall be for a section 402 grantee's membership rather 
than an individual person's membership.
    (2) The cost of a membership shall be reasonably related to the 
value of the services or benefits received and shall not exceed $850 
annually.
    (3) Association-related costs shall be incorporated in the grantee's 
section 402 grant budget, charged to the administrative category, and as 
such, shall be subject to the overall administrative cost ceiling.
    (i) Allowances and reimbursements for board and advisory council 
members--(1) General. A reasonable allowance to members who attend 
meetings of any board, council, or committee for section 402 program 
purposes, and reimbursement of actual expenses connected with those 
meetings, are allowable costs, and may be paid for attendance at no more 
than six meeting days per grantee per quarter.
    (2) Allowances and loss of wages. Any individual or family member 
who is a member of a private nonprofit grantee or subgrantee 
policymaking body or of a public agency grantee or subgrantee farmworker 
advisory council is eligible to be paid and allowance provided:
    (i) such individual's family income does not exceed either 70 
percent of the

[[Page 311]]

lower living standard income level or the poverty level as established 
by HHS.
    (ii) Allowances may not be paid for attendance in excess of ten 
dollars per meeting, unless approved in advance by the Department.
    (3) Reimbursement for expenses. (i) All board members shall be 
eligible for receiving reimbursement for actual expenses of travel, 
meals, and lodging incurred in attending board meetings, or a per diem 
in lieu of actual expenses.
    (ii) Any individual or family member where family income does not 
exceed 70 percent of the lower living standard income level and who is a 
member of a private nonprofit grantee or subgrantee policymaking body or 
of a public agency grantee or subgrantee farmworker advisory council 
shall also be eligible for reimbursement of actual wages lost, if 
supported by a statement from the employer.
    (iii) The grantee shall define which expenses may be reimbursed, 
whether incurred as the result of actual meeting attendances or in 
performance of other official duties and responsibilities in connection 
with the program, and shall establish procedures for the reimbursement 
of such expenses.



Sec.  633.304  Section 402 cost allocation.

    (a) General. Allowable costs for section 402 programs shall be 
charged against the following four cost categories: Administration; 
training; training-related supportive services; and nontraining-related 
supportive services.
    (1) Costs are allocable to a particular cost category to the extent 
that benefits are received by such category.
    (2) All grantees are required to plan, control, and report 
expenditures against the aforementioned cost categories.
    (3) All grantees are responsible for ensuring that subgrantees and 
contractors plan, control, and report expenditures against the 
aforementioned cost categories.
    (b) Limitation on certain costs. (1) Costs for administration of the 
grant shall not exceed 20 percent of the total amount of the grant.
    (2) Costs for nontraining-related supportive services shall not 
exceed 15 percent of the total amount of the grant.
    (3) Costs for training shall be no less than 50 percent of the total 
amount of the grant.
    (c) Classification of costs by category. All grant costs shall be 
charged to the four cost categories listed above. Within each category 
costs shall be assigned and accounted for as follows:
    (1) Administration. Administration costs consist of all direct and 
indirect costs associated with the management of the program. 
Administrative costs shall be limited to those necessary to effectively 
operate the program. These costs include but are not limited to: the 
salaries and fringe benefits of personnel engaged in executive, fiscal, 
data collection, personnel, legal, audit, procurement, data processing, 
communications, maintenance, and similar functions; and related 
materials, supplies, equipment, office-space costs, and staff training.
    (i) Also included are salaries and fringe benefits of direct program 
administrative positions such as supervisors, program analysts, labor 
market analysts, and project directors. Additionally, all costs of 
clerical personnel, materials, supplies, equipment, space, utilities, 
and travel that are identifiable with these program-administration 
positions are charged to administration.
    (ii) Allowances and reimbursement costs for governing boards and 
advisory councils shall be prorated wherever applicable as 
administrative costs among all the grants, from whatever source, 
administered by the grantee.
    (2) Training. (i) Instruction and related costs consist of goods and 
services which affect those program participants who are in either a 
work environment, or classroom setting (including classroom training in 
conjunction with Vocational Exploration or Job Readiness or tryout 
employment) and shall be charged to training, i.e., salaries, fringe 
benefits, space, utility, travel and equipment. Training costs include, 
but are not limited to, the following: The costs associated with on-the-
job training services; employer

[[Page 312]]

outreach necessary to obtain job listings or job-training opportunities, 
salaries; fringe benefits; equipment and supplies of personnel engaged 
in providing training, including remedial education; job-related 
counseling for participants; employability assessment and job 
development; tuition fees, books and other teaching aids; equipment and 
materials used in providing training to participants, classroom space 
and utility costs; job search assistance, labor market orientation, and 
job referral costs. In addition:
    (ii) Wages and fringe benefits for participants in work experience, 
tryout employment, classroom training, shall be charged to training. 
Cost-of-living increases are considered wages.
    (iii) Allowances shall be charged to training.
    (iv) Any single cost which is properly chargeable to training and to 
one or more other categories shall be prorated among training and other 
appropriate cost categories.
    (3) Training-related supportive services. Costs of services which 
are necessary to enable an eligible individual to participate in 
training or subsidized employment under section 402 and to obtain 
subsequent unsubsidized employment shall be charged to training-related 
supportive services. Such supportive services may include but are not 
limited to transportation, health care, special services and materials 
for the handicapped, child care, meals, temporary shelter, financial 
counseling, and other reasonable expenses required for participation in 
the program and may be provided in-kind or through cash assistance. 
Training-related supportive services costs and related costs shall be 
charged to this cost category.
    (4) Nontraining-related supportive services. ``Services only'' are 
the costs of the goods and services provided to participants who are not 
engaged in work experience, tryout employment or training activities, 
including but not limited to such goods and services as: transportation, 
health care, temporary shelter, meals and other nutritional assistance, 
legal or paralegal assistance and emergency assistance.
    (d) Cost categories assignable to program activities. (1) Classroom 
training. Cost categories are: Training and training-related supportive 
services.
    (2) On-the-job training. Cost categories are: Training and training-
related supportive services.
    (3) Work Experience: Cost categories are: Training and training-
related supportive services.
    (4) Tryout employment: Cost categories are: Training and training-
related supportive services.
    (5) Training assistance: Cost categories are: Training and training-
related supportive services.
    (6) Services only (no referral to employment): Cost category is: 
Nontraining-related supportive services.



Sec.  633.305  General benefits and working conditions for program
participants.

    (a) Payments for on-the-job training (OJT) shall be made in 
accordance with sections 141(g) and 142(a)(2) of the Act.
    (b) Participants employed in work experience activities shall be 
paid wages in accordance with section 142(a)(3) of the Act.
    (c) Payments to individuals participating in programs under section 
402 shall conform to the provisions of section 142(b) of the Act.
    (d) Section 402 grantees shall not assist any activity under the Act 
unless the activity conforms to provisions of sections 142 and 143 of 
the Act.
    (e) A basic hourly allowance for regularly enrolled classroom 
training participants shall not exceed the higher of the State or 
Federal minimum hourly wage.



Sec.  633.306  Retirement benefits.

    No funds available under this Act may be used for contributions on 
behalf of any participant to retirement systems or plans (sec. 
143(a)(5)).



Sec.  633.307  Packages of benefits.

    (a) Where non-JTPA, similarly employed employees are covered under a 
benefits package which includes retirement, JTPA participants shall 
receive the non-retirement benefits (e.g., health, death, and 
disability-benefit coverage), at the same level and to the same extent 
as other employees. JTPA funds may be used to pay for those benefits.

[[Page 313]]

    (b) JTPA funds may be used to purchase a package of benefits 
including retirement, provided the retirement portion of the package can 
be factored out of the package and adjusted accordingly.



Sec.  633.308  Non-Federal status of participants.

    Except where specifically provided to the contrary, participants in 
a program under the Act shall not be deemed Federal employees and shall 
not be subject to the provisions of law relating to Federal employment, 
including those related to hours of work, rates of compensation, leave, 
unemployment compensation, and Federal employment benefits.



Sec.  633.309  Recordkeeping requirements.

    (a) Each grantee shall ensure maintenance of systems whose financial 
management and participant data components provide federally-required 
records and reports that are accurate, uniform in definition, accessible 
to authorized Federal staff, and verifiable for monitoring, reporting, 
and evaluation purposes.
    (b) The grantee shall ensure that systems:
    (1) Maintain data elements used in required Federal reports in 
accordance with established program definitions contained in the Act and 
these regulations;
    (2) Follow consistent rules for aggregation of detailed data to 
summary levels;
    (3) Are able to track data from detailed records to summary reports;
    (4) Maintain procedures to ensure that information is current, 
complete, consistent, and accurate;
    (5) Meet generally accepted accounting principles as prescribed in 
41 CFR part 29-70;
    (6) Provide for adequate control of Federal funds and other assets;
    (7) Trace the funds to a level of expenditures adequate to 
demonstrate that funds have been spent lawfully;
    (8) Maintain internal controls to avoid conflict-of-interest 
situations and prevent irregular transactions or activities;
    (9) Support accounting records with source documentation such as 
cancelled checks, paid bills, contracts, grants, and agreements; and
    (10) Establish procedures that will minimize the time elapsing 
between the receipt of advanced funds and their disbursement.



Sec.  633.310  Bonding.

    The grantee and all subgrantees shall ensure that every officer, 
director, agent, or employee authorized to act on their behalf in 
receiving or depositing funds into program accounts or in issuing 
financial documents, checks, or other instruments of payment for program 
costs shall be bonded to provide protection against loss. Those costs 
are chargeable to administration.



Sec.  633.311  Management information systems.

    All grantees shall establish and maintain a program and financial 
management system which meets Departmental standards and the 
requirements ofSec. 633.314.



Sec.  633.312  Grantees contracts and subgrants.

    (a) Grantee responsibility. (1) The grantee is responsible for 
development, approval and operation of all contracts and subgrants and 
shall require that its contractors and subgrantees adhere to the 
requirements of the Act, regulations promulgated under the Act, and 
other applicable laws as required by DOL.
    (2) The grantee shall require contractors and subgrantees to 
maintain effective control and accountability over all funds, property 
and other assets covered by the contract or subgrant.
    (3) Each grantee, subgrantee and contractor shall establish and use 
internal program management procedures sufficient to prevent fraud and 
abuse.
    (4) The grantee shall ensure that contractors and subgrantees 
maintain and make available for review by the grantee and the Department 
of Labor all records pertaining to the operations of programs under such 
contracts and subgrants, consistent with the maintenance and retention 
of record requirements.
    (5) Subgrantees are entitled to funding for administrative costs. 
The

[[Page 314]]

amount of such funding will be determined during the development of 
subgrants.
    (b) In the event an agreement or subgrant is cancelled, in whole or 
in part, the grantee may be required to develop procedures for ensuring 
continuity of service to participants.
    (c) Grantees are authorized to enter into classroom training or on-
the-job training contracts or subgrants which extend past the expiration 
date of the grant, but such extension shall not exceed six months. In 
such cases, the grantee shall continue to be responsible for the 
administration of such contracts and subgrants, unless, should the grant 
be terminated, such contract or subgrant is transferred to a successor 
grantee.



Sec.  633.313  Administrative staff and personnel standards.

    The following provisions shall be applicable only to private 
nonprofit grantees and to private nonprofit subgrantees receiving 
section 402 funds:
    (a) Personnel policies of grantees and subgrantees shall be stated 
in written form and available to the Department upon request.
    (b) Each grantee and subgrantee shall insure that its staff 
recruiting procedures afford adequate opportunity for the hiring and 
promotion of persons in the target population.
    (c) Grantees and subgrantees shall include the following provisions 
in their published personnel policies relating to outside employment of 
their employees in section 402 programs.
    (1) Such employment shall not interfere with the efficient 
performance of the employee's duties in the DOL-assisted programs;
    (2) Such employment shall not involve conflict of interest or 
conflict with the employee's duties in the DOL-assisted program;
    (3) Such employment shall not involve the performance of duties 
which the employee should perform as part of employment in the DOL-
assisted program; and
    (4) Such employment shall not occur during the employee's regular or 
assigned working hours in the DOL-assisted program, unless the employee 
during the entire day on which such employment occurs is on annual 
leave, compensatory leave, or leave without pay.
    (d) Salaries and wages. (1) Administrative and staff employees in 
section 402 programs shall be paid at a rate no lower than the 
applicable Federal, State, or local minimum wage rate, whichever is 
highest. The salary for each position shall be justified and documented 
by the grantee to the satisfaction of the Department.
    (2) Notwithstanding paragraph (d)(1) of this section, where a 
grantee or subgrantee has an established system, it may compensate its 
section 402 program employees at existing rates in effect for comparable 
positions under such merit system. However, in order to use this 
methodology, the section 402 program employees must be filling types of 
positions in existence before the grantee or subgrantee received 
financial assistance under the section 402 program, and the salary scale 
must not have been changed as a result of such financial assistance.
    (e) Prorating salaries. Where an individual performs functions under 
several grants, his or her time shall be prorated among the different 
grants and the portion of the salary charged to the section 402 grant 
shall not exceed the percentage of time spent performing section 402 
functions.
    (f) Employee benefits. Employee benefits shall be at the same level 
and to the same extent as those positions in public or private nonprofit 
agencies in the area where the program is carried out.
    (g) Position responsibilities. (1) Each grantee and subgrantee shall 
maintain a written detailed job description identifying job functions 
and responsibilities for each administrative and staff position under 
its section 402 program.
    (2) Each position shall have specific hiring qualifications. 
Positions requiring higher salaries or wages shall include higher level 
of responsibilities commensurate with the salary.
    (h) Personnel procedures. (1) Each grantee and subgrantee shall 
maintain a personnel manual containing detailed procedures for hiring 
new employees, promoting present employees and granting salary 
increases.

[[Page 315]]

    (2) Each grantee and subgrantee shall maintain documentation as to 
any personnel action (including hiring, promotion, and salary increases) 
involving its section 402 program employees.



Sec.  633.314  Reports required.

    Grantees shall report pursuant to instructions issued by the 
Department. Reports shall be submitted quarterly within 45 days after 
the end of the report period (sec. 165(a)(2)). Accuracy of all reports 
must be verified by the chief executive officer or financial officer. 
When estimates are used, the verification statement will so state.



Sec.  633.315  Replacement, corrective action, termination.

    (a) The Department may replace any grantee who during the grant 
period has been terminated by first offering the Governor the 
opportunity to submit an acceptable application. When such an offer is 
made and should the Governor decline, within 15 days, or should the 
Governor or his agent have been the terminated grantee, the Department 
may replace the grantee by (1) designating another organization or 
organizations, or (2) opening the area for competitive bidding.
    (b) The Department may also require appropriate corrective action as 
a condition of continued funding of a grantee whose performance has been 
found deficient, but not sufficient to warrant termination for cause or 
emergency treatment. Such appropriate corrective actions may include but 
are not limited to termination of subrecipient agreements, development 
of and compliance with corrective action plans, etc.
    (c) In cases where deficiencies are identified and efforts at 
corrective action have failed, the Department may apply sanctions, e.g., 
suspension of Letter of Credit, incremental funding, etc.
    (d) Termination for cause can occur whenever there is a violation of 
the governing rules and regulations, failure to comply with the grant 
terms and conditions and in such cases as:
    (1) Inability to meet Federal standards related to such debt 
collection requirements as:
    (i) Failure to respond to demand letters from DOL for repayment of 
debts within the stated timeframe;
    (ii) Failure to comply with approved repayment agreement;
    (2) Nonperformance related to such requirements as:
    (i) Failure to submit required quarterly financial reports for two 
successive periods within 30 days after they are due;
    (ii) Failure to submit required quarterly performance report for two 
successive periods within 30 days after they are due;
    (iii) Failure to develop a plan of action to correct deficiencies 
identified in a final audit finding and determination or by an onsite 
monitoring review;
    (3) Nonperformance related to such requirements as:
    (i) Failure to comply with formal corrective action after due 
notice;
    (ii) Failure to comply with the requirements of the Act related to a 
grievance procedure and other requirements;
    (e) In addition, the Department, by written notice, may terminate a 
grant in whole or in part in the event of reduction in the funds 
available for JTPA title IV, section 402 programs by reason of 
congressional action, whether by authorization, appropriation, deferral, 
rescission or otherwise, or by reason of other legislative action, such 
as changes in service deliverers, program content or services to be 
provided, which makes it impracticable to continue the agreement under 
its original terms. In the event of a congressional reduction in funds, 
the reduction shall be apportioned on an equitable basis among section 
402 grantees. In the case of termination pursuant to this provision, the 
Department shall be liable for payment, in accordance with the payment 
provisions of this agreement, for services rendered and noncancellable 
obligations properly incurred prior to the effective date of 
termination.
    (f) Notwithstanding the provisions of part 636 the Department may 
terminate a grantee under emergency termination procedures in accordance 
with section 164(f) of the Act.
    (i) Instances under which emergency termination can occur include 
but are not limited to: Final audit findings and

[[Page 316]]

determinations identifying numerous adverse findings in the area of 
financial management; information gathered through onsite monitoring 
which substantiates serious management, fiscal and/or performance 
problems; documented information from the Inspector General or gained 
through incident reports of poor performance, serious administrative 
problems and/or inability to protect and account for Federal funds.
    (ii) Within 30 days of written termination notification to a 
grantee, the Department will secure applicable documents onsite, seize 
bank accounts relating to the program, arrange for the payment of 
legitimate bills and debts and arrange, to the degree feasible, for the 
continued provision of services to program enrollees.



Sec.  633.316  Closeout procedures.

    Grant closeout will conform to the requirements at 41 CFR part 29-
70. As necessary, the Department shall issue supplementary closeout 
requirements.



Sec.  633.317  Reallocation of funds.

    (a) In a limited number of circumstances, the Department may reduce 
a portion of a grant when it can be reasonably projected that the funds 
will not be used during the grant performance period or that they will 
not be used for DOL authorized carryover purposes. Such reduction of 
funds will only be undertaken after 30-days advance notice to the 
grantee.
    (b) Funds recaptured as a result of these grant reductions will be 
available for technical assistance or special projects funded at the 
discretion of the Department .



Sec.  633.318  Nondiscrimination and nonsectarian activities.

    Pursuant to section 167(a) of the Act:
    (a) Nondiscrimination and equal opportunity requirements and 
procedures, including complaint processing and compliance reviews, will 
be governed by the provisions of 29 CFR parts 31 and 32 and will be 
administered by the Office of Civil Rights.
    (b) The employment or training of participants in sectarian 
activities is prohibited.



Sec.  633.319  Lobbying, political activities and unionization.

    No funds provided under the Act may be used in any way:
    (a) To attempt to influence in any manner a member of Congress to 
favor or oppose any legislation or appropriation by Congress.
    (b) To attempt to influence in any manner State or local legislators 
to favor or oppose any legislation or appropriation by such legislators.
    (c) Which involves political activities (sec. 141(a)).
    (d) Which will assist, promote, or deter union organizing (sec. 
143(c)(1)).



Sec.  633.320  Nepotism.

    (a) No grantee, subgrantee, or employing agency may hire a person in 
an administrative capacity, staff position, or on-the-job training 
position funded under the Act if a member of that person's immediate 
family is engaged in an administrative capacity for that grantee, 
subgrantee, or employing agency.
    (b) No subgrantee or employing agency may hire a person in an 
administrative capacity, staff position or on-the-job training position 
funded under the Act, if a member of that person's immediate family is 
engaged in an administrative capacity for the grantee from which that 
subgrantee or employing agency obtains its funds. To the extent that an 
applicable State or local legal requirement regarding nepotism is more 
restrictive than this provision, such State or local requirement shall 
be followed.
    (c) For purposes of this section the term ``immediate family'' means 
wife, husband, son, daughter, mother, father, brother, brother-in-law, 
sister, sister-in-law, son-in-law, daughter-in-law, mother-in-law, 
father-in-law, aunt, uncle, niece, nephew, stepparent, and stepchild.



Sec.  633.321  Performance standards for section 402 programs.

    (a) The Secretary shall issue performance standards for section 402 
programs.
    (b) To issue performance standards, the Secretary shall:
    (1) Select the measures against which the standards will be set.

[[Page 317]]

    (2) Prescribe the pre- and post-program measurement periods.
    (3) Determine standards for each of the measures, from which 
specific grantee standards can be determined in accordance with the 
parameters established by the Secretary.
    (c) No grantee shall be penalized for not meeting performance 
standards for the program years 1984-1986.



Sec.  633.322  Sanctions for violation of the Act.

    (a) Pursuant to sections 164 (d), (e), (f), (g), and (h) of the Act, 
the Secretary may impose appropriate sanctions and corrective actions 
for violations of the Act, regulations, or grant terms and conditions. 
Additionally, sanctions may include the following:
    (1) Offsetting debts, arising from misexpenditure of grant funds, 
against amounts to which the grantee is or may be entitled under the 
Act, except as provided in section (e)(1) of the Act. The debt shall be 
fully satisfied when the Secretary reduces amounts allotted to the 
grantee by the amount of the misexpenditure; and
    (2) Determining the amount of Federal cash maintained by the grantee 
or its subgrantee or contractor in excess of reasonable grant needs, 
establishing a debt for the amount of such excessive cash, and charging 
interest on that debt.
    (b) Except for actions under section 164(f) and 167 of the Act, to 
establish a debt or violation subject to sanction and/or corrective 
action, the Secretary shall utilize initial and final determination 
procedures outlined in 20 CFR part 636.
    (c) To impose a sanction or corrective action regarding a violation 
of section 167 of the Act, the Secretary shall utilize the procedures of 
29 CFR part 31.
    (d)(1) The Secretary shall hold the grantee responsible for all 
funds under the grant. The grantee shall hold its subgrantees and 
contractors responsible for JTPA funds received through the grant.
    (2) The Secretary shall determine the liability of the grantee for 
misexpenditures of grant funds in accordance with section 164(e) of the 
Act, including the requirement that the grantee shall have taken prompt 
and appropriate corrective actions for misexpenditures by a subgrantee 
or contractor.
    (3) Prompt, appropriate, and aggressive debt collection action to 
recover any funds misspent by subgrantees or contractors ordinarily 
shall be considered a part of the corrective action required by section 
164(e)(2)(D) of the Act.
    (4) In making the determination required by section 164(e)(2) of the 
Act, the Secretary may determine, based on a request from the grantee, 
that the grantee may forego certain collection actions against a 
subgrantee or contractor where that subgrantee or contractor was not at 
fault with respect to the liability criteria set forth in section 
164(e)(2)(A) through section 164(e)(2)(D) of the Act. The Secretary 
shall consider such requests in assessing whether the grantee's 
corrective action was appropriate in light of section 164(e)(2)(D) of 
the Act.
    (5) The grantee shall not be released from liability for misspent 
funds under the determination required by section 164(e) of the Act 
until the Secretary determines that further collection action, either by 
the grantee or subgrantee or contractor, would be inappropriate or would 
prove futile.
    (e) Nothing in this section shall preclude the Secretary from 
imposing a sanction directly against a subgrantee or contractor as 
authorized in section 164(e)(3) of the Act. In such a case, the 
Secretary shall inform the grantee of the Secretary's action.



PART 634_LABOR MARKET INFORMATION PROGRAMS UNDER TITLE IV, PART E OF
THE JOB TRAINING PARTNERSHIP ACT--Table of Contents



              Comprehensive Labor Market Information System

Sec.
634.1 General.
634.2 Availability of funds.
634.3 Eligible recipients.
634.4 Statistical standards.
634.5 Federal oversight.

    Authority: Job Training Partnership Act, sec. 169, (29 U.S.C. 1510 
et seq., Pub. L. 97-300, 96 Stat. 1322), unless otherwise noted.

[[Page 318]]


    Source: 48 FR 48779, Oct. 20, 1983, unless otherwise noted.

              Comprehensive Labor Market Information System



Sec.  634.1  General.

    Pursuant to title IV, part E of the Job Training Partnership Act, 
the Secretary, in cooperation with the States, shall maintain a 
comprehensive system of Labor Market Information (LMI). This subpart 
contains regulations governing the comprehensive LMI system.



Sec.  634.2  Availability of funds.

    (a) The Secretary shall make available, from the amounts 
appropriated pursuant to section 461(a) of the Act and sections 3(a) and 
14 of the Wagner-Peyser Act, funds to support LMI activities and 
Federal-State cooperative statistical programs.
    (b) LMI programs may be funded through reimbursable agreements 
between the Secretary and the States.



Sec.  634.3  Eligible recipients.

    (a) For funds appropriated pursuant to JTPA title IV, part E, 
eligible recipients shall be the 50 States, the District of Columbia, 
the Commonwealth of Puerto Rico, the Virgin Islands, Guam, the Northern 
Mariana Islands, American Samoa, and the Trust Territory of the Pacific 
Islands.
    (b) For funds appropriated pursuant to the Wagner-Peyser Act, as 
amended, eligible recipients shall be the 50 States, the District of 
Columbia, the Commonwealth of Puerto Rico, Guam, and the Virgin Islands.



Sec.  634.4  Statistical standards.

    Recipients shall agree to provide required data following the 
statistical standards prescribed by the Bureau of Labor Statistics for 
cooperative statistical programs.



Sec.  634.5  Federal oversight.

    The Secretary shall take such action as necessary to ensure 
satisfactory recipient performance.



PART 636_COMPLAINTS, INVESTIGATIONS AND HEARINGS--Table of Contents



Sec.
636.1 Scope and purpose.
636.2 Protection of informants.
636.3 Complaint and hearing procedures at the grantee level.
636.4 Grievance procedures at the employer level.
636.5 Exhaustion of grantee level procedure.
636.6 Complaints and investigations at the Federal level.
636.7 Subpoenas.
636.8 Initial and final determination; request for hearing at the 
          Federal level.
636.9 Opportunity for informal review.
636.10 Hearings before the Office of Administrative Law Judges.
636.11 Final action.

    Authority: 29 U.S.C. 1579(a).

    Source: 48 FR 48780, Oct. 20, 1983, unless otherwise noted.



Sec.  636.1  Scope and purpose.

    (a) General. This part establishes the procedures to receive, 
investigate and resolve complaints, and conduct hearings to adjudicate 
disputes under title IV (except part B) of the Act. It governs grievance 
procedures at the recipient or subrecipient level, the receipt and 
investigation of complaints at the Federal level, the procedures for 
resolving investigative findings, the rules of practice for adjudicative 
hearings, and the rendering of decisions pursuant to the Act. Judicial 
review of final action of the Department after opportunity for an 
administrative hearing has been exclusively established in the United 
States Courts of Appeals for the Circuits in which the affected parties 
reside or transact business.
    (b) Initiation of investigations. JTPA investigations may be 
initiated upon the request of any person or organization or by the 
Department on its own initiative.
    (c) Non-JTPA remedies. Whenever any person, organization or agency 
believes that a recipient or subrecipient has engaged in conduct that 
violates the Act and that such conduct also violates a Federal statute 
other than JTPA, or a State or local law, that person, organization or 
agency may, with respect to

[[Page 319]]

the non-JTPA cause of action, institute a civil action or pursue other 
remedies authorized under other Federal, State, or local law against the 
recipient or subrecipient without first exhausting the remedies in this 
subpart. For example, if a subrecipient believes that a grantee has 
breached the subgrant agreement between the grantee and itself, the 
subrecipient may institute a civil action for breach of contract in a 
State court if so authorized by State law. Nothing in the Act or this 
paragraph, shall:
    (1) Allow any person or organization to join or sue the Secretary 
with respect to his or her responsibilities under JTPA except after 
exhausting the remedies in this subpart.
    (2) Allow any person or organization to file a suit which alleges a 
violation of JTPA or these regulations without first exhausting the 
administrative remedies described in this subpart, or
    (3) Be construed to create a private right of action with respect to 
alleged violations of JTPA or the regulations.
    (d) Complaints of discrimination pursuant to section 167(a) of the 
Act will be handled under 29 CFR parts 31 and 32.

[48 FR 48780, Oct. 20, 1983, as amended at 55 FR 13007, Apr. 6, 1990]



Sec.  636.2  Protection of informants.

    (a) Informants. Where possible the identity of any person who has 
furnished information relating to, or assisted in an investigation of a 
possible violation of the Act will be held in confidence. Where 
disclosure of the person's identity is essential to assure a fair 
determination of the issues, or where necessary to effectively 
accomplish responsibilities under the Act, the Department may disclose 
such identity upon such conditions as will promote the continued receipt 
of confidential information by the Department and effectuate the 
protections and policies stated in paragraph (b) of this section. Any 
such disclosure shall be consistent with the Freedom of Information Act, 
the Privacy Act and other applicable law.
    (b) Retaliation prohibited. No person or agency may discharge, or in 
any other manner discriminate or retaliate against any person, or deny 
to any person a benefit to which that person is entitled under the 
provisions of the Act or the regulations because such person has filed 
any complaint, instituted or caused to be instituted any proceeding 
under or related to the Act, has testified or is about to testify in any 
such proceeding or investigation, or has provided information or 
assisted in an investigation.



Sec.  636.3  Complaint and hearing procedures at the grantee level.

    (a) Policy. (1) Each grantee shall establish and maintain a 
procedure for resolving any complaint alleging a violation of the Act, 
regulations, grant or other agreements under the Act, including any 
complaint arising in connection with the JTPA programs operated by the 
grantee or its subrecipients. Such complaint procedures must meet the 
requirements of this section. The complaint procedure shall provide for 
final resolution of complaints within 60 days after filing the 
complaint. Where existing complaints or grievance procedures include the 
elements set forth in this section, grantees may adopt such mechanism 
as, or as part of, their JTPA procedure.
    (2) Participants shall be provided, upon enrollment into employment 
or training, with a written description of the complaint procedures 
including notification of their right to file a complaint and 
instructions on how to do so. Grantees should designate an individual to 
monitor the operation of the complaint procedures, to ensure that 
complaints and related correspondence are logged and filed, to ensure 
that assistance is available for properly filling complaints, and to 
ensure the availability, coordination, and promptness of all elements of 
the procedures. Upon filing a complaint, and at each stage thereafter, 
each complaint shall be notified in writing of the next step in the 
procedure.
    (3) Complaints may be brought by any individual or organization 
including, but not limited to, program participants, subrecipients, 
contractors, staff of the grantee or subrecipient, applicants for 
participation or financial assistance, labor unions, and community-based 
organizations.

[[Page 320]]

    (4) With the exception of complaints alleging fraud or criminal 
activity, the filing of a complaint pursuant to this section must be 
made within one year of the alleged occurrence.
    (5) The grantee may delegate the authority to operate and maintain 
the complaint and hearing procedure to its subrecipients except for 
complaints between the grantee and its subrecipients (e.g., audit 
disallowances), complaints involving more than one of its subrecipients, 
or complaints directly involving the operations or responsibilities of 
the grantee. Where the procedure is delegated, the grantee may provide 
for an appeal to itself from the decision of the subrecipient or the 
grantee may provide that the subrecipient's decision is the final 
decision of the grantee. Where the procedure is delegated, the grantee 
shall ensure that the procedures specified in this section are followed 
and a decision issued promptly within 60 days after a complaint is 
filed.
    (6) When a participant is an employee of a grantee or subrecipient 
and alleges that an occurrence constitutes a violation of the Act, 
regulations, grant, or other agreements under the Act, as well as a 
violation of the terms and conditions of employment under a State or 
local law or a collective bargaining agreement, the participant may 
pursue the complaint and hearing procedures under the State or local law 
or the collective bargaining agreement, pursuant toSec. 636.4. A 
participant who selects the procedures provided in this section is not 
precluded from filing a complaint underSec. 636.4, unless otherwise 
prohibited by State or local law, or applicable collective bargaining 
agreement.
    (b) Complaint procedures. The complaint resolution procedure shall 
include:
    (1) Opportunity to file a complaint. All complaints shall be in 
writing.
    (2) Opportunity for informal resolution of the complaint.
    (3) Written notification of an opportunity for a hearing when an 
informal resolution has not been accomplished. The notice shall state 
the procedures for requesting a hearing and shall describe the elements 
in the hearing procedures including those set forth in paragraph (c) of 
this section.
    (4) Opportunity to amend the complaint prior to a hearing.
    (5) Opportunity for a hearing pursuant to paragraph (c) of this 
section within 30 days of filing the complaint.
    (6) A final written decision to the complainant which shall be made 
within 60 days of the filing of the complaint and provided to the 
parties by certified or registered mail, return receipt requested. The 
decision shall include:
    (i) A statement of facts and reason(s) for the decision.
    (ii) A statement that the procedures delineated in this section have 
been completed.
    (iii) A statement of any remedies to be applied.
    (iv) Notice of the right to file a complaint with the Grant Officer 
pursuant toSec. 636.6 where any party disagrees with the decision.
    (c) Hearing procedure. A hearing shall be provided within 30 days 
after filing a complaint. The hearing procedure shall include:
    (1) Written notice of the date, time and place of the hearing, the 
manner in which it will be conducted, and the issues to be decided. 
Other interested parties may apply for notice. Such other interested 
party is a person or organization potentially affected by the outcome. 
The notice to other interested parties shall include the same 
information furnished to the complainant and shall further state whether 
such interested parties may participate in the hearing and if 
applicable, the method by which they may request such participation.
    (2) Opportunity to withdraw the request for hearing in writing 
before the hearing.
    (3) Opportunity to request rescheduling of the hearing for good 
cause.
    (4) Opportunity to be represented by an attorney or other 
representative of the complainant's choice.
    (5) Opportunity to call witnesses and introduce documentary 
evidence. Recipients or subrecipients shall cooperate in making 
available any persons under their control or employ to testify, if such 
persons are requested to testify by the complainant.

[[Page 321]]

    (6) Opportunity to have records or documents relevant to the issues 
produced by their custodian when such records or documents are kept by 
or for the grantee or its subrecipient in the ordinary course of 
business.
    (7) Opportunity to question any witnesses or parties.
    (8) The right to an impartial hearing officer.
    (9) A verbatim record of the proceeding.
    (10) A written decision from the hearing officer to the 
complainant(s) and any other interested parties within 60 days of the 
filing of the complaint. This period may be extended with the written 
consent of all of the parties for good cause. The written decision shall 
include a statement of facts, a statement of reasons for the decision 
and a statement of any remedies to be applied. Where the hearing 
officer's decision is the grantee's final decision it shall be provided 
to the parties by certified or registered mail, return receipt 
requested.
    (11) Where a complaint procedure provides for a grantee's review of 
the hearing officer's decision, the grantee shall complete its review 
and provide a final written decision to the complainant(s), and any 
other parties, by certified or registered mail, return receipt 
requested, as provided in paragraph (c)(10) of this section within 60 
days after the complaint is filed.
    (12) Where local law, personnel rules or other applicable 
requirements specify procedures in addition to those specified above, 
similarly employed JTPA participants shall be notified of their right to 
use the same procedures.



Sec.  636.4  Grievance procedures at the employer level.

    (a) Policy. (1) Whenever the grantee or subrecipient is an employer, 
it shall continue to operate or shall establish and maintain for its 
participants a grievance procedure relating to the terms and conditions 
of JTPA employment. The employer who does not have a grievance procedure 
may use the complaint procedure established underSec. 636.3. Employers 
shall inform participants of the procedures they are to follow.
    (2) A participant who elects the grievance procedure in this 
section, may also pursue a complaint underSec. 636.3 where there is an 
alleged violation of the Act, regulations, grant or other agreement 
under the Act.
    (b) Equal benefits. Where local law, personnel rules, or other 
applicable requirements specify procedures (including procedures for any 
adverse action or for termination of employment), similarly employed 
JTPA participants shall be notified of their right to use the same 
procedures, as well as JTPA procedures.



Sec.  636.5  Exhaustion of grantee level procedure.

    (a) Exhaustion required. No complainant may file a complaint with 
the Department until the grantee level procedures specified inSec. 
636.3 have been exhausted.
    (b) Exhaustion exceptions. Complainants who have not exhausted the 
procedures at the grantee level may file the complaint at the Federal 
level, and the Department may accept such complaint if it determines 
that:
    (1) The grantee or subrecipient has not acted within the time frames 
specified inSec. 636.3; or
    (2) The grantee's or subrecipient's procedures are not in compliance 
withSec. 636.3; or
    (3) An emergency situation exists.



Sec.  636.6  Complaints and investigations at the Federal level.

    (a) General; final determination of reliable and probative evidence. 
Where local administrative remedies have been exhausted, section 144(c) 
of the Act requires that a final determination of the complaint shall be 
made within 120 days after the Department receives the complaint. The 
Department's resolution of non-criminal matters pursuant to section 
144(c) of the Act consists of the final determination underSec. 
636.8(e) of whether there is reliable and probative evidence to support 
the allegation or belief that a grantee or subrecipient is failing to 
comply with the requirements of the Act, regulations, grant or other 
agreement under the Act.

[[Page 322]]

    (b) Complaints. (1) Every complaint shall be filed in writing before 
the commencement of any investigation or corrective action shall be 
required. Complaints alleging discrimination under section 167, will be 
filed with the Regional Director, Office of Civil Rights (OCR). All 
other JTPA complaints will be filed with the appropriate Grant Officer. 
However, a complaint timely filed with either the Grant Officer or the 
Regional OCR Director shall be deemed properly filed and shall be 
referred (as necessary) to the appropriate office. The complaint shall 
be filed only after the grantee level procedures inSec. 636.3 have 
been exhausted and no later than 30 days from the date of receipt of the 
written decision or notice required bySec. 636.3. The complaint should 
contain the following:
    (i) The full name, telephone number (if any), and address of the 
person making the complaint.
    (ii) The full name and address of the respondent (the grantee or 
subrecipient or person against whom the complaint is made).
    (iii) A clear and concise statement of the facts, including 
pertinent dates, constituting the alleged violation.
    (iv) Where known, the provisions of the Act, regulations, grant or 
other agreements under the Act believed to have been violated.
    (v) A statement disclosing whether proceedings involving the subject 
of the complaint have been commenced or concluded before any Federal, 
State or local authority, and, if so, the date of such commencement or 
conclusion, the name and address of the authority and the style of the 
case.
    (vi) A copy of the final decision of the recipient or subrecipient 
issued pursuant toSec. 636.3.
    (2) A complaint will be considered to have been received upon 
receipt by the appropriate Grant Officer. To be acceptable, the 
complaint must be a written statement sufficiently precise to both 
identify those against whom the allegations are made and to fairly 
afford the respondent an opportunity to prepare a defense. A complaint 
may be amended to cure defects or omissions, or to clarify and amplify 
allegations made therein, and such amendments relate back to the 
original filing date for purposes of timely filing.
    (3) A complaint once filed may be withdrawn only with the consent of 
the Grant Officer. If the complainant fails to cooperate or is 
unavailable, the complaint may be dismissed upon reasonable notice to 
the last known address of the complainant.
    (c) Investigation of complaints. Whenever the Grant Officer receives 
a complaint filed in accordance with paragraphs (a) and (b) of this 
section, the complaint shall be investigated if it alleges that any 
person, grantee or subrecipient has failed to comply with the 
requirements of the Act, regulations, grant or other agreements under 
the Act. The Grant Officer shall promptly issue a notice to the grantee 
or subrecipient which shall include a copy or summary of the complaint 
and which shall direct the grantee or subrecipient to forward a copy of 
the complete administrative file, including a copy of the certified 
verbatim transcript of the hearing, within 15 days of receipt of such 
notice to the Grant Officer. Such investigation shall be completed and a 
conclusion made pursuant toSec. 636.8(e) within 120 days of the filing 
of the complaint, except that the time may be extended with the written 
consent of all the parties.
    (d) Onsite review and other bases for investigation. If after an 
onsite review, monitoring visit, review of reports, data or other 
information, the Grant Officer has reason to believe that a grantee or 
subrecipient is failing to comply with the requirements of the Act, 
regulations, grant or other agreements under the Act, the Grant Officer 
or other designated authority shall inquire into the matter.
    (e) Utilizing other services. With the consent and cooperation of 
State agencies charged with the administration or enforcement of State 
laws, the Secretary may elect for the purpose of carrying out this part, 
to utilize the services of State, local and Tribal agencies and their 
employees, and notwithstanding any other provision of law, may 
reimburse, in whole or in part, such State and local agencies and their 
employees for services rendered for such purposes.

[[Page 323]]

    (f) Criminal investigation. Notwithstanding any other provision of 
this part, investigation by the Department of any matter concerning a 
potential Federal criminal violation shall be conducted as the Inspector 
General shall direct pursuant to the powers granted by the Inspector 
General Act of 1978, Pub. L. 95-452, 92 Stat. 1101.



Sec.  636.7  Subpoenas.

    (a) Subpoenas in non-Inspector General investigations. (1) The 
Department, through the appropriate Assistant Secretary, may issue a 
subpoena directing the person named therein to appear before a 
designated representative at a designated time and place to verify or to 
produce documentary evidence, or both, relating to any matter arising 
under the Act being investigated. The Assistant Secretary, Solicitor or 
the Associate Solicitor for Employment and Training Legal Services, for 
good cause shown, may extend the time prescribed for compliance with 
such subpoenas.
    (2) Any motion to limit or quash any investigational subpoena shall 
be filed with the Chief Administrative Law Judge within 10 days after 
service of the subpoena, or, if the return date is less than 10 days 
after service of the subpoena, within such other time as may be allowed 
by the assigned Administrative Law Judge.
    (3) The timely filing of a motion to limit or quash an 
investigational subpoena shall stay the requirement of a return on the 
portion challenged. If the Administrative Law Judge rules subsequent to 
the return date, and the ruling denies the motion in whole or in part, 
the Administrative Law Judge shall specify a new return date.
    (4) All motions to limit or quash subpoenas, and the responses 
thereto, shall be part of the public record of the Office of the 
Administrative Law Judges except as otherwise ordered or provided under 
these regulations.
    (b) Noncompliance. (1) In cases of failure to comply with compulsory 
processes, appropriate action may be initiated including actions for 
enforcement, forfeiture, penalties or criminal actions.
    (2) The Solicitor of Labor, with the consent of the Attorney 
General, may:
    (i) Institute in the appropriate district court on behalf of the 
Department an enforcement proceeding in connection with the failure or 
refusal of a person, partnership, corporation, recipient or other entity 
to comply with or to obey a subpoena if the return date or any extension 
thereof has passed; or
    (ii) Request on behalf of the Department the institution of civil 
actions, as appropriate, if the return date or any extension thereof has 
passed including seeking civil contempt in cases where a court order 
enforcing compulsory process has been violated.



Sec.  636.8  Initial and final determination; request for hearing at
the Federal level.

    (a) Initial determination. Upon the conclusion of a review of the 
entire administrative record of an investigation conducted pursuant to 
Sec.  636.6 or after the conclusion of the comment period for audits, 
the Grant Officer shall make an initial determination of the matter in 
controversy including the allowability of questioned costs or 
activities. Such determination shall be based upon the requirements of 
the Act, regulations, grants or other agreements, under the Act. The 
determination may conclude either:
    (1) That based upon the entire record there is no violation of the 
Act, regulations, grants or other agreements under the Act; or
    (2) That there is evidence to support the allegation, or finding of 
questioned costs or activities.
    (b) Contents of initial determination. (1) In the event that the 
Grant Officer makes a finding that there is evidence to support the 
allegation of a violation the initial determination shall:
    (i) Be in writing;
    (ii) State the basis of the determination, including factual 
findings and conclusions;
    (iii) Specify the costs or activities disallowed;
    (iv) Specify the corrective actions required and/or that sanctions 
may be imposed; and
    (v) Give notice of an opportunity for informal resolution of the 
matters as necessary to the appropriate parties, which should include 
all interested parties specified by the Grant Officer.

[[Page 324]]

    (2) In the event that the Grant Officer makes a finding of no 
violation the initial determination shall:
    (i) Be in writing;
    (ii) State the bases of the determination (factual findings and 
conclusions); and
    (iii) Give notice of the opportunity to present additional 
information within 30 days of receipt of the initial determination.
    (3) The initial determination shall be mailed by certified mail 
return receipt requested to the parties and interested parties.
    (c) Allowability of certain questioned costs. In any case in which 
the Grant Officer determines that the recipient meets the requirements 
of section 164(e)(2)(A)-(D) of the Act, the Grant Officer may waive the 
imposition of sanctions (sec. 164(e)(3)). It is the responsibility of 
the grantee to request such waiver by the Grant Officer and to submit 
the evidence to be used to make the finding.
    (d) Informal resolution. Except as provided by section 164(f) of the 
Act, the Grant Officer shall not revoke a grant, in whole or in part, 
nor institute corrective action or sanctions against a grantee without 
first providing the grantee with an opportunity to informally resolve 
those matters contained in the Grant Officer's initial determination. If 
all matters are informally resolved, the Grant Officer shall notify the 
parties in writing of the nature of the resolution, which shall 
constitute final agency action, not subject to appeal, and shall close 
the file.
    (e) Final determination. (1) If all the parties and the Grant 
Officer cannot informally resolve any matter pursuant to paragraph (d) 
of this section, the Grant Officer shall provide each party with a final 
written determination by certified mail, return receipt requested. In 
the case of audits, the final determination shall be issued not later 
than 180 days after the receipt by the Grant Officer of the final 
approved audit report.
    (2) The final determination shall:
    (i) Indicate that efforts to informally resolve matters contained in 
the initial determination pursuant to paragraph (a) of this section have 
been unsuccessful;
    (ii) List those matters upon which the parties continue to disagree;
    (iii) List any modifications to the factual findings and conclusions 
set in the initial determination;
    (iv) List any sanctions, and required corrective actions, including 
any other alteration or modification of the plan, grant, agreement or 
program ordered by the Grant Officer; and
    (v) Inform the parties of their opportunity to request a hearing 
pursuant to these regulations.
    (3) If it is determined in the final notice that the complaint does 
not allege and/or the evidence does not indicate that there is reason to 
believe there may have been a violation of the Act, regulations, grants 
or other agreements under the Act, the Grant Officer shall dismiss the 
complaint without an offer of a hearing. Such dismissal shall constitute 
final agency action.



Sec.  636.9  Opportunity for informal review.

    (a) Parties to a complaint underSec. 636.10 may choose to waive 
their rights to an administrative hearing before the Office of 
Administrative Law Judges (OALJ) by choosing to transfer the settlement 
of their dispute to an individual acceptable to all parties for the 
purpose of conducting an informal review of the stipulated facts and 
rendering a decision in accordance with applicable law. A written 
decision will be issued within 60 days after the matter is submitted for 
informal review.
    (b) The waiver of the right to request a hearing before the OALJ 
will automatically be revoked if a settlement has not been reached 
within the 60 days provided in paragraph (a) of this section.
    (c) The decision rendered under this informal review process shall 
be treated as a final decision of an Administrative Law Judge pursuant 
to section 166(b) of the Act.



Sec.  636.10  Hearings before the Office of Administrative Law Judges.

    (a) Jurisdiction. (1) Within 21 days of receipt of the Grant 
Officer's final determination, except for determinations underSec. 
636.8(e)(3) dismissing the complaint without an opportunity to request a 
hearing, or on the expiration of

[[Page 325]]

120 days of the filing of a complaint with the Grant Officer upon which 
no extensions have been mutually agreed, any affected grantee, 
subrecipient of complainant may transmit by certified mail, return 
receipt requested, a request for hearing to the Chief Administrative Law 
Judge, United States Department of Labor, 800 K Street, NW., suite 400, 
Washington, DC 20001-8002 with a copy to the Grant Officer.
    (2) The request for hearing shall be accompanied by a copy of the 
Grant Officer's final determination, if issued, and shall specifically 
state those issues of the determination upon which review is requested. 
Those provisions of the determination not specified for review, or the 
entire determination when no hearing has been requested, shall be 
considered resolved and not subject to further review.
    (3) Except as otherwise provided by these regulations, only alleged 
violations of the Act, regulations, grants or other agreements under the 
Act fairly raised in grantee level proceedings underSec. 636.3, 
alleged violations of recipient level procedures fairly raised before 
the Grant Officer, or complaints identified in sections 164(f) and 
166(a) of the Act are subject to review.
    (4) The same procedure set forth in paragraphs (a) (1) through (3) 
of this section applies in the case of a complainant who has not had a 
dispute adjudicated by the informal review process ofSec. 636.9 within 
the 60 days, except that the request for hearing before the OALJ must be 
filed within 15 days of the conclusion of the 60-day period. In addition 
to including the determination upon which review is requested, the 
complainant must include a copy of any Stipulation of Facts and a brief 
summary of proceedings.
    (5) Discretionary hearing. An opportunity for a hearing may also be 
extended when the appropriate Assistant Secretary determines that 
fairness and the effective operation of JTPA programs would be 
furthered.
    (b) Service and filing. Copies of all papers required to be served 
on a party or filed with the OALJ shall be filed simultaneously with the 
OALJ and served upon the parties of record or their representatives, and 
shall contain proof of such service.
    (c) Rules of Procedure. The rules of practice and procedure 
promulgated by the OALJ shall govern the conduct of hearings under this 
section.
    (d) Prehearing procedures. In all cases, the OALJ should encourage 
the use of prehearing procedures to simplify and clarify facts and 
issues.
    (e) Subpoenas. Subpoenas necessary to secure the attendance of 
witnesses and the production of documents or things at hearings shall be 
obtained from the OALJ and shall be issued pursuant to the authority 
contained in section 163(b) of the Act, incorporating 15 U.S.C. section 
49.
    (f) Timely submission of evidence. The OALJ shall not permit the 
introduction at the hearing of documentation relating to the 
allowability of costs if such documentation has not been made available 
for review either at the time ordered for any prehearing conference, or, 
in the absence of such an order, at least three weeks prior to the 
hearing date.
    (g) Burden of production. The Department shall have the burden of 
production to support the Grant Officer's decision. To this end, the 
Grant Officer shall prepare and file an administrative file in support 
of the decision. Thereafter, the party or parties seeking to overturn 
the Grant Officer's decision shall have the burden of persuasion.
    (h) Review. (1) In all cases proceeding underSec. 636.6, the 
Administrative Law Judge shall review the Administrative File and the 
request for hearing and shall determine whether there has been a full 
and fair hearing at the grantee level and whether there are no material 
factual issues unresolved. If the Administrative Law Judge determines 
that these two conditions are met, the case shall be decided upon the 
record and upon such briefs as the parties may submit. The 
Administrative Law Judge shall determine from the record whether there 
exists reliable and probative evidence to uphold the decision of the 
Grant Officer and shall, as appropriate, either affirm or remand the 
decision.
    (2) If the Administrative Law Judge determines that either of the 
two conditions is not met, he or she shall hold a hearing. In such 
cases, the Office of Administrative Law Judges shall have

[[Page 326]]

the full authority of the Secretary under section 164 of the Act, except 
with respect to the provisions of subsection (e) of that section.
    (3) Nothing in this subsection shall be construed to limit the right 
of the parties to seek a dismissal of the request for hearing or to seek 
summary judgment.
    (i) Termination of grant. When the decision terminates the grant in 
whole or in part after hearing pursuant to this subpart, the decision 
shall specify the extent of termination and the date upon which such 
termination becomes effective. Upon receipt of this notice, the grantee 
shall:
    (1) Discontinue further commitments of grant funds to the extent 
that they relate to the terminated portion of the grant.
    (2) Promptly cancel all subgrants, agreements and contracts 
utilizing funds under this grant to the extent that they relate to the 
terminated portion of the grant.
    (3) Settle, with the approval of the Secretary, all outstanding 
claims arising from such termination.
    (4) Submit, within a reasonable period of time, after the receipt of 
the notice of termination, a termination settlement proposal which shall 
include a final statement of all unreimbursed costs related to the 
terminated portion of the grant.
    (j) Alternative provision of services. If the final decision 
specifies suspension or termination of the grant, the Grant Officer 
shall determine how services shall be maintained in the grantee's area. 
As part of the determination, the Grant Officer shall determine whether 
any funds shall be reallocated to another recipient to serve the area 
formerly served by the terminated or suspended grant. The Grant Officer 
may also consider the desirability of providing direct Federal services 
to the area through appropriate means.
    (k) Timing of decisions. The Office of Administrative Law Judges 
should render a written decision not later than 90 days after the 
closing of the record.

[48 FR 48780, Oct. 20, 1983, as amended at 56 FR 54708, Oct. 22, 1991]



Sec.  636.11  Final action.

    The final decision of the Secretary pursuant to section 166(b) of 
the Act in cases heard by the Administrative Law Judges or decided by an 
informal reviewer, or the Grant Officer's final determination where 
there has been no such hearing, constitutes final agency action within 
the meaning of the Act and the Administrative Procedure Act, 5 U.S.C. 
704.



PART 637_PROGRAMS UNDER TITLE V OF THE JOB TRAINING PARTNERSHIP ACT--
Table of Contents



                      Subpart A_General Provisions

Sec.
637.100 Scope and purpose.
637.105 Definitions.

                Subpart B_Program Planning and Operation

637.200 Allotments to States.
637.205 Notice of intent to participate.
637.210 Incentive bonus program applications.
637.215 Review and approval of applications for incentive bonus 
          payments.
637.220 Eligibility criteria for individuals to be counted in 
          determining incentive bonuses.
637.225 Determination of incentive bonus.
637.230 Use of incentive bonuses.

  Subpart C_Additional Title V Administrative Standards and Procedures

637.300 Management systems, reporting and recordkeeping.
637.305 Federal monitoring and oversight.
637.310 Audits.

Subpart D--Data Collection [Reserved]

    Authority: 29 U.S.C 1579(a); 29 U.S.C. 1791i(e).

    Source: 59 FR 45868, Sept. 2, 1994, unless otherwise noted.



                      Subpart A_General Provisions



Sec.  637.100  Scope and purpose.

    (a) This part implements Title V of the Act which creates a program 
to provide incentive bonuses to States for providing certain employable 
dependent individuals with job training to reduce welfare dependency, to 
promote

[[Page 327]]

self-sufficiency, to increase child support payments, and to increase 
employment and earnings (section 501).
    (b) This part applies to programs operated with funds under Title V 
of the Job Training Partnership Act.



Sec.  637.105  Definitions.

    In addition to the definitions contained in sections 4, 301, 303(e), 
and inSec. 626.4 of this chapter, the following definitions apply to 
the administration of Title V of the Act and this part:
    Absent parent means an individual who is continuously absent from 
the household and who is a non-custodial parent of a dependent child 
receiving aid to families with dependent children (AFDC) under part A of 
title IV of the Social Security Act (42 U.S.C. 601, et seq.).
    Disability assistance means benefits offered pursuant to Title XVI 
of the Social Security Act, relating to the supplemental security income 
program.
    Federal contribution means the amount of the Federal component of 
cash payments to individuals within the participating State under 
welfare and/or disability assistance programs, including Part A of Title 
IV of the Social Security Act.



                Subpart B_Program Planning and Operation



Sec.  637.200  Allotments to States.

    (a) For each program year for which funds are appropriated to carry 
out programs under this part, the Secretary shall pay to each 
participating State the amount the State is eligible to receive in 
accordance with this part. No payments shall be made for any years for 
which funds are not appropriated and/or not available (section 502(a)).
    (b) If the appropriation is not sufficient to pay to each State the 
amount it is eligible to receive in accordance with this part, the State 
shall receive a percentage of the total available funds equal to the 
percentage of its bonus compared to the national total of bonuses 
(section 502(b)).
    (c) If an additional amount is made available after the application 
of paragraph (b) of this section, such additional amount shall be 
allocated among the States by increasing payment in the same manner as 
was used to reduce payment, except that no State shall be paid an amount 
which exceeds the amount to which it is eligible (section 502(c)).



Sec.  637.205  Notice of intent to participate.

    (a) Any State seeking to participate in the incentive bonus program 
shall notify the Secretary of its intent to do so no later than 30 days 
before the beginning of its first program year of participation (i.e., 
June 1) (section 505(a)).
    (b) Pursuant to instructions issued by the Secretary, the 
notification referenced in paragraph (a) of this section shall be in the 
form of a letter from the Governor to the Secretary advising the 
Secretary of the State's intention to apply for, receive and expend 
bonuses under this program in a manner consistent with this part 
(section 505(b)).
    (c) After the State's submission of a notice of intent to 
participate, incentive bonuses may be claimed by a State for any 
individual who:
    (1)(i) Was an absent parent of any child receiving AFDC at the time 
such individual was determined to be eligible for participation in 
programs under the Act;
    (ii) Has participated in education, training, or other activities 
(including the Job Corps) funded under the Act; and
    (iii) Pays child support for a child specified in paragraph (c)(1) 
of this sec-tion following termination from activities funded under the 
Act; or
    (2)(i) Is blind or disabled;
    (ii) Was receiving disability assistance at the time such individual 
was determined to be eligible for participation in programs under the 
Act;
    (iii) Has participated in education, training, or other activities 
(including the Job Corps) funded under the Act; and
    (iv) Earns from employment a wage or an income (section 506).
    (d) A Governor may withdraw the State's participation in the 
incentive bonus program in any program year by submitting a written 
notice of withdrawal.

[[Page 328]]



Sec.  637.210  Incentive bonus program applications.

    (a) Any State seeking to receive an incentive bonus under this title 
shall submit an Incentive Bonus Program application pursuant to 
instructions issued by the Secretary that will contain the criteria for 
approval of such application. Each application shall contain, at a 
minimum, the following information:
    (1) A list of eligible individuals who met the requirements ofSec. 
637.220 of this part during the program year;
    (2) The amount of the incentive bonus attributable to each eligible 
individual who is claimed by the State; and
    (3) A statement certifying the availability of documentation to 
verify the eligibility of participants and the amount of the incentive 
bonus claimed by the State (section 505(b)).
    (b) The application for any program year shall be submitted by the 
State to the Secretary no later than August 31 following the end of the 
program year for which the bonus is being claimed. A copy of such 
application shall also be submitted at the same time to the appropriate 
DOL Employment and Training Administration Regional Office.



Sec.  637.215  Review and approval of applications for incentive bonus
payments.

    (a) The Secretary shall review all applications for overall 
compliance with JTPA, the requirements of this part, and the 
instructions issued by the Secretary.
    (b) The Secretary shall inform a State within 30 days after receipt 
of the application whether or not its application has been approved.
    (c) If the application is not approved, the Department shall issue 
an initial notice of denial of payment indicating the reasons for such 
denial. The Governor will then have 30 days to respond to the reasons 
for the denial before a final decision is made.
    (d) If the Department determines that the additional information 
provided does not adequately respond to the questions raised in the 
initial review process, a final denial of payment shall be issued. The 
Governor may then appeal the decision in accordance with the procedures 
at subpart H of part 627 of this chapter (sections 504(c) and 505(c)).



Sec.  637.220  Eligibility criteria for individuals to be counted in 
determining incentive bonuses.

    An individual shall be eligible to be counted as part of the State's 
request for an incentive bonus payment under this part if the 
individual:
    (a)(1) Was an absent parent of any child receiving AFDC at the time 
such individual was determined to be eligible for participation in 
programs under the Act;
    (2) Has participated in education, training, or other activities 
(including the Job Corps) funded under the Act; and
    (3) Pays child support for a child specified in paragraph (a)(1) of 
this section following termination from activities funded under the Act; 
or
    (b)(1) Is blind or disabled;
    (2) Was receiving disability assistance at the time such individual 
was determined to be eligible for participation in programs under the 
Act;
    (3) Has participated in education, training, or other activities 
(including the Job Corps) funded under the Act; and
    (4) Earns a wage or an income from employment (section 506).



Sec.  637.225  Determination of incentive bonus.

    The amount of the incentive bonus to be paid to each State shall be 
the total of the incentive bonuses claimed for each eligible individual 
within the State. The amount of the incentive bonus to be paid each 
State shall be determined by the sum of:
    (a) An amount equal to the total of the amounts of child support 
paid by each individual who is eligible underSec. 637.220(a) of this 
part, for up to 2 years after such individual's termination from JTPA; 
and
    (b) An amount equal to the total reduction in the Federal 
contribution to the amounts received under title XVI of the Social 
Security Act (42 U.S.C. 1381, et seq.) by each individual who is 
eligible underSec. 637.220(b) of this part, for up to 2 years after 
such individual's termination from JTPA (section 503).

[[Page 329]]



Sec.  637.230  Use of incentive bonuses.

    (a) During any program year, the Governor may use an amount not to 
exceed 5 percent of the State's total bonus payment for the 
administrative costs incurred under this program, including data and 
information collection and compilation, recordkeeping, or the 
preparation of applications for incentive bonuses (section 
504(a)(1)(A)).
    (b) The remainder, not less than 95 percent of the incentive bonuses 
received, shall be distributed to SDAs and Job Corps Centers within the 
State in a manner consistent with an agreement between the Governor and 
these SDA's and centers. This agreement shall reflect an equitable 
method of distribution which is based on the degree to which the effort 
of the SDA and/or Center contributed to the State's qualification for 
incentive bonus funds under title V (section 504(a)(1)(B)).
    (c) Not more than 10 percent of the incentive bonus received in any 
program year by each SDA and/or Job Corps Center may be used for the 
administrative costs of establishing and maintaining systems necessary 
for operation of programs under title V, including the costs of 
providing incentive payments described in paragraph (d) of this section, 
technical assistance, data and information collection and compilation, 
management information systems, post-program followup activities, and 
research and evaluation activities (section 504(a)(2)).
    (d) Each SDA and/or Job Corps Center may make incentive payments to 
service providers, including participating State and local agencies, and 
community-based organizations, that demonstrate effectiveness in 
delivering employment and training services to eligible individuals 
under this title (section 504(b)).
    (e) All remaining funds received by each SDA shall be used for 
activities described in sections 204 and 264 of JTPA and shall be 
subject to the regulations governing the operation of programs under 
titles II-A and II-C of JTPA. All remaining funds received by each Job 
Corps Center shall be used for activities authorized under part B of 
title IV (section 504(a)(2).



  Subpart C_Additional Title V Administrative Standards and Procedures



Sec.  637.300  Management systems, reporting and recordkeeping.

    (a) The Governor shall ensure that the State's financial management 
system and recordkeeping system comply with subpart D of part 627 of 
this chapter.
    (b) Notwithstanding the provisions ofSec. 629.455 of this chapter, 
the Governor shall report to the Secretary pursuant to instructions 
issued by the Secretary regarding activities funded under this part. 
Reports shall be required semi-annually and annually. Reports shall be 
provided to the Secretary within 45 calendar days after the end of the 
report period.
    (c) The Governor shall assure that appropriate and adequate records 
are maintained for the required time period to support all incentive 
bonus payment applications. Such records shall include documentation to 
support individuals' eligibility under this part.



Sec.  637.305  Federal monitoring and oversight.

    The Secretary shall conduct oversight of the programs and activities 
conducted in accordance with this part.



Sec.  637.310  Audits.

    The Governor shall ensure that the State complies with the audit 
provisions atSec. 629.480 of this chapter.

Subpart D--Data Collection [Reserved]



PART 638_JOB CORPS PROGRAM UNDER TITLE IV-B OF THE JOB TRAINING 
PARTNERSHIP ACT--Table of Contents



                       Subpart A_Purpose and Scope

Sec.
638.100 General.

                          Subpart B_Definitions

638.200 Definitions.

[[Page 330]]

      Subpart C_Funding, Site Selection, and Facilities Management

638.300 Eligibility for funds and eligible deliverers.
638.301 Funding procedures.
638.302 Performance measurement.
638.303 Site selection and facilities management.
638.304 Historical preservation.
638.305 Capital improvements.
638.306 Protection and maintenance of contract center facilities owned 
          or leased by Job Corps.
638.307 Facility surveys.

Subpart D_Enrollment, Transfers, Terminations, and Placements in the Job 
                                  Corps

638.400 Eligibility for participation.
638.401 Outreach and screening of participants.
638.402 Enrollment by readmission.
638.403 Selective Service.
638.404 Transfers.
638.405 Extensions of enrollment.
638.406 Federal status of students.
638.407 Terminations.
638.408 Transportation.
638.409 Placement and job development.

                       Subpart E_Center Operations

638.500 Orientation program.
638.501 Student handbook.
638.502 Job Corps basic education program.
638.503 Vocational training.
638.504 Occupational exploration program.
638.505 Scheduling of training.
638.506 Purchase of vocational supplies and equipment.
638.507 Work experience.
638.508 Sale of services or objects.
638.509 Leisure-time employment.
638.510 Health care and services.
638.511 Drug use and abuse.
638.512 Sexual behavior and harassment.
638.513 Death.
638.514 Residential support services.
638.515 Recreation/avocational program.
638.516 Laundry, mail, and telephone service.
638.517 Counseling.
638.518 Intergroup relations program.
638.519 Incentives system.
638.520 Student government and leadership programs.
638.521 Student welfare association.
638.522 Evaluation of student progress.
638.523 Food service.
638.524 Allowances and allotments.
638.525 Clothing.
638.526 Tort and other claims.
638.527 Federal employees' compensation.
638.528 Social Security.
638.529 Income taxes.
638.530 Emergency use of personnel, equipment and facilities.
638.531 Limitation on the use of students in emergency projects.
638.532 Annual leave.
638.533 Other student absences.
638.534 Legal services to students.
638.535 Voting rights.
638.536 Religious rights.
638.537 Disclosure of information.
638.538 Disciplinary procedures and appeals.
638.539 Complaints and disputes.
638.540 Cooperation with agencies and institutions.
638.541 Job Corps training opportunities.
638.542 Child care services.
638.543 Community relations program.

           Subpart F_Applied Vocational Skills Training (VST)

638.600 Applied vocational skills training (VST) through work projects.
638.601 Applied VST budgeting.

      Subpart G_Experimental, Research, and Demonstration Projects

638.700 Experimental, research, and demonstration projects.

                   Subpart H_Administrative Provisions

638.800 Program management.
638.801 Staff training.
638.802 Student records management.
638.803 Safety.
638.804 Environmental health.
638.805 Security and law enforcement.
638.806 Property management and procurement.
638.807 Imprest and petty cash funds.
638.808 Center financial management and reporting.
638.809 Audit.
638.810 Reporting requirements.
638.811 Review and evaluation.
638.812 State and local taxation of Job Corps deliverers.
638.813 Nondiscrimination; nonsectarian activities.
638.814 Lobbying; political activities; unionization.
638.815 Charging fees.

    Authority: 29 U.S.C. 1579(a).

    Source: 55 FR 12996, Apr. 6, 1990, unless otherwise noted.



                       Subpart A_Purpose and Scope



Sec.  638.100  General.

    (a) Purpose and scope. The purpose of this part is to delineate the 
policies, rules, and regulations that govern the operation of the Job 
Corps program,

[[Page 331]]

authorized under title IV-B of the Job Training Partnership Act (Act). 
Job Corps is one of the broad range of programs for youth authorized by 
the Act. Job Corps centers are located in both rural and urban areas and 
provide training, education, residential and a variety of other support 
services necessary to prepare students to become more responsible, 
productive, and employable. (Section 421)
    (b) Job Corps Policy and Requirements Handbook. The policies and 
procedures required in this part which are to be established by the Job 
Corps Director shall be contained in a policy and requirements handbook 
which shall be incorporated by reference in each contract or agreement 
to operate a Job Corps center, program, or entity.
    (c) Definitions. Definitions for terms used in this part are found 
in section 4 of the Act and in subpart B of this part. Statutory 
authority for the regulations in this part is found in section 169(a) of 
the Act (29 U.S.C. 1579(a)). Applicable statutory provisions, including 
sections of the Act other than section 169(a), are noted parenthetically 
in this part.



                          Subpart B_Definitions



Sec.  638.200  Definitions.

    In addition to the definitions contained in section 4 of the Act, 
the following definitions apply to programs under title IV-B of the Act 
and under this part:
    Absent Without Official Leave (AWOL) means the absence of a student 
without official leave. For purposes of tort claims, federal employees' 
compensation, pay status and leave accrual, a residential student is 
considered AWOL if AWOL for 24 continuous hours. A non-resident student 
is considered AWOL if AWOL for one full day of center training.
    Act means the Job Training Partnership Act.
    Allotment means:
    (1) A portion of the readjustment allowance prescribed by this part, 
which portion is paid monthly during the period of service of a student 
directly to a spouse of the student, to the child(ren) of the student, 
or to any other relative of the student who draws substantial support 
from the student; and
    (2) A supplement to the portion allotted by the student, made by the 
payment of an equal amount by DOL. (Section 429(d))
    Allowance means a benefit provided by DOL to students by cash, 
check, credit, voucher, direct provision, or otherwise for such personal 
travel, leave, quarters, subsistence, transportation, equipment, 
clothing, recreational services, and other expenses as the Job Corps 
Director may deem necessary or appropriate to the students' needs. 
(Section 429)
    Capital improvement means any modification, addition, restoration or 
other improvement:
    (1) Which increases the usefulness, productivity, or serviceable 
life of an existing site, facility, building, structure, or major item 
of equipment;
    (2) Which is classified for accounting purposes as a ``fixed 
asset''; and
    (3) The cost of which increases the recorded value of the existing 
building, site, facility, structure, or major item of equipment and is 
subject to depreciation.
    Center means an organizational entity, including all of its 
subparts, providing Job Corps training and designated as a Job Corps 
center by the Job Corps Director.
    Center Director means a center's chief official or the Center 
Director's designee.
    Center operator means an agency or contractor that runs a center 
under an agreement or contract with DOL.
    Center review board means the group at a center consisting of 
representatives from staff and students that reviews charges brought 
against students for infractions of center rules for which the penalty 
of termination might be imposed.
    Civilian Conservation Center (CCC) means a center operated on public 
land under an agreement between DOL and another federal agency, which 
shall provide, in addition to other training and assistance, programs of 
work experience to conserve, develop, or manage public natural resources 
or public recreational areas or to develop community projects in the 
public interest.

[[Page 332]]

    Contract center means a center administered under a contract between 
Job Corps and a corporation, partnership, public agency, or similar 
legal entity.
    Contracting officer means a DOL official authorized to enter into 
contracts or agreements on behalf of DOL.
    Deliverer means any individual or organization that receives federal 
funds directly from DOL to establish, operate, or provide service to any 
Job Corps program or activity.
    Department of Labor (DOL) means the United States Department of 
Labor, including its agencies and organizational units.
    Disruptive home life means a home life characterized by such 
conditions as:
    (1) The youth is living in an orphanage or other protective 
institution;
    (2) The youth is suffering from serious parental or familial neglect 
or abuse; or
    (3) The youth's father, mother, or legal guardian is a chronic 
invalid, alcoholic, narcotics addict, or has any other serious health 
condition.
    Economically disadvantaged means an individual who:
    (1) Receives, or is a member of a family which receives, cash 
welfare payments under a Federal, State, or local welfare program;
    (2) Has, or is a member of a family which has received a total 
income for the 6-month (annualized) period prior to application to the 
program which, in relation to family size or for an individual, was not 
in excess of the higher of:
    (i) The poverty level determined in accordance with criteria 
established by the Department of Health and Human Services; or
    (ii) 70 percent of the lower living standard income level;
    (3) Is receiving (or has been determined within the 6-month period 
prior to the application for the program involved to be eligible to 
receive) food stamps pursuant to the Food Stamp Act of 1977, as 
administered by the U.S. Department of Agriculture;
    (4) Is a foster child on behalf of whom State or local government 
payments are made; or
    (5) Is an individual with handicaps whose own income meets the 
requirements of paragraphs (1) or (2) of this definition, but who may be 
a member of a family whose income does not meet such requirements.
    Employment and Training Administration (ETA) means the agency within 
DOL which includes the Job Corps.
    Enrollee means a student.
    Enrollment means:
    (1) For resident students, the period of time from the date the 
student leaves home to begin government-authorized travel to the 
assigned center to the date of the scheduled arrival at the official 
travel destination authorized by the Center Director upon termination 
from Job Corps; and
    (2) For nonresident students, the period of time from the time the 
student arrives at any center activity or program until he or she 
physically leaves such activity or program.
    Environmental health program means the center program of health, 
safety, and prevention of environmental hazards for staff and students.
    Facility survey means a review of center facilities conducted by 
professional architects and/or engineers to establish the condition of a 
facility and determine repairs, alterations, or replacement, if any, 
necessary to meet health and safety, building code or programmatic 
requirements.
    Family means persons living in a single residence who are related by 
blood, marriage, or decrees of court and are included in one or more the 
following categories:
    (1) A husband, wife and dependent children,
    (2) A parent or guardian and dependent children, and
    (3) A husband and wife. A step-child or step-parent is considered to 
be related by marriage.
    Finance center means the agency or contractor which handles the 
payment of student allowances, allotments, and transportation charges.
    Imprest fund means a cash fund of a fixed amount established by an 
advance of funds, without charge to an appropriation, from an agency 
finance or disbursing officer to a duly appointed cashier, for 
disbursement as needed from time to time in making payment in cash for 
relatively small purchases. Imprest funds occur only at

[[Page 333]]

CCCs. (For contract centers, see definition of ``petty cash fund''.)
    Income means all income actually received from all sources by an 
individual or, in the case of a family, by all members of the family for 
the 6-month (annualized) period prior to application. Family size is the 
maximum number of family members during the 6-month period prior to 
application. When computing family income, income of a spouse and other 
family members is counted for the portion of the 6-month (annualized) 
period prior to application that the person was actually a member of the 
family.
    (1) For the purpose of determining an individual's eligibility for 
participation in the Job Corps program, family income includes:
    (i) Gross wages, including wages from community service employment 
(CSE), work experience, and on-the-job training (OJT) paid from Job 
Training Partnership Act funds, and salaries (before deductions);
    (ii) Net self-employment income (gross receipts minus operating 
expenses); and
    (iii) Other money income received from sources such as interest, net 
rents, OASI (Old Age and Survivors Insurance) social security benefits, 
pensions, alimony, and periodic income from insurance policy annuities, 
and other sources of income.
    (2) Family income does not include:
    (i) Non-cash income such as food stamps or compensation received in 
the form of food or housing;
    (ii) Imputed value of owner-occupied property, i.e., rental value;
    (iii) Public assistance payments;
    (iv) Cash payments received pursuant to a State plan approved under 
title I, IV, X, or XVI of the Social Security Act, or disability 
insurance payments received under title II of the Social Security Act;
    (v) Federal, State, or local unemployment benefits;
    (vi) Capital gains and losses;
    (vii) One-time unearned income, such as, but not limited to:
    (A) Payments received for a limited fixed term under income 
maintenance programs and supplemental (private) unemployment benefits 
plans;
    (B) One-time or fixed-term scholarship or fellowship grants;
    (C) Accident, health, and casualty insurance proceeds;
    (D) Disability and death payments including fixed-term (but not 
lifetime) life insurance annuities and death benefits;
    (E) One-time award and gifts;
    (F) Inheritance, including fixed-term annuities;
    (G) Fixed-term workers compensation awards;
    (H) Soil bank payments; and
    (I) Agricultural crop stabilization payments;
    (viii) Pay or allowance which were previously received by any 
veteran while serving on active duty in the Armed Forces;
    (ix) Educational assistance and compensation payments to veterans 
and other eligible persons under chapters 11, 13, 31, 34, 35, and 36, of 
title 38, U.S. Code;
    (x) Payments made under the Trade Act of 1974;
    (xi) Payments received under the Black Lung Benefits Act (30 U.S.C. 
901 et seq.);
    (xii) Any income directly or indirectly derived from, or arising out 
of, any property held by the United States in trust for any Indian 
tribe, band, or group or any individual; per capita payments; and 
services, compensation or funds provided by the United States in 
accordance with, or generated by, the exercise of any right guaranteed 
or protected by treaty; and any property distributed or income derived 
therefrom, or any amounts paid to or for the legatees or next of kin of 
any member, derived from or arising out of the settlement of an Indian 
claim; and
    (xiii) Child support payments.
    Individual means a person who lives alone, or who lives with 
unrelated individuals, or who lives in a single residence where no 
family member claims that person as a dependent. An individual with 
disabilities has an option of applying and being considered as a member 
of a family or as an individual.
    Individual with disabilities means any person within the definition 
at 29 CFR part 33 or 34 or 41 CFR part 60-741 as applicable. Although 
the definition employs the plural form ``disabilities,''

[[Page 334]]

and individual with a single impairment is covered within the 
definition. See Sec.Sec. 638.539(g) and 638.811(a).
    Interagency Agreement means that formal agreement between DOL and 
another Federal agency administering and operating centers. This 
agreement establishes procedures for the funding, administration, 
operation, and review of those centers as well as the resolution of any 
disputes.
    Job Corps means the agency of the Department of Labor established by 
section 422 of the Job Training Partnership Act (JTPA) (29 U.S.C. 1692) 
to perform those functions of the Secretary of Labor set forth in title 
IV-B of JTPA (29 U.S.C. 1691 et seq.).
    Job Corps Director means the chief official of the Job Corps or the 
Job Corps Director's designee.
    Leisure-time employment means part-time paid employment of students.
    Lower living standard income level means the income level (adjusted 
for regional, metropolitan, urban, and rural differences and family 
size) determined annually by the Secretary based on the most recent 
``lower living family budget'' issued by the Secretary.
    Maximum benefits means the apportioning of various segments of Job 
Corps training so that individual needs of each student are met and the 
student achieves as much benefit from the Job Corps as his or her 
abilities allow.
    National office means the national office of Job Corps.
    National training contractor means a labor union, union-affiliated 
organization, business organization, or a combination thereof, having 
contracts with the national office (or in the case of CCCs, a Federal 
agency at the national level) to provide vocational training, placement, 
or other services under a single contract including multi-area 
operations.
    Occupational exploration program means the center program whereby a 
student is made aware of the vocational training opportunities made 
available by the center in order for the student to make an informed 
vocational selection.
    Operational support services means activities or services required 
for the operation of Job Corps, such as outreach and screening services, 
contracted vocational training and off-center educational training, 
placement services, certain health services, and miscellaneous 
logistical services.
    Petty cash fund means a cash fund of a fixed amount from a contract 
center finance or disbursing officer to a contract center's duly 
appointed cashier, for disbursement as needed from time to time in 
making payment in cash for relatively small purchases. Petty cash funds 
occur at contract centers. (For CCCs, see definition of ``imprest 
fund''.)
    Placement means student employment, entry into the Armed Forces, or 
enrollment in other training or education programs, within six months 
following termination from Job Corps (or such other period as may be 
announced by the Job Corps Director by notice in the Federal Register).
    Placement agency means an organization acting pursuant to a contract 
with Job Corps that provides placement services to students.
    Poverty level means the annual income level at or below which 
families are considered to live in poverty, as annually determined by 
the Department of Health and Human Services.
    Readjustment allowance means the money accumulated by and reserved 
for each student on a monthly basis during tenure in Job Corps that is 
paid in a lump sum after termination.
    Readmission means re-enrollment of a student who has previously been 
enrolled in Job Corps for less than 24 months and applies for 
reenrollment to the basic program and can be expected to complete a 
program within the remaining portion of the youth's 24-month enrollment 
period.
    Regional appeal board means the board designated by the Regional 
Director in a regional office that considers student appeals of 
disciplinary discharges.
    Regional Director means the chief official of a regional office or 
the Regional Director's designee.
    Regional office means a regional office of Job Corps.
    Regional Solicitor means the chief official of a regional office of 
the DOL Office of the Solicitor or the Regional Solicitor's designee.

[[Page 335]]

    Screening agency means an organization acting pursuant to a contract 
with the Job Corps that performs outreach, screens, and enrolls youth 
into Job Corps.
    Secretary means the Secretary of Labor (the chief official of DOL) 
or the Secretary's designee.
    Site survey means a survey of a potential location for a center that 
includes a preliminary engineering evaluation of the condition and 
capacity of existing buildings, pavements, utility systems, installed 
equipment, and all other real property components as well as a 
preliminary cost estimate for acquisition of facilities, necessary 
rehabilitation, modification, and new construction required that would, 
among other considerations, take into account structural accessibility 
for persons with handicaps.
    State means one of the several States, the District of Columbia, the 
Commonwealth of Puerto Rico, the United States Virgin Islands, Guam, the 
Commonwealth of the Northern Mariana Islands, American Samoa, the 
Federated States of Micronesia, the Republic of the Marshall Islands, 
and the Republic of Palau/Trust Territory.
    Student means an individual who is enrolled in Job Corps.
    Student handbook means the document developed by the center operator 
and given to each student during orientation that outlines center 
services, rules, and regulations and student rights and 
responsibilities. SeeSec. 638.501 of this part.
    Termination means the act of officially ending a student's 
enrollment in Job Corps for any reason.
    Transfer means the reassignment of a student from one center to 
another.
    Unauthorized goods means firearms and ammunition; explosives and 
incendiaries; knives with blades longer than 2'' (two inches); homemade 
weapons; all other weapons and instruments used primarily to inflict 
personal injury; stolen property; drugs, including alcohol, marijuana, 
depressants, stimulants, hallucinogens, tranquilizers, and drug 
paraphernalia except for drugs and/or paraphernalia that are prescribed 
for medical reasons; and any other goods prohibited by the center 
operator in the student handbook.
    Utilization study means an architectural/engineering report which is 
developed subsequent to a site survey or assessment after the regional 
and national offices have agreed, on the basis of the site survey, that 
the site is potentially favorable for a center. After the utilization 
study is approved by the Job Corps Director it becomes the basis for 
scope of work, budget, design, rehabilitation, and construction of 
facilities for the center.
    Vocational skills training (VST) means activities that provide 
vocational instruction to students through actual construction or 
improvement of permanent facilities or other approved projects.
    Work experience program means a program for assignment of a student 
to an actual job situation, either on-center or off-center, for the 
purpose of enhancing a student's employability. Work experience 
requiring the student to work over 25 hours per week is subject to the 
provisions of the Fair Labor Standards Act and State and local minimum 
wage laws for hours worked in excess of 25 hours per week.

[55 FR 12996, Apr. 6, 1990, as amended at 58 FR 69099, Dec. 29, 1993]



      Subpart C_Funding, Site Selection, and Facilities Management



Sec.  638.300  Eligibility for funds and eligible deliverers.

    (a) Funds shall be made available by the Secretary to eligible 
deliverers for the operation of centers and for the provision of Job 
Corps operational support services.
    (b) Eligible deliverers for the operation of centers and for the 
operational support services necessary to center operation shall be 
units of Federal, State, and local government, State and local public 
agencies, private-for-profit and nonprofit organizations, Indian tribes 
and organizations, and labor unions, union-affiliated, and union/
management organizations.

[[Page 336]]



Sec.  638.301  Funding procedures.

    (a) Contracting officers shall request proposals for the operation 
of all contract centers and for provision of operational support 
services, pursuant to the Federal Acquisition Regulation (48 CFR chapter 
1) and the DOL Acquisition Regulation (48 CFR chapter 29) for work to be 
done under contract. The requests for proposal for each contract center 
and for each operational support service contract shall describe 
specifications and standards unique to the operation of the center and 
for the provision of operational support services.
    (b) Job Corps contract center operators shall be selected and funded 
on the basis of proposals received, according to criteria established by 
the Job Corps Director. Such criteria shall be listed in the request for 
proposals.
    (c) The contracting officer shall negotiate with eligible deliverers 
for operational support services on the basis of the criteria developed 
for each specific service to be rendered. Such criteria shall be listed 
in the request for proposals.
    (d) The Secretary may enter into interagency agreements with 
eligible deliverers that are Federal agencies for the funding, 
establishment, and operation of CCCs. Such interagency agreements shall 
ensure compliance by such Federal agencies with the regulations under 
this part.
    (e) Job Corps payments to Federal agencies that operate CCCs shall 
be made by a transfer of obligational authority from DOL to the 
respective operating agency on a quarterly basis.
    (f) The Secretary is authorized to expend funds made available for 
Job Corps for the purpose of printing, binding, and disseminating data 
and other information related to Job Corps to public agencies, private 
organizations, and the general public. (Section 438(3)(A))
    (g) Notwithstanding the limitations of titles II, III, and IV of the 
Act, funds made available under those titles and transferred to the Job 
Corps program pursuant toSec. 638.541 of this part may be used for the 
Job Corps program in accordance with the provisions of this part. 
(Sections 427(b) and 439)
    (h) (1) In accordance with this section and procedures established 
by the Job Corps Director, the contracting officers shall enter into 
contracts with public or private (including nonprofit) entities for the 
provision of outreach and screening services, which shall be performed 
in accordance withSec. 638.402 of this part and procedures established 
by the Job Corps Director. (Sections 424 and 425)
    (2) In accordance with this section and procedures established by 
the Job Corps Director, the contracting officers shall enter into 
contracts with public or private (including nonprofit) entities for the 
provision of placement services, which shall be performed in accordance 
withSec. 638.409 of this part and procedures established by the Job 
Corps Director.
    (i) All agreements and contracts pursuant to this section shall be 
made pursuant to the Federal Property and Administrative Services Act of 
1949, as amended; the Federal Grant and Cooperative Agreement Act of 
1977; and the Federal Acquisition Regulation (48 CFR chapter 1) and the 
DOL Acquisition Regulation (48 CFR chapter 29).
    (j) All Job Corps contractors shall be provided with an equitable 
and negotiated management fee of not less than 1 percent of the contract 
amount.

[55 FR 12996, Apr. 6, 1990, as amended at 58 FR 69100, Dec. 29, 1993]



Sec.  638.302  Performance measurement.

    The Job Corps Director shall establish a national performance 
measurement system for centers and other program components which shall 
include annual performance standards.

[58 FR 69100, Dec. 29, 1993]



Sec.  638.303  Site selection and facilities management.

    (a) The Job Corps Director shall approve the location and size of 
all centers.
    (b) Contract centers shall be established, relocated or expanded in 
accordance with procedures established by the Job Corps Director.
    (c) For federally-operated centers, either the Job Corps Director or 
a Federal agency may propose a site on public lands and if discussions 
between them establish the advisability of such, the Job Corps Director 
may require

[[Page 337]]

that the agency submit a site survey and utilization study. If the Job 
Corps Director decides to establish a center, facilities engineering and 
real estate management will be conducted by the Job Corps Director or by 
the Federal agency pursuant to an interagency agreement and this part.



Sec.  638.304  Historical preservation.

    The Job Corps Director shall review the ``National Register of 
Historic Places,'' issued by the National Park Service, to identify 
sites, buildings, structures, and objects of archeological, 
architectural, or historic significance which could be destroyed or 
adversely affected by any proposed project or site selection. Procedures 
for review are included in the ``National Register of Historic Places'' 
at 36 CFR part 800.



Sec.  638.305  Capital improvements.

    Capital improvement projects and new construction on Job Corps 
Centers shall be requested and performed in accordance with procedures 
established by the Job Corps Director.



Sec.  638.306  Protection and maintenance of contract center 
facilities owned or leased by Job Corps.

    The Job Corps Director shall establish procedures for the protection 
and maintenance of contract center facilities owned or leased by Job 
Corps which shall be consistent with Federal Property Management 
Regulations at 41 CFR chapter 101.



Sec.  638.307  Facility surveys.

    The Job Corps Director shall issue procedures to conduct periodic 
facility surveys of centers.



Subpart D_Enrollment, Transfers, Terminations, and Placements in the Job 
                                  Corps



Sec.  638.400  Eligibility for participation.

    To participate in the Job Corps, a young man or woman must be an 
eligible youth who:
    (a) Is at least 16 and not yet 25 years of age at the time of 
enrollment, with the following exceptions:
    (1) In the case of an otherwise eligible individual with 
disabilities, there is no upper age limit;
    (2) Not more than 20 percent of the individuals enrolled by Job 
Corps may be ages 22 through 24; and
    (3) Youths 14 to 15 years of age may be eligible for enrollment upon 
a specific determination by the Job Corps Director to enroll them;
    (b) Is a United States citizen, United States national, a lawfully 
admitted permanent resident alien, a lawfully admitted refugee or 
parolee, or other alien who has been permitted to accept permanent 
employment in the United States by the Attorney General or the 
Immigration and Naturalization Service;
    (c) Requires additional education, training, or intensive counseling 
and related assistance in order to secure and hold meaningful 
employment, participate successfully in regular school work, qualify for 
other suitable training programs, satisfy Armed Forces entry 
requirements, or qualify for a job where prior skill or training is a 
prerequisite;
    (d) Is economically disadvantaged;
    (e) Has sufficient ability to benefit from the program;
    (f) Demonstrates an interest in obtaining the maximum benefit from 
the program, as evidenced by a voluntary desire to enroll and the 
youth's signature on the application form;
    (g) Has a signed consent for enrollment from a responsible parent or 
guardian if the applicant is unemancipated and under the age of majority 
(unless the parent or guardian cannot be located), pursuant to 
applicable laws on age of majority and emancipation of minors;
    (h) Has established suitable arrangements for the care of any 
dependent children for the proposed period of enrollment;
    (i) Is not on probation, parole, or under a suspended sentence, or 
under the supervision of any agency as a result of court action or 
institutionalization, unless the court or other appropriate agency 
certifies in writing that release from the supervision of the agency is 
satisfactory to the agency and does not violate applicable laws and 
regulations;

[[Page 338]]

    (j) To qualify for residential training, is currently living in an 
environment so characterized by cultural deprivations, a disruptive 
homelife, or other disorienting conditions as to substantially impair 
prospects for successful participation in a nonresidential program 
providing appropriate training, education, or assistance;
    (k) Is physically and emotionally able to participate in normal Job 
Corps duties without costly or extensive medical treatment;
    (1) Is free of any behavioral problem that would potentially prevent 
other enrollees from receiving the benefit of the program, or impede 
satisfactory relationships between the center to which the enrollee is 
assigned and surrounding communities; and
    (m) Has a background, characteristics, and physical and mental 
capabilities which provide reasonable expectations of employment after 
training.

[55 FR 12996, Apr. 6, 1990, as amended at 58 FR 69100, Dec. 29, 1993]



Sec.  638.401  Outreach and screening of participants.

    In accordance with procedures issued by the Job Corps Director:
    (a) The Regional Director, as contracting officer, shall contract 
with screening agencies, which shall perform Job Corps outreach and 
screening functions.
    (b) Screening agencies shall develop outreach and referral sources, 
actively seek out potential applicants, conduct personal interviews with 
all applicants, and determine who are interested and likely Job Corps 
participants. See alsoSec. 638.541 of this part.
    (c) Screening agencies shall complete all Job Corps application 
forms.
    (1) Except as provided in paragraph (c)(2) of this section, 
screening agencies shall determine whether applicants meet the 
eligibility criteria inSec. 638.400 of this part for participation in 
the Job Corps.
    (2) The Job Corps Director may provide that determinations with 
respect to one or more of the eligibility criteria set forth inSec. 
638.400 of this part shall be made by the Regional Director on the basis 
of information and recommendations supplied by the screening agency.
    (3) An applicant for participation in the Job Corps who has been 
determined ineligible may appeal that determination pursuant toSec. 
638.539 of this part. (Sections 423, 424, 425, and 144(a))
    (d) In enrolling individuals who are to be nonresidential 
participants, priority shall be given to those eligible individuals who 
are single parents with dependent children.

[55 FR 12996, Apr. 6, 1990, as amended at 58 FR 69100, Dec. 29, 1993]



Sec.  638.402  Enrollment by readmission.

    Procedures for screening and selection of applicants for readmission 
shall be issued by the Job Corps Director.



Sec.  638.403  Selective Service.

    The Job Corps Director shall develop procedures to ensure that as a 
condition of enrollment and continued enrollment:
    (a) Each male applicant 18 years of age or older has evidence that 
he has complied with section 3 of the Military Selective Service Act (50 
U.S.C. App. 453), by presenting and submitting to registration if 
required pursuant to such section; and
    (b) When a male student turns 18 years of age after enrollment, he 
submits to the center operator evidence that he has complied with 
section 3 of the Military Selective Service Act (50 U.S.C. App. 453), by 
presenting and submitting to registration if required pursuant to such 
section. (Section 504)



Sec.  638.404  Transfers.

    Transfer of a student from one center of assignment to another 
center shall be made only in accordance with procedures issued by the 
Job Corps Director.



Sec.  638.405  Extensions of enrollment.

    The center operator shall see that the total length of enrollment of 
a student does not exceed two years (section 426(a)) except that an 
extension of enrollment may be authorized in accordance with procedures 
issued by the Job Corps Director. Students enrolled in advanced career 
training programs may be enrolled up to one additional year. (Section 
428(d)(1))

[[Page 339]]



Sec.  638.406  Federal status of students.

    Students shall not be deemed Federal employees and shall not be 
subject to the provisions of law relating to Federal employment, 
including those relating to hours of work, rates of employment, leave, 
unemployment compensation, and Federal employee benefits, except as 
provided by 5 U.S.C. 8143(a) (Federal employees' compensation) and by 
Sec.Sec. 638.526 and 638.527 of this part. (Section 436(a))



Sec.  638.407  Terminations.

    The Job Corps Director shall issue procedures for the termination of 
students.



Sec.  638.408  Transportation.

    The transportation of students to and from centers shall occur in 
accordance with procedures issued by the Job Corps Director.



Sec.  638.409  Placement and job development.

    The overall objective of all Job Corps activities shall be to 
enhance each student's employability and to effect the successful 
placement of each student. Placement efforts shall concentrate on jobs 
related to a student's vocational training, on military service when 
this is the student's choice, or on acceptance and placement in other 
educational and/or training programs. The placement of students shall be 
performed in accordance with procedures issued by the Job Corps 
Director.
    (a) The Regional Director, as contracting officer, shall contract 
with placement agencies, which shall perform placement functions.
    (b) Placement agencies shall complete all Job Corps placement forms.



                       Subpart E_Center Operations



Sec.  638.500  Orientation program.

    The center operator shall design and implement a reception and 
orientation program in accordance with procedures issued by the Job 
Corps Director.



Sec.  638.501  Student handbook.

    Each center operator shall develop a student handbook which provides 
essential information to students for distribution to all students in 
accordance with procedures issued by the Job Corps Director.



Sec.  638.502  Job Corps basic education program.

    The Job Corps Director shall prescribe or provide for basic 
education curricula to be used at centers. Students are considered to be 
in-school youths. The Job Corps Director, in coordination with regional 
offices, shall review and approve the basic education program at each 
center. Center operators shall provide the following educational 
programs at a minimum:
    (a) Reading and language skills;
    (b) Mathematics;
    (c) A program to prepare eligible students for the American Council 
on Education Tests of General Educational Development (GED);
    (d) World of work;
    (e) Health education;
    (f) Driver education; and
    (g) English as a second language (ESL) programs for selected center 
operators (regional offices shall arrange for the assignment of selected 
applicants needing ESL programs to the centers where such programs are 
available).



Sec.  638.503  Vocational training.

    (a) Each center shall provide enrollees with competency-based or 
individualized training in an area which will best contribute to the 
student's opportunities for permanent long-term employment. Specific 
vocational training programs offered at individual centers will be 
subject to the approval of the Job Corps Director in accordance with 
policies issued by the Job Corps Director.
    (b) The Job Corps Director may determine that it is appropriate to 
contract for vocational training programs at specific centers with 
national business, union, or union-affiliated organizations in order to 
facilitate entry of students into the workforce. All agreements with 
these national training contractors will be contracted at the national 
level in accordance with policies issued by the Job Corps Director; the 
Federal Acquisition Regulation (48 CFR chapter 1); the DOL Acquisition

[[Page 340]]

Regulation (48 CFR chapter 29); and, if CCCs, interagency agreements.



Sec.  638.504  Occupational exploration program.

    An occupational exploration program shall be provided by all centers 
in accordance with procedures issued by the Job Corps Director.



Sec.  638.505  Scheduling of training.

    The amount of time for each student's education and vocational 
training shall be apportioned to the individual needs of each student 
pursuant to procedures developed by the Job Corps Director.



Sec.  638.506  Purchase of vocational supplies and equipment.

    The Job Corps Director shall develop procedures for the low-cost 
sale to students of vocational tools, clothing, and other equipment that 
are prerequisites to employment.



Sec.  638.507  Work experience.

    (a) The center operator shall emphasize and implement programs of 
work experience for students through center program activities or 
through arrangement with employers. Work experience shall be under 
actual working conditions and should enhance the employability, 
responsibility, and confidence of the students.
    (b) The following limitations shall be observed in establishing work 
experience programs:
    (1) Students shall only be assigned to work meeting the safety 
standards ofSec. 638.803 of this part.
    (2) Any work experience arranged for employment not covered by a 
Federal, State, or local minimum wage law shall have prior regional 
office approval.
    (3) When work experience with pay is arranged, the student, for 
applicable wage provisions of the Davis-Bacon Act, the Fair Labor 
Standards Act, the Service Contract Act, and other applicable minimum 
wage laws, shall be considered a joint employee of the Job Corps and the 
work experience employer.
    (i) The wages paid by Job Corps (including the reasonable cost to 
Job Corps of room, board, and other facilities, as well as clothing and 
living allowances) shall be no less than the federal minimum wage rate 
set forth in section (6)(a)(1) of the Fair Labor Standards Act (FLSA) 
for up to 25 hours a week. The work experience employer shall pay the 
student, in cash, any wages above the FLSA minimum whenever such 
additional amounts are required by the Davis-Bacon Act, the Service 
Contract Act, the State or local minimum wage law, or other applicable 
minimum wage law. For any time in excess of 25 hours per week, the work 
experience employer shall pay the student, in cash, no less than the 
entire wage at the wage rate required by applicable law.
    (ii) In addition to the cash wages required to be paid by work 
experience employers by paragraph (b)(3)(i) of this section, work 
experience employers, after the first six weeks of work by a student, 
shall also pay additional cash wages to the student at an hourly rate of 
25 percent of the wage set forth in section 6(a)(1) of the Fair Labor 
Standards Act.



Sec.  638.508  Sale of services or objects.

    The services rendered or objects produced at the center may be sold 
at cost to students or center employees, but shall not be sold in the 
community unless such services or products do not displace workers in 
the local community or result in the sale of products which compete with 
local merchants.



Sec.  638.509  Leisure-time employment.

    A center operator may authorize gainful leisure time employment of 
students as long as such employment does not interfere with required 
scheduled activities.



Sec.  638.510  Health care and services.

    The center operator shall provide a health program, including basic 
medical, dental, and mental health services, for all students from 
admission until termination from the Job Corps. The program shall be 
developed in accordance with procedures issued by the Job Corps 
Director.



Sec.  638.511  Drug use and abuse.

    The Job Corps Director shall develop procedures to ensure that each 
center

[[Page 341]]

operator offers students counseling and education programs related to 
drug and alcohol use and abuse.



Sec.  638.512  Sexual behavior and harassment.

    The Job Corps Director shall develop procedures to ensure that 
center operators establish rules concerning sexual behavior and 
harassment. See also Sec.Sec. 638.539(g) and 638.813(a) of this part.



Sec.  638.513  Death.

    In each case of student death, the center operator shall follow 
procedures established by the Job Corps Director, including notification 
of next of kin and for disposition of remains. See alsoSec. 638.524(d) 
of this part.



Sec.  638.514  Residential support services.

    The center operator shall provide for residential support services 
structured as an integral part of the overall training program. This 
service shall include a secure, attractive physical and social 
environment, seven days a week, 24 hours a day, designed to enhance 
learning and personal development. All students, including nonresidents 
while they are on-center, shall be provided with the full program of 
applicable services in accordance with procedures issued by the Job 
Corps Director.



Sec.  638.515  Recreation/avocational program.

    The center operator shall develop a recreation/avocational program 
in accordance with procedures issued by the Job Corps Director.



Sec.  638.516  Laundry, mail, and telephone service.

    (a) The center operator shall provide adequate laundry services and 
supplies at no cost to students. Students shall be encouraged to 
launder, iron, and repair their personal clothing.
    (b) The center operator shall establish a system for prompt delivery 
of mail received by students in a manner that protects the 
confidentiality of such mail, and shall arrange for a sufficient number 
of conveniently located pay telephones for student use.



Sec.  638.517  Counseling.

    The center operator shall establish and conduct an ongoing 
structured counseling program in accordance with procedures issued by 
the Job Corps Director.



Sec.  638.518  Intergroup relations program.

    The center operator shall conduct a structured intergroup relations 
program designed to reduce prejudice, prevent discriminatory behavior by 
staff and students, and increase understanding among racial/ethnic 
groups and between men and women. The program shall be developed in 
accordance with procedures issued by the Job Corps Director.



Sec.  638.519  Incentives system.

    The center operator shall establish and maintain its own incentives 
system for students in accordance with procedures established by the Job 
Corps Director.



Sec.  638.520  Student government and leadership programs.

    The center operator shall establish an elected student government 
and student leadership program in accordance with procedures established 
by the Job Corps Director.



Sec.  638.521  Student welfare association.

    The center operator shall develop a plan for the organization and 
operation of a student welfare association, to be run by an elected 
student government for the benefit of all students and with the help of 
a center staff advisor. This plan shall be developed in accordance with 
procedures issued by the Job Corps Director.
    (a) Student welfare association revenues may be derived from such 
sources as snack bars, vending machines, disciplinary fines, etc.
    (b) Student welfare association activities shall be funded from 
student welfare association revenues.



Sec.  638.522  Evaluation of student progress.

    The center operator shall implement a system to evaluate the 
progress of each student in receiving the maximum benefit from the 
program. The

[[Page 342]]

system shall be developed in accordance with procedures issued by the 
Job Corps Director.



Sec.  638.523  Food service.

    (a) The center operator shall ensure that meals for students are 
nutritionally well-balanced, of good quality, and sufficient in 
quantity, in accordance with procedures issued by the Job Corps 
Director. Food shall be prepared and served in a sanitary manner.
    (b) Non-students shall be charged for food provided for them unless 
prior regional office approval has been obtained. Such charges shall be 
sufficient to cover the cost of the food and its preparation.



Sec.  638.524  Allowances and allotments.

    (a) The Secretary shall periodically establish rates of allowances 
and allotments to be paid students pursuant to section 429 (a), (c), and 
(d) of the Act, and the Job Corps Director shall publish these rates as 
a notice in the Federal Register.
    (b) The Job Corps Director shall ensure that each student receives a 
readjustment allowance for each paid day of satisfactory participation 
in Job Corps after termination from the program if he/she terminates 
after 210 days in pay status or after 180 days if he/she is a maximum 
benefits or vocational completer. In the event that a student receives a 
medical termination, he/she shall be eligible for the accrued 
readjustment allowance, regardless of length of stay or other 
considerations. See also paragraph (d) of this section. (Section 
429(c)).
    (c) The Job Corps Director shall establish procedures to allow 
students to authorize deductions from their readjustment allowance, 
which shall be matched by an equal amount from Job Corps funds and sent 
biweekly as an allotment by the SPAMIS Data Center to the student's 
spouse, child(ren) or other dependent, if such spouse, child(ren) or 
other dependent resides in any State in the United States.
    (d) In the event of a student's death, any amount due, including the 
amount of any unpaid readjustment allowance, shall be paid in accordance 
with provisions of 5 U.S.C. 5582 (designation of beneficiary; order of 
precedence). (Section 429(c))

[55 FR 12996, Apr. 6, 1990, as amended at 60 FR 18993, Apr. 14, 1995]



Sec.  638.525  Clothing.

    The Job Corps Director shall establish procedures to provide 
clothing for all students by means of a clothing purchase allowance and 
by center issue.



Sec.  638.526  Tort and other claims.

    (a) Students shall be considered federal employees for purposes of 
the Tort Claims Act (28 U.S.C. 2671 et seq.). (Section 436(a)(3)). In 
the event a student is alleged to be involved in the damage, loss, or 
destruction of the property of others, or of causing personal injury to 
or the death of other individual(s), claims may be filed with the Center 
Director by the owner(s) of the property, the injured person(s), or by a 
duly authorized agent or legal representative of the claimant. The 
Center Director shall collect all of the facts, including accident and 
medical reports and the names and addresses of witnesses, and submit the 
claim for a decision to the DOL Regional Solicitor's Office. All tort 
claims for $25,000 or more shall be sent to the Associate Solicitor for 
Employee Benefits, U.S. Department of Labor, 200 Constitution Avenue, 
NW., Washington, DC 20210.
    (b) Whenever there is loss or damage to persons or property, which 
is believed to have resulted from operation of a Job Corps center and to 
be a proper charge against the Federal Government, a claim for such 
damage may be submitted by the owner(s) of the property, the injured 
person(s), or by a duly authorized agent or legal representative of the 
claimant to the Regional Solicitor, who shall determine if the claim is 
cognizable under the Tort Claims Act. Claims shall be filed no later 
than two years from the date of such loss or damage. If it is determined 
not to be cognizable, the Regional Solicitor shall consider the facts 
and may settle the claim pursuant to section 436(b) of the Act in an 
amount not to exceed $1,500.
    (c) The Job Corps may pay claims to students for lost, damaged, or 
stolen property, up to a maximum set by the

[[Page 343]]

Job Corps Director when such loss is not due to the negligence of the 
student. Students shall file claims no later than two years from the 
date of such loss. Students shall be compensated for losses when they 
are the result of a natural disaster or when the student's property is 
in the protective custody of the Job Corps, which shall be the case when 
the student is AWOL. The Job Corps Director shall provide for claims to 
be filed with regional offices for a determination on the claim. The 
regional office shall promptly notify the student and the center of its 
determination.



Sec.  638.527  Federal employees' compensation.

    (a) Students shall be considered federal employees for purposes of 
Federal employees' compensation (FEC). (Section 436(a)(2))
    (b) Resident students shall be considered to be in the ``performance 
of duty'' as Federal employees from the date they leave their homes and 
begin authorized travel to their center of assignment until the date of 
their scheduled arrival at the official travel destination upon the 
termination from Job Corps. During this period the youths shall be known 
as students, and this period shall constitute their period of 
enrollment. During this period, resident students shall be considered as 
in performance of duty at all times, during any and all of their 
activities, 24 hours a day, seven days a week, except as described in 
paragraph (d) of this section.
    (c) Non-resident students shall be considered to be ``in performance 
of duty'' as Federal employees from the time they arrive at any 
scheduled center activity or program until they physically leave such 
activity or program.
    (d) No student shall be considered as being in performance of duty 
status if he/she is absent without official leave (AWOL) or after 
arrival home on administrative leave without allowances.
    (e) In computing compensation benefits for disability or death, the 
monthly pay of a student shall be deemed that received under the 
entrance salary for a grade GS-2 Federal employee, and 5 U.S.C. 8113 (a) 
and (b) shall apply to students.
    (f) Compensation for disability shall not begin to accrue until the 
day following the date on which the injured student completes his or her 
Job Corps termination.
    (g) Whenever a student is injured, develops an occupationally 
related illness, or dies while in the performance of duty, the Job Corps 
Director shall ensure that procedures set forth in the DOL Employment 
Standards Administration regulations at 20 CFR chapter I are followed. 
The Job Corps Director shall ensure that a thorough investigation of the 
circumstances and a medical evaluation are completed and that required 
forms are filed with the DOL Office of Workers' Compensation Programs.



Sec.  638.528  Social Security.

    The Act provides that students are covered by title II of the Social 
Security Act (42 U.S.C. 401 et seq.) and shall pay applicable employment 
taxes (e.g., the Federal Insurance Contributions Act (FICA) tax) on 
their living and readjustment allowances. (Section 436(a)(1))



Sec.  638.529  Income taxes.

    The Act provides that students are Federal employees for the 
purposes of the Internal Revenue Code of 1986 (title 26, U.S. Code). The 
Job Corps Director may obtain from tax authorities information regarding 
taxation of student income and provide this to center operators and to 
the finance center.



Sec.  638.530  Emergency use of personnel, equipment and facilities.

    The Job Corps Director may provide emergency assistance when there 
is a threat of natural disaster. Students may be asked to volunteer 
their services to help in such cases. The center operator shall arrange 
that any expenses consequent to such assistance shall be borne, to the 
extent possible, by the benefiting organization.



Sec.  638.531  Limitation on the use of students in emergency projects.

    The Job Corps Director shall develop procedures, when necessary, to 
safeguard the rights and safety of students

[[Page 344]]

who volunteer to be used in emergency situations.



Sec.  638.532  Annual leave.

    The Job Corps Director shall issue procedures to administer the 
accrual and use of student leave. Such procedures shall provide that:
    (a) Except for the initial pay period, students shall accrue annual 
leave at the rate of one calendar day for each pay period provided that 
the student was not AWOL or on administrative leave without pay during 
that pay period. For the initial pay period, a student shall accrue one 
day of annual leave regardless of the date of enrollment provided that 
the student was not AWOL or on administrative leave without pay from the 
date of enrollment. Accrual time shall begin on the day the student 
departs for a center and end on the date of his or her scheduled arrival 
home or at a place of employment.
    (b) Annual leave shall continue to accrue during periods of home, 
emergency, and administrative leave with pay and shall be suspended only 
when the student is AWOL or on administrative leave without allowances.
    (c) Students shall not be paid at termination for unused accrued 
leave.
    (d) Students may use accrued annual leave at any time subject to 
approval by the Center Director. Annual leave with transportation at 
government expense shall be allowed only after the student has spent 180 
days in pay status in Job Corps, and only once per year of enrollment.
    (e) Students shall not be charged annual leave for travel time to 
and from home and center by the most direct route. Saturdays, Sundays, 
and holidays that are officially recognized at the center shall not be 
charged as annual leave.



Sec.  638.533  Other student absences.

    The Job Corps Director shall develop procedures for authorized 
student absences and to account for all absences whether authorized or 
unauthorized.



Sec.  638.534  Legal services to students.

    (a) The Job Corps Director shall develop procedures to afford 
students effective and competent legal representation in criminal and 
certain civil cases. This shall include assisting students in obtaining 
free or low cost legal assistance or obtaining local attorneys or public 
defenders to represent students, and paying for such legal services 
(provided that attorney fees in criminal cases shall not be paid by Job 
Corps except in accordance with paragraph (b) of this section), in 
accordance with guidelines issued by the Job Corps Director.
    (b) Job Corps shall not pay the expenses of legal counsel or 
representation in any criminal case or proceeding for a student, unless 
the Center Director has certified to the Regional Director, and the 
Regional Director has approved, that a public defender is not available. 
With such approval of the Regional Director, Job Corps may compensate 
attorneys obtained pursuant to paragraph (a) of this section in criminal 
cases for reasonable expenses. Compensation shall be at the rates no 
higher than those set forth in the Criminal Justice Act of 1964, as 
amended (18 U.S.C. 3006A(d)).



Sec.  638.535  Voting rights.

    The Job Corps Director shall develop procedures to enable eligible 
students and staff to vote either locally or by absentee ballot. See 
alsoSec. 638.8l4 (a) through (c) of this part.



Sec.  638.536  Religious rights.

    The right to worship or not worship as he/she chooses shall not be 
denied to any student. Religious services may not be held on-center 
unless the center is so isolated as to make transportation to and from 
community religious facilities impractical. If religious services are 
held on-center, no federal funds shall be paid to those who conduct such 
services. Services shall not be confined to one religious denomination. 
The center operator shall instruct students that students are not 
obligated by Job Corps to attend such services. See also Sec.Sec. 
638.539(g) and 638.813 of this part.

[[Page 345]]



Sec.  638.537  Disclosure of information.

    (a) Requests for information. The Job Corps Director shall develop 
administrative procedures to respond to requests for information or 
records pertaining to students and such other disclosures as may be 
necessary.
    (b) Freedom of Information Act--(1) Disclosure. Disclosure of Job 
Corps information shall be in accordance with the Freedom of Information 
Act and shall be handled according to DOL regulations at 29 CFR part 70.
    (2) Contractors. Job Corps contractors are not ``agencies'' for 
Freedom of Information Act purposes. Therefore, their records are not 
subject to disclosure under the Freedom of Information Act or 29 CFR 
part 70.
    (c) Privacy Act of 1974. When DOL maintains a system of records 
covered by the Privacy Act of 1974, or provides by contract for a 
contractor, such as a screening agency or a contract center operator, to 
operate by or on behalf of the Job Corps such a system of records to 
accomplish a Job Corps function, the requirements of the DOL regulations 
at 29 CFR part 70a apply to such system or records.



Sec.  638.538  Disciplinary procedures and appeals.

    (a) The center operator shall establish reasonable rules and 
regulations for student behavior, in accordance with procedures 
developed by the Job Corps Director. Such rules shall be established to 
ensure high standards of behavior and conduct.
    (b) The center operator shall develop reasonable sanctions for 
breaking established rules, in accordance with procedures developed by 
the Job Corps Director.
    (c) The center operator shall ensure that all students have the 
opportunity for due process in disciplinary proceedings, in accordance 
with procedures developed by the Job Corps Director. Such center 
procedures, at a minimum, shall include center review boards where the 
penalty of termination might be imposed, and procedures for appealing, 
to a regional appeal board designated by the Regional Director, center 
decisions to terminate a student. SeeSec. 638.407 of this part. The 
decision of the regional appeal board shall be final agency action.

[55 FR 12996, Apr. 6, 1990; 55 FR 23634, June 11, 1990]



Sec.  638.539  Complaints and disputes.

    (a) Center and other deliverer grievance procedures. Each center 
operator or other Job Corps deliverer shall establish and maintain a 
grievance procedure for complaints about its programs and activities 
from students and other interested parties. A hearing on each complaint 
shall be conducted, using the established grievance procedure, within 30 
days of filing of the complaint and a decision on the complaint shall be 
made by the Center Director or with the knowledge of the Center Director 
not later than 60 days after the filing of the complaint. Except for a 
complaint alleging fraud or criminal activity, complaints shall be made 
within one year of the alleged occurrence. (Section 144(a))
    (b) Federal review of student grievances. Where a student or a 
person denied enrollment has exhausted the center or other deliverer 
grievance procedure established pursuant to paragraph (a) of this 
section, the student may appeal the decision to the regional appeal 
board. The regional appeal board shall review the appeal and determine 
within 120 days after receiving the appeal whether to reverse, affirm, 
or remand the decision. The decision of the regional appeal board shall 
be final agency action. (Section 144(c))
    (c) Federal review of non-student grievances. (1) Where the 
grievance or complaint is made by an interested party other than a 
student, should the deliverer fail to provide a decision as required in 
paragraph (a) of this section, the complainant may then request from the 
Regional Director a determination whether reasonable cause exists to 
believe that the Act or this part has been violated. The request shall 
be filed no later than 10 days from the date on which the complainant 
should have received a decision pursuant to paragraph (a) of this 
section, and shall describe with specificity the facts and the 
proceedings (if any) below.
    (2) The Regional Director shall act within 90 days of receipt of the 
request and where there is reasonable cause to

[[Page 346]]

believe the Act or this part has been violated shall direct the 
deliverer to issue a decision adjudicating the dispute pursuant to the 
deliverer's grievance procedures. The Regional Director's action is not 
final agency action on the merits of the dispute and therefore is not 
appealable under the Act. See sections 144(c) and 166(a) of the Act. If 
the deliverer does not comply with the Regional Director's order within 
60 days, the Regional Director may impose a sanction on the deliverer 
for failing to issue a decision.
    (d) Failures to comply with the Act. Where DOL has reason to believe 
that the center operator or other deliverer is failing to comply with 
the requirements of the Act, the Regional Director shall investigate the 
allegation or belief and determine within 120 days after receiving the 
complaint whether such allegation or complaint is true. As the result of 
such a determination, the Regional Director may:
    (1) Direct the deliverer to handle a complaint through the grievance 
procedures established under paragraph (a) of this section; or
    (2) Investigate and determine whether the deliverer is in compliance 
with the Act and this part. If the Regional Director determines that the 
deliverer is not in compliance with the Act or this part, the 
appropriate sanctions set forth in section 164 of the Act shall be 
applied, subject to paragraph (e) or (f) of this section, as 
appropriate. (Section 163 (b) and (c))
    (e) Contract disputes. A dispute between DOL and a Job Corps 
contractor shall be handled only pursuant to the Contract Disputes Act 
and 41 CFR part 29-60.
    (f) Inter-agency disputes. A dispute between DOL and a federal 
agency operating a center shall be handled only pursuant to the 
interagency agreement with that agency for the operation of the center.
    (g) Nondiscrimination. Nondiscrimination requirements, procedures, 
complaint processing, and compliance reviews are governed by, as 
applicable, provisions of the following Department of Labor regulations:
    (1) 29 CFR part 34 and subparts B and C and Appendix A of 29 CFR 
part 32 for programs receiving financial assistance under JTPA.
    (2) 29 CFR part 33 for programs conducted by the Department of 
Labor; and
    (3) 41 CFR chapter 60 for entities that have a federal ``government 
contract'' as that term is defined in the applicable regulations.
    See alsoSec. 638.813(a) of this part, regarding discrimination.

[55 FR 12996, Apr. 6, 1990, as amended at 58 FR 69100, Dec. 29, 1993]



Sec.  638.540  Cooperation with agencies and institutions.

    The Job Corps Director shall develop guidelines for the national 
office's, the regional offices', and for deliverers' maintenance of 
cooperative relationships with other agencies and institutions, 
including law enforcement, educational institutions, communities, and 
other employment and training agencies.



Sec.  638.541  Job Corps training opportunities.

    The Job Corps Director shall develop policies and requirements which 
will ensure linkages, where feasible, with other Federal, State and 
local programs to enhance the provision of services to disadvantaged 
youth. These shall include, where appropriate: Referrals of enrollees; 
participant assessment; services accompanying pre-employment and work 
maturity skills training, work experience, job search skills training, 
basic skills training, and occupational skills training authorized under 
the Job Training Partnership Act for youth programs; and services 
supporting participants in the Job Opportunities and Basic Skills 
Training Program (JOBS) (section 427(b)). Such services may be provided 
sequentially or concurrently. Nothing in this part shall be construed to 
prohibit an individual who has been a participant in Job Corps from 
concurrently or subsequently participating in programs under title II of 
JTPA, or to prohibit an individual who has been a participant in 
programs under title II of JTPA from concurrently or subsequently 
participating in Job Corps.

[55 FR 12996, Apr. 6, 1990, as amended at 58 FR 69100, Dec. 29, 1993]

[[Page 347]]



Sec.  638.542  Child care services.

    (a) Job Corps centers shall, where practicable, arrange for the 
provision of child care for students with dependent children.
    (b) Center operators may propose and, with the approval of the Job 
Corps Director, establish child care facilities.

[55 FR 12996, Apr. 6, 1990, as amended at 58 FR 69100, Dec. 29, 1993]



Sec.  638.543  Community relations program.

    Each center operator shall establish a community relations program, 
which shall include establishment of a community relations council which 
includes student representation. (Section 431)



           Subpart F_Applied Vocational Skills Training (VST)



Sec.  638.600  Applied vocational skills training (VST) through work projects.

    (a)(1) The Job Corps Director shall establish procedures for 
administering applied vocational skills training (VST) projects; such 
procedures shall include funding and reporting requirements, criteria to 
be used for granting approvals, and reviewing requirements.
    (2) Each applied VST project shall be submitted to the Regional 
Director for approval. The annual applied VST plan described in 
paragraph (c) of this section shall be submitted to the Regional 
Director for approval.
    (b) Applied VST may be provided in an actual working setting for 
training students in the construction and related trades. This shall 
involve authorized construction or other projects that result in 
finished facilities or products. This shall include conservation 
projects on Federal, State, and public lands, and projects performed for 
other organizations in accordance with policies established by the Job 
Corps Director. Centers may also perform applied VST public service 
projects for nearby communities and capital improvements for other Job 
Corps centers.
    (c) Applied VST shall be the major vehicle for the training of 
students in the construction and related trades. In each year, each 
center operator shall develop an annual applied VST plan for the coming 
year. In order to ensure that maximum training opportunities are 
available to students, the center vocational instructor (and/or the 
national training contractor, when applicable) shall participate in the 
planning and shall approve each project which involves his/her 
particular trade. Applied VST projects shall be planned in such a manner 
as to give priority to on-center rehabilitation and construction needs. 
The Job Corps Director shall establish annual funding levels to support 
applied VST programs and shall establish specific policies on 
limitation, documentation, and reporting requirements relating to 
applied VST programs.



Sec.  638.601  Applied VST budgeting.

    The Job Corps Director shall establish procedures to ensure that 
center operators maintain applied VST project funds as a separate center 
budget line item and maintain strict accountability for the use or 
nonuse of such funds. The approval of the Job Corps national office is 
necessary to transfer applied VST project funds to any other center 
budget category or program activity. In the case of civilian 
conservation centers, the use of VST project funds shall be governed by 
the interagency agreements.



      Subpart G_Experimental, Research, and Demonstration Projects



Sec.  638.700  Experimental, research, and demonstration projects.

    (a) The Job Corps Director, at his or her discretion, may undertake 
experimental, research, or demonstration projects for the purpose of 
promoting greater efficiency and effectiveness in the Job Corps program 
in accordance with section 433 of the Act.
    (b) The Job Corps Director may arrange for projects under this 
section to be undertaken jointly with other Federal or federally 
assisted programs.
    (c) The Secretary may waive any provision of this part that the 
Secretary finds would prevent the implementation of experimental, 
research, or demonstration project elements essential

[[Page 348]]

to a determination of their feasibility and usefulness.



                   Subpart H_Administrative Provisions



Sec.  638.800  Program management.

    (a) The Job Corps Director shall establish and use internal program 
management procedures sufficient to prevent fraud or program abuse. The 
Job Corps Director shall ensure that sufficient auditable and otherwise 
adequate records are maintained to support the expenditure of all funds 
under the Act.
    (b) The Job Corps Director shall provide guidelines for center 
staffing levels and qualifications. The guidelines shall adhere to 
standard levels of professional education and experience which are 
accepted generally within the fields of education and counseling.



Sec.  638.801  Staff training.

    The Job Corps Director shall establish guidelines for necessary 
training for national office, regional office, and deliverer staff.



Sec.  638.802  Student records management.

    The Job Corps Director shall develop guidelines for a system of 
maintaining records for each student during enrollment and for the 
disposition of such records after termination.



Sec.  638.803  Safety.

    (a) The Job Corps Director shall establish procedures to ensure that 
students are not required or permitted to work, to be trained, to 
reside, or to receive services in buildings or surroundings or under 
conditions that are unsanitary, hazardous, or lack proper ventilation. 
Whenever students are employed or trained for jobs, they shall be 
assigned to such jobs or training in accordance with appropriate health 
and safety practices.
    (b) The Job Corps Director shall develop a procedure to provide 
appropriate protective clothing for students in work or training.
    (c) The Job Corps Director shall develop procedures to ensure 
compliance with applicable DOL Occupational Safety and Health 
Administration regulations.



Sec.  638.804  Environmental health.

    The Job Corps Director shall provide guidelines for proper 
environmental health conditions.



Sec.  638.805  Security and law enforcement.

    (a) The Job Corps Director shall provide guidelines to protect the 
security of students, staff, and property on-center on a 24-hours-a-day, 
7-days-a-week basis.
    (b)(1) All property which would otherwise be under exclusive federal 
legislative jurisdiction shall be considered under concurrent 
jurisdiction with the appropriate State and locality with respect to 
criminal law enforcement as long as a center is operated on such 
property. This extends to portions of the property (e.g., housing and 
recreational facilities) in addition to the portions of the property 
used as the center or training facility.
    (2) The Job Corps Director shall ensure that centers on property 
under concurrent federal-State jurisdiction establish agreements with 
federal, State and local law enforcement agencies to enforce criminal 
laws on such property. (Section 435(d))
    (c) The Job Corps Director shall develop procedures to ensure that 
any searches of a student's personal area or belongings for unauthorized 
goods follow applicable right-to-privacy laws.



Sec.  638.806  Property management and procurement.

    The Job Corps Director shall develop procedures to establish and 
maintain a system for acquisition, protection, preservation, 
maintenance, and disposition of Job Corps real and personal property, 
and services so as to maximize its usefulness and to minimize operating, 
repair, and replacement costs.



Sec.  638.807  Imprest and petty cash funds.

    Federally operated centers shall establish auditable imprest funds. 
Contract centers shall establish auditable petty cash funds. The Job 
Corps Director shall develop procedures to ensure the security of and 
accountability for imprest and petty cash funds.

[[Page 349]]



Sec.  638.808  Center financial management and reporting.

    The Job Corps Director shall establish procedures to ensure that 
each center operator and each subcontractor maintain a financial 
management system that will provide accurate, complete, and current 
disclosures of the financial results of Job Corps operations, and will 
provide sufficient data for effective evaluation of program activities. 
Fiscal accounts shall be maintained in a manner that ensures timely and 
accurate reporting as required by the Job Corps Director.



Sec.  638.809  Audit.

    (a) The Secretary of Labor, the DOL Office of Inspector General, the 
Comptroller General of the United States, and any of their duly 
authorized representatives, shall have access to any books, documents, 
papers, and records of the Job Corps deliverers and their subcontractors 
that are pertinent to the Job Corps program for the purpose of making 
surveys, audits, examinations, excerpts, and transcripts.
    (b) The Secretary shall, with reasonable frequency, survey, audit, 
or examine, or arrange for the survey, audit, or examination of Job 
Corps deliverers, or their subcontractors using Federal auditors or 
independent public accountants. Such surveys, audits, or examinations 
normally shall be conducted annually but not less than once every two 
years.



Sec.  638.810  Reporting requirements.

    The Job Corps Director shall establish procedures to ensure timely 
and complete reporting of such program information as is necessary to 
maintain accountability for the Job Corps program and funding.



Sec.  638.811  Review and evaluation.

    The Job Corps Director shall establish adequate program management 
to provide continuous examination of the performance of the components 
of the program.



Sec.  638.812  State and local taxation of Job Corps deliverers.

    The Act provides that transactions conducted by a private for-profit 
deliverer or a nonprofit deliverer in connection with the deliverer's 
operation of a center or other Job Corps program or activity shall not 
be considered as generating gross receipts. Such deliverer shall not be 
liable, directly or indirectly, to any State or subdivision thereof (nor 
to any person acting on behalf thereof) for any gross receipts taxes, 
business privilege taxes measured by gross receipts, or any similar 
taxes imposed on, or measured by, gross receipts in connection with any 
payments made to or by such deliverer for operating a center or other 
Job Corps program, or activity. Such deliverer shall not be liable to 
any State or subdivision thereof to collect or pay any sales, excise, 
use, or similar tax imposed upon the sale to or use by such deliverer of 
any property, service, or other item in connection with the operation of 
a center or other Job Corps program or activity. (Section 437(c))



Sec.  638.813  Nondiscrimination; nonsectarian activities.

    (a) Nondiscrimination. Center operators and other deliverers, and 
subcontractors and/or subrecipients of center operators and other 
deliverers shall comply with the nondiscrimination provisions of section 
167 of the Act and its implementing regulations, and with, as 
applicable, 29 CFR parts 31 and 32, part 33, and 41 CFR chapter 60. For 
the purposes of section 167 of the Act, students shall be considered as 
the ultimate beneficiaries of Federal financial assistance. (Section 
167)
    (b) Nonsectarian activities. Students shall not be employed or 
trained on the construction, operation, or maintenance of so much of any 
facility as is used or to be used for sectarian instruction or as a 
place for religious worship. (Section 167(a)(3))



Sec.  638.814  Lobbying; political activities; unionization.

    No funds provided under the Act may be used in any way:
    (a) To attempt to influence in any manner a member of Congress to 
favor or oppose any legislation or appropriation by Congress;
    (b) To attempt to influence in any manner a member of a State or 
local

[[Page 350]]

legislature to favor or oppose any legislation or appropriation by such 
legislature;
    (c) For any activity which involves political activities; or
    (d) For any activity which will assist, promote, or deter union 
organizing. (Sections 141(1) and 143(c)(1))



Sec.  638.815  Charging fees.

    No person or organization shall charge an individual a fee for the 
placement or referral of such individual in or to a training program 
under the Act. (Section 141(j))



PART 639_WORKER ADJUSTMENT AND RETRAINING NOTIFICATION--
Table of Contents



Sec.
639.1 Purpose and scope.
639.2 What does WARN require?
639.3 Definitions.
639.4 Who must give notice?
639.5 When must notice be given?
639.6 Who must receive notice?
639.7 What must the notice contain?
639.8 How is the notice served?
639.9 When may notice be given less than 60 days in advance?
639.10 When may notice be extended?

    Authority: 29 U.S.C. 2107(a).

    Source: 54 FR 16064, Apr. 20, 1989, unless otherwise noted.



Sec.  639.1  Purpose and scope.

    (a) Purpose of WARN. The Worker Adjustment and Retraining 
Notification Act (WARN or the Act) provides protection to workers, their 
families and communities by requiring employers to provide notification 
60 calendar days in advance of plant closings and mass layoffs. Advance 
notice provides workers and their families some transition time to 
adjust to the prospective loss of employment, to seek and obtain 
alternative jobs and, if necessary, to enter skill training or 
retraining that will allow these workers to successfully compete in the 
job market. WARN also provides for notice to State dislocated worker 
units so that dislocated worker assistance can be promptly provided.
    (b) Scope of these regulations. These regulations establish basic 
definitions and rules for giving notice, implementing the provisions of 
WARN. The Department's objective is to establish clear principles and 
broad guidelines which can be applied in specific circumstances. 
However, the Department recognizes that Federal rulemaking cannot 
address the multitude of industry and company-specific situations in 
which advance notice will be given.
    (c) Notice encouraged where not required. Section 7 of the Act 
states:

It is the sense of Congress that an employer who is not required to 
comply with the notice requirements of section 3 should, to the extent 
possible, provide notice to its employees about a proposal to close a 
plant or permanently reduce its workforce.

    (d) WARN enforcement. Enforcement of WARN will be through the 
courts, as provided in section 5 of the statute. Employees, their 
representatives and units of local government may initiate civil actions 
against employers believed to be in violation ofSec. 3 of the Act. The 
Department of Labor has no legal standing in any enforcement action and, 
therefore, will not be in a position to issue advisory opinions of 
specific cases. The Department will provide assistance in understanding 
these regulations and may revise them from time to time as may be 
necessary.
    (e) Notice in ambiguous situations. It is civically desirable and it 
would appear to be good business practice for an employer to provide 
advance notice to its workers or unions, local government and the State 
when terminating a significant number of employees. In practical terms, 
there are some questions and ambiguities of interpretation inherent in 
the application of WARN to business practices in the market economy that 
cannot be addressed in these regulations. It is therefore prudent for 
employers to weigh the desirability of advance notice against the 
possibility of expensive and time-consuming litigation to resolve 
disputes where notice has not been given. The Department encourages 
employers to give notice in all circumstances.
    (f) Coordination with job placement and retraining programs. The 
Department, through these regulations and through the Trade Adjustment 
Assistance Program (TAA) and Economic Dislocation and Worker Adjustment 
Assistance Act (EDWAA) regulations, encourages maximum coordination of 
the actions and activities of these programs to assure

[[Page 351]]

that the negative impact of dislocation on workers is lessened to the 
extent possible. By providing for notice to the State dislocated worker 
unit, WARN notice begins the process of assisting workers who will be 
dislocated.
    (g) WARN not to supersede other laws and contracts. The provisions 
of WARN do not supersede any laws or collective bargaining agreements 
that provide for additional notice or additional rights and remedies. If 
such law or agreement provides for a longer notice period, WARN notice 
shall run concurrently with that additional notice period. Collective 
bargaining agreements may be used to clarify or amplify the terms and 
conditions of WARN, but may not reduce WARN rights.



Sec.  639.2  What does WARN require?

    WARN requires employers who are planning a plant closing or a mass 
layoff to give affected employees at least 60 days' notice of such an 
employment action. While the 60-day period is the minimum for advance 
notice, this provision is not intended to discourage employers from 
voluntarily providing longer periods of advance notice. Not all plant 
closings and layoffs are subject to the Act, and certain employment 
thresholds must be reached before the Act applies. WARN sets out 
specific exemptions, and provides for a reduction in the notification 
period in particular circumstances. Damages and civil penalties can be 
assessed against employers who violate the Act.



Sec.  639.3  Definitions.

    (a) Employer. (1) The term ``employer'' means any business 
enterprise that employs--
    (i) 100 or more employees, excluding part-time employees; or
    (ii) 100 or more employees, including part-time employees, who in 
the aggregate work at least 4,000 hours per week, exclusive of hours of 
overtime.

Workers on temporary layoff or on leave who have a reasonable 
expectation of recall are counted as employees. An employee has a 
``reasonable expectation of recall'' when he/she understands, through 
notification or through industry practice, that his/her employment with 
the employer has been temporarily interrupted and that he/she will be 
recalled to the same or to a similar job. The term ``employer'' includes 
non-profit organizations of the requisite size. Regular Federal, State, 
local and federally recognized Indian tribal governments are not 
covered. However, the term ``employer'' includes public and quasi-public 
entities which engage in business (i.e., take part in a commercial or 
industrial enterprise, supply a service or good on a mercantile basis, 
or provide independent management of public assets, raising revenue and 
making desired investments), and which are separately organized from the 
regular government, which have their own governing bodies and which have 
independent authority to manage their personnel and assets.
    (2) Under existing legal rules, independent contractors and 
subsidiaries which are wholly or partially owned by a parent company are 
treated as separate employers or as a part of the parent or contracting 
company depending upon the degree of their independence from the parent. 
Some of the factors to be considered in making this determination are 
(i) common ownership, (ii) common directors and/or officers, (iii) de 
facto exercise of control, (iv) unity of personnel policies emanating 
from a common source, and (v) the dependency of operations.
    (3) Workers, other than part-time workers, who are exempt from 
notice under section 4 of WARN are nonetheless counted as employees for 
purposes of determining coverage as an employer.
    (4) An employer may have one or more sites of employment under 
common ownership or control. An example would be a major auto maker 
which has dozens of automobile plants throughout the country. Each plant 
would be considered a site of employment, but there is only one 
``employer'', the auto maker.
    (b) Plant closing. The term ``plant closing'' means the permanent or 
temporary shutdown of a ``single site of employment'', or one or more 
``facilities or operating units'' within a single site of employment, if 
the shutdown results in an ``employment loss'' during any 30-day period 
at the single site of employment for 50 or more employees,

[[Page 352]]

excluding any part-time employees. An employment action that results in 
the effective cessation of production or the work performed by a unit, 
even if a few employees remain, is a shutdown. A ``temporary shutdown'' 
triggers the notice requirement only if there are a sufficient number of 
terminations, layoffs exceeding 6 months, or reductions in hours of work 
as specified under the definition of ``employment loss.''
    (c) Mass layoff. (1) The term ``mass layoff'' means a reduction in 
force which first, is not the result of a plant closing, and second, 
results in an employment loss at the single site of employment during 
any 30-day period for:
    (i) At least 33 percent of the active employees, excluding part-time 
employees, and
    (ii) At least 50 employees, excluding part-time employees.

Where 500 or more employees (excluding part-time employees) are 
affected, the 33% requirement does not apply, and notice is required if 
the other criteria are met. Plant closings involve employment loss which 
results from the shutdown of one or more distinct units within a single 
site or the entire site. A mass layoff involves employment loss, 
regardless of whether one or more units are shut down at the site.
    (2) Workers, other than part-time workers, who are exempt from 
notice under section 4 of WARN are nonetheless counted as employees for 
purposes of determining coverage as a plant closing or mass layoff. For 
example, if an employer closes a temporary project on which 10 permanent 
and 40 temporary workers are employed, a covered plant closing has 
occurred although only 10 workers are entitled to notice.
    (d) Representative. The term ``representative'' means an exclusive 
representative of employees within the meaning of section 9(a) or 8(f) 
of the National Labor Relations Act or section 2 of the Railway Labor 
Act.
    (e) Affected employees. The term ``affected employees'' means 
employees who may reasonably be expected to experience an employment 
loss as a consequence of a proposed plant closing or mass layoff by 
their employer. This includes individually identifiable employees who 
will likely lose their jobs because of bumping rights or other factors, 
to the extent that such individual workers reasonably can be identified 
at the time notice is required to be given. The term ``affected 
employees'' includes managerial and supervisory employees, but does not 
include business partners. Consultant or contract employees who have a 
separate employment relationship with another employer and are paid by 
that other employer, or who are self-employed, are not ``affected 
employees'' of the business to which they are assigned. In addition, for 
purposes of determining whether coverage thresholds are met, either 
incumbent workers in jobs being eliminated or, if known 60 days in 
advance, the actual employees who suffer an employment loss may be 
counted.
    (f) Employment loss. (1) The term ``employment loss'' means (i) an 
employment termination, other than a discharge for cause, voluntary 
departure, or retirement, (ii) a layoff exceeding 6 months, or (iii) a 
reduction in hours of work of individual employees of more than 50% 
during each month of any 6-month period.
    (2) Where a termination or a layoff (see paragraphs (f)(1)(i) and 
(ii) of this section) is involved, an employment loss does not occur 
when an employee is reassigned or transferred to employer-sponsored 
programs, such as retraining or job search activities, as long as the 
reassignment does not constitute a constructive discharge or other 
involuntary termination.
    (3) An employee is not considered to have experienced an employment 
loss if the closing or layoff is the result of the relocation or 
consolidation of part or all of the employer's business and, prior to 
the closing or layoff--
    (i) The employer offers to transfer the employee to a different site 
of employment within a reasonable commuting distance with no more than a 
6-month break in employment, or
    (ii) The employer offers to transfer the employee to any other site 
of employment regardless of distance with no more than a 6-month break 
in employment, and the employee accepts within 30 days of the offer or 
of the closing or layoff, whichever is later.
    (4) A ``relocation or consolidation'' of part or all of an 
employer's business,

[[Page 353]]

for purposes of paragraphSec. 639.3(h)(4), means that some definable 
business, whether customer orders, product lines, or operations, is 
transferred to a different site of employment and that transfer results 
in a plant closing or mass layoff.
    (g) Unit of local government. The term ``unit of local government'' 
means any general purpose political subdivision of a State, which has 
the power to levy taxes and spend funds and which also has general 
corporate and police powers. When a covered employment site is located 
in more than one unit of local government, the employer must give notice 
to the unit to which it determines it directly paid the highest taxes 
for the year preceding the year for which the determination is made. All 
local taxes directly paid to the local government should be aggregated 
for this purpose.
    (h) Part-time employee. The term ``part-time'' employee means an 
employee who is employed for an average of fewer than 20 hours per week 
or who has been employed for fewer than 6 of the 12 months preceding the 
date on which notice is required, including workers who work full-time. 
This term may include workers who would traditionally be understood as 
``seasonal'' employees. The period to be used for calculating whether a 
worker has worked ``an average of fewer than 20 hours per week'' is the 
shorter of the actual time the worker has been employed or the most 
recent 90 days.
    (i) Single site of employment. (1) A single site of employment can 
refer to either a single location or a group of contiguous locations. 
Groups of structures which form a campus or industrial park, or separate 
facilities across the street from one another, may be considered a 
single site of employment.
    (2) There may be several single sites of employment within a single 
building, such as an office building, if separate employers conduct 
activities within such a building. For example, an office building 
housing 50 different businesses will contain 50 single sites of 
employment. The offices of each employer will be its single site of 
employment.
    (3) Separate buildings or areas which are not directly connected or 
in immediate proximity may be considered a single site of employment if 
they are in reasonable geographic proximity, used for the same purpose, 
and share the same staff and equipment. An example is an employer who 
manages a number of warehouses in an area but who regularly shifts or 
rotates the same employees from one building to another.
    (4) Non-contiguous sites in the same geographic area which do not 
share the same staff or operational purpose should not be considered a 
single site. For example, assembly plants which are located on opposite 
sides of a town and which are managed by a single employer are separate 
sites if they employ different workers.
    (5) Contiguous buildings owned by the same employer which have 
separate management, produce different products, and have separate 
workforces are considered separate single sites of employment.
    (6) For workers whose primary duties require travel from point to 
point, who are outstationed, or whose primary duties involve work 
outside any of the employer's regular employment sites (e.g., railroad 
workers, bus drivers, salespersons), the single site of employment to 
which they are assigned as their home base, from which their work is 
assigned, or to which they report will be the single site in which they 
are covered for WARN purposes.
    (7) Foreign sites of employment are not covered under WARN. U.S. 
workers at such sites are counted to determine whether an employer is 
covered as an employer underSec. 639.3(a).
    (8) The term ``single site of employment'' may also apply to truly 
unusual organizational situations where the above criteria do not 
reasonably apply. The application of this definition with the intent to 
evade the purpose of the Act to provide notice is not acceptable.
    (j) Facility or operating unit. The term ``facility'' refers to a 
building or buildings. The term ``operating unit'' refers to an 
organizationally or operationally distinct product, operation, or 
specific work function within or across facilities at the single site.
    (k) State dislocated worker unit. The term ``State dislocated worker 
unit'' means a unit designated or created in each State by the Governor 
under title

[[Page 354]]

III of the Job Training Partnership Act, as amended by EDWAA.
    (l) State. For the purpose of WARN, the term ``State'' includes the 
50 States, the District of Columbia, the Commonwealth of Puerto Rico, 
and the U.S. Virgin Islands.



Sec.  639.4  Who must give notice?

    Section 3(a) of WARN states that ``an employer shall not order a 
plant closing or mass layoff until the end of a 60-day period after the 
employer serves written notice of such an order * * *.'' Therefore, an 
employer who is anticipating carrying out a plant closing or mass layoff 
is required to give notice to affected employees or their 
representative(s), the State dislocated worker unit and the chief 
elected official of a unit of local government. (See definitions in 
Sec.  639.3 of this part.)
    (a) It is the responsibility of the employer to decide the most 
appropriate person within the employer's organization to prepare and 
deliver the notice to affected employees or their representative(s), the 
State dislocated worker unit and the chief elected official of a unit of 
local government. In most instances, this may be the local site plant 
manager, the local personnel director or a labor relations officer.
    (b) An employer who has previously announced and carried out a 
short-term layoff (6 months or less) which is being extended beyond 6 
months due to business circumstances (including unforeseeable changes in 
price or cost) not reasonably foreseeable at the time of the initial 
layoff is required to give notice when it becomes reasonably foreseeable 
that the extension is required. A layoff extending beyond 6 months from 
the date the layoff commenced for any other reason shall be treated as 
an employment loss from the date of its commencement.
    (c) In the case of the sale of part or all of a business, section 
2(b)(1) of WARN defines who the ``employer'' is. The seller is 
responsible for providing notice of any plant closing or mass layoff 
which takes place up to and including the effective date (time) of the 
sale, and the buyer is responsible for providing notice of any plant 
closing or mass layoff that takes place thereafter. Affected employees 
are always entitled to notice; at all times the employer is responsible 
for providing notice.
    (1) If the seller is made aware of any definite plans on the part of 
the buyer to carry out a plant closing or mass layoff within 60 days of 
purchase, the seller may give notice to affected employees as an agent 
of the buyer, if so empowered. If the seller does not give notice, the 
buyer is, nevertheless, responsible to give notice. If the seller gives 
notice as the buyer's agent, the responsibility for notice still remains 
with the buyer.
    (2) It may be prudent for the buyer and seller to determine the 
impacts of the sale on workers, and to arrange between them for advance 
notice to be given to affected employees or their representative(s), if 
a mass layoff or plant closing is planned.



Sec.  639.5  When must notice be given?

    (a) General rule. (1) With certain exceptions discussed in 
paragraphs (b), (c) and (d) of this section and inSec. 639.9 of this 
part, notice must be given at least 60 calendar days prior to any 
planned plant closing or mass layoff, as defined in these regulations. 
When all employees are not terminated on the same date, the date of the 
first individual termination within the statutory 30-day or 90-day 
period triggers the 60-day notice requirement. A worker's last day of 
employment is considered the date of that worker's layoff. The first and 
each subsequent group of terminees are entitled to a full 60 days' 
notice. In order for an employer to decide whether issuing notice is 
required, the employer should--
    (i) Look ahead 30 days and behind 30 days to determine whether 
employment actions both taken and planned will, in the aggregate for any 
30-day period, reach the minimum numbers for a plant closing or a mass 
layoff and thus trigger the notice requirement; and
    (ii) Look ahead 90 days and behind 90 days to determine whether 
employment actions both taken and planned each of which separately is 
not of sufficient size to trigger WARN coverage will, in the aggregate 
for any 90-day period, reach the minimum numbers for a plant closing or 
a mass layoff and thus trigger the notice requirement. An employer is 
not, however, required under

[[Page 355]]

section 3(d) to give notice if the employer demonstrates that the 
separate employment losses are the result of separate and distinct 
actions and causes, and are not an attempt to evade the requirements of 
WARN.
    (2) The point in time at which the number of employees is to be 
measured for the purpose of determining coverage is the date the first 
notice is required to be given. If this ``snapshot'' of the number of 
employees employed on that date is clearly unrepresentative of the 
ordinary or average employment level, then a more representative number 
can be used to determine coverage. Examples of unrepresentative 
employment levels include cases when the level is near the peak or 
trough of an employment cycle or when large upward or downward shifts in 
the number of employees occur around the time notice is to be given. A 
more representative number may be an average number of employees over a 
recent period of time or the number of employees on an alternative date 
which is more representative of normal employment levels. Alternative 
methods cannot be used to evade the purpose of WARN, and should only be 
used in unusual circumstances.
    (b) Transfers. (1) Notice is not required in certain cases involving 
transfers, as described under the definition of ``employment loss'' at 
Sec.  639.3(f) of this part.
    (2) An offer of reassignment to a different site of employment 
should not be deemed to be a ``transfer'' if the new job constitutes a 
constructive discharge.
    (3) The meaning of the term ``reasonable commuting distance'' will 
vary with local and industry conditions. In determining what is a 
``reasonable commuting distance'', consideration should be given to the 
following factors: geographic accessibility of the place of work, the 
quality of the roads, customarily available transportation, and the 
usual travel time.
    (4) In cases where the transfer is beyond reasonable commuting 
distance, the employer may become liable for failure to give notice if 
an offer to transfer is not accepted within 30 days of the offer or of 
the closing or layoff (whichever is later). Depending upon when the 
offer of transfer was made by the employer, the normal 60-day notice 
period may have expired and the plant closing or mass layoff may have 
occurred. An employer is, therefore, well advised to provide 60-day 
advance notice as part of the transfer offer.
    (c) Temporary employment. (1) No notice is required if the closing 
is of a temporary facility, or if the closing or layoff is the result of 
the completion of a particular project or undertaking, and the affected 
employees were hired with the understanding that their employment was 
limited to the duration of the facility or the project or undertaking.
    (2) Employees must clearly understand at the time of hire that their 
employment is temporary. When such understandings exist will be 
determined by reference to employment contracts, collective bargaining 
agreements, or employment practices of an industry or a locality, but 
the burden of proof will lie with the employer to show that the 
temporary nature of the project or facility was clearly communicated 
should questions arise regarding the temporary employment 
understandings.
    (3) Employers in agriculture and construction frequently hire 
workers for harvesting, processing, or for work on a particular building 
or project. Such work may be seasonal but recurring. Such work falls 
under this exemption if the workers understood at the time they were 
hired that their work was temporary. In uncertain situations, it may be 
prudent for employers to clarify temporary work understandings in 
writing when workers are hired. The same employers may also have 
permanent employees who work on a variety of jobs and tasks continuously 
through most of the calendar year. Such employees are not included under 
this exemption. Giving written notice that a project is temporary will 
not convert permanent employment into temporary work, making jobs exempt 
from WARN.
    (4) Certain jobs may be related to a specific contract or order. 
Whether such jobs are temporary depends on whether the contract or order 
is part of a long-term relationship. For example, an aircraft 
manufacturer hires workers

[[Page 356]]

to produce a standard airplane for the U.S. fleet under a contract with 
the U.S. Air Force with the expectation that its contract will continue 
to be renewed during the foreseeable future. The employees of this 
manufacturer would not be considered temporary.
    (d) Strikes or lockouts. The statute provides an exemption for 
strikes and lockouts which are not intended to evade the requirements of 
the Act. A lockout occurs when, for tactical or defensive reasons during 
the course of collective bargaining or during a labor dispute, an 
employer lawfully refuses to utilize some or all of its employees for 
the performance of available work. A lockout not related to collective 
bargaining which is intended as a subterfuge to evade the Act does not 
qualify for this exemption. A plant closing or mass layoff at a site of 
employment where a strike or lockout is taking place, which occurs for 
reasons unrelated to a strike or lockout, is not covered by this 
exemption. An employer need not give notice when permanently replacing a 
person who is deemed to be an economic striker under the National Labor 
Relations Act. Non-striking employees at the same single site of 
employment who experience a covered employment loss as a result of a 
strike are entitled to notice; however, situations in which a strike or 
lockout affects non-striking employees at the same plant may constitute 
an unforeseeable business circumstance, as discussed inSec. 639.9, and 
reduced notice may apply. Similarly, the ``faltering company'' 
exception, also discussed inSec. 639.9 may apply in strike situations. 
Where a union which is on strike represents more than one bargaining 
unit at the single site, non-strikers includes the non-striking 
bargaining unit(s). Notice also is due to those workers who are not a 
part of the bargaining unit(s) which is involved in the labor 
negotiations that led to the lockout. Employees at other plants which 
have not been struck, but at which covered plant closings or mass 
layoffs occur as a direct or indirect result of a strike or lockout are 
not covered by the strike/lockout exemption. The unforeseeable business 
circumstances exception to 60 days' notice also may apply to these 
closings or layoffs at other plants.



Sec.  639.6  Who must receive notice?

    Section 3(a) of WARN provides for notice to each representative of 
the affected employees as of the time notice is required to be given or, 
if there is no such representative at that time, to each affected 
employee. Notice also must be served on the State dislocated worker unit 
and the chief elected official of the unit of local government within 
which a closing or layoff is to occur. Section 2(b)(1) of the Act states 
that ``any person who is an employee of the seller (other than a 
parttime employee) as of the effective date [time] of the sale shall be 
considered an employee of the purchaser immediately after the effective 
date [time] of the sale.'' This provision preserves the notice rights of 
the employees of a business that has been sold, but creates no other 
employment rights. Although a technical termination of the seller's 
employees may be deemed to have occurred when a sale becomes effective, 
WARN notice is only required where the employees, in fact, experience a 
covered employment loss.
    (a) Representative(s) of affected employees. Written notice is to be 
served upon the chief elected officer of the exclusive representative(s) 
or bargaining agent(s) of affected employees at the time of the notice. 
If this person is not the same as the officer of the local union(s) 
representing affected employees, it is recommended that a copy also be 
given to the local union official(s).
    (b) Affected employees. Notice is required to be given to employees 
who may reasonably be expected to experience an employment loss. This 
includes employees who will likely lose their jobs because of bumping 
rights or other factors, to the extent that such workers can be 
identified at the time notice is required to be given. If, at the time 
notice is required to be given, the employer cannot identify the 
employee who may reasonably be expected to experience an employment loss 
due to the elimination of a particular position, the employer must 
provide notice to the incumbent in that position. While part-time 
employees are not counted in determining whether plant closing or mass 
layoff thresholds are reached, such workers are due notice.

[[Page 357]]

    (c) State dislocated worker unit. Notice is to be served upon the 
State dislocated worker unit. Since the States are restructuring to 
implement training under EDWAA, service of notice upon the State 
Governor constitutes service upon the State dislocated worker unit until 
such time as the Governor makes public State procedures for serving 
notice to this unit.
    (d) Chief elected official of the unit of local government. The 
identity of the chief elected official will vary according to the local 
government structure. In the case of elected boards, the notice is to be 
served upon the board's chairperson.



Sec.  639.7  What must the notice contain?

    (a) Notice must be specific. (1) All notice must be specific.
    (2) Where voluntary notice has been given more than 60 days in 
advance, but does not contain all of the required elements set out in 
this section, the employer must ensure that all of the information 
required by this section is provided in writing to the parties listed in 
Sec.  639.6 at least 60 days in advance of a covered employment action.
    (3) Notice may be given conditional upon the occurrence or 
nonoccurrence of an event, such as the renewal of a major contract, only 
when the event is definite and the consequences of its occurrence or 
nonoccurrence will necessarily, in the normal course of business, lead 
to a covered plant closing or mass layoff less than 60 days after the 
event. For example, if the non-renewal of a major contract will lead to 
the closing of the plant that produces the articles supplied under the 
contract 30 days after the contract expires, the employer may give 
notice at least 60 days in advance of the projected closing date which 
states that if the contract is not renewed, the plant closing will occur 
on the projected date. The notice must contain each of the elements set 
out in this section.
    (4) The information provided in the notice shall be based on the 
best information available to the employer at the time the notice is 
served. It is not the intent of the regulations, that errors in the 
information provided in a notice that occur because events subsequently 
change or that are minor, inadvertent errors are to be the basis for 
finding a violation of WARN.
    (b) As used in this section, the term ``date'' refers to a specific 
date or to a 14-day period during which a separation or separations are 
expected to occur. If separations are planned according to a schedule, 
the schedule should indicate the specific dates on which or the 
beginning date of each 14-day period during which any separations are 
expected to occur. Where a 14-day period is used, notice must be given 
at least 60 days in advance of the first day of the period.
    (c) Notice to each representative of affected employees is to 
contain:
    (1) The name and address of the employment site where the plant 
closing or mass layoff will occur, and the name and telephone number of 
a company official to contact for further information;
    (2) A statement as to whether the planned action is expected to be 
permanent or temporary and, if the entire plant is to be closed, a 
statement to that effect;
    (3) The expected date of the first separation and the anticipated 
schedule for making separations;
    (4) The job titles of positions to be affected and the names of the 
workers currently holding affected jobs.

The notice may include additional information useful to the employees 
such as information on available dislocated worker assistance, and, if 
the planned action is expected to be temporary, the estimated duration, 
if known.
    (d) Notice to each affected employee who does not have a 
representative is to be written in language understandable to the 
employees and is to contain:
    (1) A statement as to whether the planned action is expected to be 
permanent or temporary and, if the entire plant is to be closed, a 
statement to that effect;
    (2) The expected date when the plant closing or mass layoff will 
commence and the expected date when the individual employee will be 
separated;
    (3) An indication whether or not bumping rights exist;
    (4) The name and telephone number of a company official to contact 
for further information.

[[Page 358]]


The notice may include additional information useful to the employees 
such as information on available dislocated worker assistance, and, if 
the planned action is expected to be temporary, the estimated duration, 
if known.
    (e) The notices separately provided to the State dislocated worker 
unit and to the chief elected official of the unit of local government 
are to contain:
    (1) The name and address of the employment site where the plant 
closing or mass layoff will occur, and the name and telephone number of 
a company official to contact for further information;
    (2) A statement as to whether the planned action is expected to be 
permanent or temporary and, if the entire plant is to be closed, a 
statement to that effect;
    (3) The expected date of the first separation, and the anticipated 
schedule for making separations;
    (4) The job titles of positions to be affected, and the number of 
affected employees in each job classification;
    (5) An indication as to whether or not bumping rights exist;
    (6) The name of each union representing affected employees, and the 
name and address of the chief elected officer of each union.

The notice may include additional information useful to the employees 
such as a statement of whether the planned action is expected to be 
temporary and, if so, its expected duration.
    (f) As an alternative to the notices outlined in paragraph (e) 
above, an employer may give notice to the State dislocated worker unit 
and to the unit of local government by providing them with a written 
notice stating the name of address of the employment site where the 
plant closing or mass layoff will occur; the name and telephone number 
of a company official to contact for further information; the expected 
date of the first separation; and the number of affected employees. The 
employer is required to maintain the other information listed inSec. 
639.7(e) on site and readily accessible to the State disclocated worker 
unit and to the unit of general local government. Should this 
information not be available when requested, it will be deemed a failure 
to give required notice.



Sec.  639.8  How is the notice served?

    Any reasonable method of delivery to the parties listed underSec. 
639.6 of this part which is designed to ensure receipt of notice of 
least 60 days before separation is acceptable (e.g., first class mail, 
personal delivery with optional signed receipt). In the case of 
notification directly to affected employees, insertion of notice into 
pay envelopes is another viable option. A ticketed notice, i.e., 
preprinted notice regularly included in each employee's pay check or pay 
envelope, does not meet the requirements of WARN.



Sec.  639.9  When may notice be given less than 60 days in advance?

    Section 3(b) of WARN sets forth three conditions under which the 
notification period may be reduced to less than 60 days. The employer 
bears the burden of proof that conditions for the exceptions have been 
met. If one of the exceptions is applicable, the employer must give as 
much notice as is practicable to the union, non-represented employees, 
the State dislocated worker unit, and the unit of local government and 
this may, in some circumstances, be notice after the fact. The employer 
must, at the time notice actually is given, provide a brief statement of 
the reason for reducing the notice period, in addition to the other 
elements set out inSec. 639.7.
    (a) The exception under section 3(b)(1) of WARN, termed ``faltering 
company'', applies to plant closings but not to mass layoffs and should 
be narrowly construed. To qualify for reduced notice under this 
exception:
    (1) An employer must have been actively seeking capital or business 
at the time that 60-day notice would have been required. That is, the 
employer must have been seeking financing or refinancing through the 
arrangement of loans, the issuance of stocks, bonds, or other methods of 
internally generated financing; or the employer must have been seeking 
additional money, credit, or business through any other commercially 
reasonable method. The employer must be able to identify specific 
actions taken to obtain capital or business.

[[Page 359]]

    (2) There must have been a realistic opportunity to obtain the 
financing or business sought.
    (3) The financing or business sought must have been sufficient, if 
obtained, to have enabled the employer to avoid or postpone the 
shutdown. The employer must be able to objectively demonstrate that the 
amount of capital or the volume of new business sought would have 
enabled the employer to keep the facility, operating unit, or site open 
for a reasonable period of time.
    (4) The employer reasonably and in good faith must have believed 
that giving the required notice would have precluded the employer from 
obtaining the needed capital or business. The employer must be able to 
objectively demonstrate that it reasonably thought that a potential 
customer or source of financing would have been unwilling to provide the 
new business or capital if notice were given, that is, if the employees, 
customers, or the public were aware that the facility, operating unit, 
or site might have to close. This condition may be satisfied if the 
employer can show that the financing or business source would not choose 
to do business with a troubled company or with a company whose workforce 
would be looking for other jobs. The actions of an employer relying on 
the ``faltering company'' exception will be viewed in a company-wide 
context. Thus, a company with access to capital markets or with cash 
reserves may not avail itself of this exception by looking solely at the 
financial condition of the facility, operating unit, or site to be 
closed.
    (b) The ``unforeseeable business circumstances'' exception under 
section 3(b)(2)(A) of WARN applies to plant closings and mass layoffs 
caused by business circumstances that were not reasonably foreseeable at 
the time that 60-day notice would have been required.
    (1) An important indicator of a business circumstance that is not 
reasonably foreseeable is that the circumstance is caused by some 
sudden, dramatic, and unexpected action or condition outside the 
employer's control. A principal client's sudden and unexpected 
termination of a major contract with the employer, a strike at a major 
supplier of the employer, and an unanticipated and dramatic major 
economic downturn might each be considered a business circumstance that 
is not reasonably foreseeable. A government ordered closing of an 
employment site that occurs without prior notice also may be an 
unforeseeable business circumstance.
    (2) The test for determining when business circumstances are not 
reasonably foreseeable focuses on an employer's business judgment. The 
employer must exercise such commercially reasonable business judgment as 
would a similarly situated employer in predicting the demands of its 
particular market. The employer is not required, however, to accurately 
predict general economic conditions that also may affect demand for its 
products or services.
    (c) The ``natural disaster'' exception in section 3(b)(2)(B) of WARN 
applies to plant closings and mass layoffs due to any form of a natural 
disaster.
    (1) Floods, earthquakes, droughts, storms, tidal waves or tsunamis 
and similar effects of nature are natural disasters under this 
provision.
    (2) To qualify for this exception, an employer must be able to 
demonstrate that its plant closing or mass layoff is a direct result of 
a natural disaster.
    (3) While a disaster may preclude full or any advance notice, such 
notice as is practicable, containing as much of the information required 
inSec. 639.7 as is available in the circumstances of the disaster 
still must be given, whether in advance or after the fact of an 
employment loss caused by a natural disaster.
    (4) Where a plant closing or mass layoff occurs as an indirect 
result of a natural disaster, the exception does not apply but the 
``unforeseeable business circumstance'' exception described in paragraph 
(b) of this section may be applicable.



Sec.  639.10  When may notice be extended?

    Additional notice is required when the date or schedule of dates of 
a planned plant closing or mass layoff is extended beyond the date or 
the ending date of any 14-day period announced in the original notice as 
follows:
    (a) If the postponement is for less than 60 days, the additional 
notice should be given as soon as possible to

[[Page 360]]

the parties identified inSec. 639.6 and should include reference to 
the earlier notice, the date (or 14-day period) to which the planned 
action is postponed, and the reasons for the postponement. The notice 
should be given in a manner which will provide the information to all 
affected employees.
    (b) If the postponement is for 60 days or more, the additional 
notice should be treated as new notice subject to the provisions of 
Sec.Sec. 639.5, 639.6 and 639.7 of this part. Rolling notice, in the 
sense of routine periodic notice, given whether or not a plant closing 
or mass layoff is impending, and with the intent to evade the purpose of 
the Act rather than give specific notice as required by WARN, is not 
acceptable.



PART 640_STANDARD FOR BENEFIT PAYMENT PROMPTNESS_UNEMPLOYMENT 
COMPENSATION--Table of Contents



Sec.
640.1 Purpose and scope.
640.2 Federal law requirements.
640.3 Interpretation of Federal law requirements.
640.4 Standard for conformity.
640.5 Criteria for compliance.
640.6 Review of State compliance.
640.7 Benefit payment performance plans.
640.8 Enforcement of the standard.
640.9 Information, reports and studies.

    Authority: Sec. 1102, Social Security Act (42 U.S.C. 1302); 
Secretary's order No. 4-75, dated April 16, 1975 (40 FR 18515) (5 U.S.C. 
553). Interpret and apply secs. 303(a)(1) and 303(b)(2) of the Social 
Security Act (42 U.S.C. 503(a)(1), 503(b)(2)).

    Source: 43 FR 33225, July 28, 1978, unless otherwise noted.



Sec.  640.1  Purpose and scope.

    (a) Purpose. (1) Section 303(a)(1) of the Social Security Act 
requires, for the purposes of title III of that Act, that a State 
unemployment compensation law include provision for methods of 
administration of the law that are reasonably calculated to insure the 
full payment of unemployment compensation when determined under the 
State law to be due to claimants. The standard in this part is issued to 
implement section 303(a)(1) in regard to promptness in the payment of 
unemployment benefits to eligible claimants.
    (2) Although the standard applies to the promptness of all benefit 
payments and the criteria apply directly to the promptness of first 
benefit payments, it is recognized that adequate performance is 
contingent upon the prompt determination of eligibility by the State as 
a condition for the payment or denial of benefits. Accordingly, implicit 
in prompt performance with respect to benefit payments is the 
corresponding need for promptness by the State in making determinations 
of eligibility. However, applicable Federal laws provide no authority 
for the Secretary of Labor to determine the eligibility of individuals 
under a State law.
    (b) Scope. (1) The standard in this part applies to all State laws 
approved by the Secretary of Labor under the Federal Unemployment Tax 
Act (section 3304 of the Internal Revenue Code of 1986, 26 U.S.C. 3304), 
and to the administration of the State laws.
    (2) The standard specified inSec. 640.4 applies to all claims for 
unemployment compensation. The criteria for State compliance inSec. 
640.5 apply to first payments of unemployment compensation under the 
State law to eligible claimants following the filing of initial claims 
and first compensable claims.

[43 FR 33225, July 28, 1978, as amended at 71 FR 35516, June 21, 2006]



Sec.  640.2  Federal law requirements.

    (a) Conformity. Section 303(a)(1) of the Social Security Act, 42 
U.S.C. 503(a)(1), requires that a State law include provision for:

    Such methods of administration * * * as are found by the Secretary 
of Labor to be reasonably calculated to insure full payment of 
unemployment compensation when due.

    (b) Compliance. Section 303(b)(2) of the Social Security Act, 42 
U.S.C. 503(b)(2), provides in part that:

    Whenever the Secretary of Labor, after reasonable notice and 
opportunity for hearing to the State agency charged with the 
administration of the State law, finds that in the administration of the 
law there is:
    (1) * * *
    (2) a failure to comply substantially with any provision specified 
in subsection (a) of this section;

the Secretary of Labor shall notify such State agency that further 
payments will not be made to the State until the Secretary of

[[Page 361]]

Labor is satisfied that there is no longer any such * * * failure to 
comply.

    Until he is so satisfied, he shall make no further certification to 
the Secretary of the Treasury with respect to such State * * *.



Sec.  640.3  Interpretation of Federal law requirements.

    (a) Section 303(a)(1). The Secretary interprets section 303(a)(1) of 
the Social Security Act to require that a State law include provision 
for such methods of administration as will reasonable insure the full 
payment of unemployment benefits to eligible claimants with the greatest 
promptness that is administratively feasible.
    (b) Section 303(b)(2). (1) The Secretary interprets section 
303(b)(2) of the Social Security Act to require that, in the 
administration of a State law, there shall be substantial compliance 
with the provision required by section 303(a)(1).
    (2) The greatest promptness that is administratively feasible will 
depend upon the circumstances in each State that impacts upon its 
performance in paying benefits. Factors reasonably beyond a State's 
control may cause its performance to drop below the level of adequacy 
expressed in the table below as criteria for substantial compliance 
applicable to all States. Where it is demonstrated that failure to meet 
the criteria of adequacy is attributable to factors reasonably beyond 
the State's control and, in light of those factors, the State has 
performed at the highest level administratively feasible, it will be 
considered that the State is in substantial compliance with the Standard 
for conformity. Whether or not the State is in substantial compliance, 
the remedial provisions of Sec.Sec. 640.7 and 640.8 will be applicable 
when the pertinent criteria are not met.



Sec.  640.4  Standard for conformity.

    A State law will satisfy the requirement of section 303(a)(1), if it 
contains a provision requiring, or which is construed to require, such 
methods of administration as will reasonably insure the full payment of 
unemployment benefits to eligible claimants with the greatest promptness 
that is administratively feasible.



Sec.  640.5  Criteria for compliance.

    The criteria in the schedule below shall apply in determining 
whether, in the administration of a State law, there has been 
substantial compliance with the provision required by section 303(a)(1) 
in the issuance of benefit payments to eligible claimants for the first 
compensable weeks of unemployment in their benefit years:

------------------------------------------------------------------------
                                           Percentage of first payments
                                           issued--days following end of
                                              first compensable week
                                         -------------------------------
                                          14 days,   21 days,
                                           waiting  nonwaiting  35 days,
                                            week       week        all
                                           States   States \1\   States
------------------------------------------------------------------------
                            Intrastate Claims
------------------------------------------------------------------------
Performance to be achieved for the 12-          87         87         93
 mo. period ending on March 31 of each
 year...................................
------------------------------------------------------------------------
                            Interstate Claims
------------------------------------------------------------------------
Performance to be achieved for the 12-          70         70        78
 mo. period ending on March 31 of each
 year...................................
------------------------------------------------------------------------
\1\ A nonwaiting week State is any State whose law does not require that
  a non-compensable period of unemployment be served before the payment
  of benefits commences.


A State will be deemed to comply substantially, as set out in Sec.Sec. 
640.2(b) and 640.3(b), if its average performance, for the period of 
review, meets or exceeds the applicable criteria set forth above.

[43 FR 33225, July 28, 1978, as amended at 71 FR 35516, June 21, 2006]



Sec.  640.6  Review of State compliance.

    (a) Annual reviews. The administration of each State law shall be 
reviewed annually for compliance, as set out in Sec.Sec. 640.2(b) and 
640.3(b). Annual reviews shall be for the 12-month period ending on 
March 31 of each year. An annual review with respect to any State shall 
be based upon the monthly reports of performance submitted to the 
Department by the State agency, any special reports of performance 
submitted to the Department by the State agency, any benefit payment 
performance plan applicable to the period being reviewed, any study or 
anylysis of performance relevant to the period being reviewed, and any 
other audit,

[[Page 362]]

study, or analysis as directed by the Department of Labor.
    (b) Periodic review. The administration of any State law may be 
reviewed at any other time, when there is reason to believe that there 
may be failure of compliance as set out in Sec.Sec. 640.2(b) and 
640.3(b). Such a review shall be based upon the same elements as may be 
required for an annual review.



Sec.  640.7  Benefit payment performance plans.

    (a) Annual plan. An annual benefit payment performance plan shall be 
submitted by a State agency to the Department of Labor when average 
performance over a 12-month period ending on March 31 of any year does 
not meet the criteria specified inSec. 640.5. An annual plan shall be 
submitted by July 31 following the applicable March 31, and shall be a 
plan for the fiscal year that begins on the succeeding October 1. An 
annual plan shall be subject to continuing appraisal during the period 
it is in effect, and shall be subject to modification from time to time 
as may be directed by the Department of Labor after consultation with 
the State agency.
    (b) Periodic plan. A periodic benefit payment performance plan shall 
be submitted by a State agency when directed by the Department of Labor. 
A periodic plan may be in addition to, or a modification of an annual 
plan and may be required even though an annual plan covering the same 
period is not required. A periodic plan shall be subject to continuing 
appraisal during the period it is in effect, and shall be subject to 
modification from time to time as may be directed by the Department of 
Labor.
    (c) Content of plan. An annual plan or periodic plan shall set forth 
such corrective actions, performance and evaluation plans, and other 
matters as the Department of Labor directs, after consultation with the 
State agency.

(Approved by the Office of Management and Budget under control number 
1205-0132)

(Pub. L. No. 96-511)

[43 FR 33225, July 28, 1978, as amended at 49 FR 18295, Apr. 30, 1984]



Sec.  640.8  Enforcement of the standard.

    (a) Action by the Department of Labor. When a State agency fails, 
for an extended period, to meet the standard set forth inSec. 640.4 or 
the criteria specified inSec. 640.5, or fails to show satisfactory 
improvement after having submitted a benefit payment performance plan of 
action, the Department of Labor shall pursue any of the following 
remedial steps that it deems necessary before considering application of 
the provisions ofSec. 640.2:
    (1) Initiate informal discussion with State agency officials 
pursuant toSec. 601.5(b) of this chapter.
    (2) Conduct an evaluation of the State's benefit payment processes 
and analyze the reasons for the State's failure to meet the standard.
    (3) Recommend specific actions for the State to take to improve its 
benefit payment performance.
    (4) Request the State to submit a plan for complying with the 
standard by a prescribed date.
    (5) Initiate special reporting requirements for a specified period 
of time.
    (6) Consult with the Governor of the State regarding the 
consequences of the State's noncompliance with the standard.
    (7) Propose to the Governor of the State and on an agreed upon basis 
arrange for the use of expert Federal staff to furnish technical 
assistance to the State agency with respect to its payment operations.
    (b) Action by the Assistant Secretary. If, after all remedial steps 
have been exhausted, a State fails to take appropriate action, or 
otherwise fails to meet the standard specified inSec. 640.4, the 
Assistant Secretary for Employment and Training shall, after taking all 
factors into consideration, recommend to the Secretary of Labor that 
appropriate notice be sent to the State agency and that an opportunity 
for a hearing be extended in accordance with section 303(b) of the 
Social Security Act.



Sec.  640.9  Information, reports and studies.

    A State shall furnish to the Secretary of Labor such information and 
reports and make such studies as the

[[Page 363]]

Secretary decides are necessary or appropriate to carry out this part.



PART 641_PROVISIONS GOVERNING THE SENIOR COMMUNITY SERVICE EMPLOYMENT
PROGRAM--Table of Contents



                    Subpart A_Purpose and Definitions

Sec.
641.100 What does this part cover?
641.110 What is the SCSEP?
641.120 What are the purposes of the SCSEP?
641.130 What is the scope of this part?
641.140 What definitions apply to this part?

        Subpart B_Coordination With the Workforce Investment Act

641.200 What is the relationship between the SCSEP and the Workforce 
          Investment Act?
641.210 What services, in addition to the applicable core services, must 
          SCSEP grantees and sub-recipients provide through the One-Stop 
          delivery system?
641.220 Does title I of WIA require the SCSEP to use OAA funds for 
          individuals who are not eligible for SCSEP services or for 
          services that are not authorized under the OAA?
641.230 Must the individual assessment conducted by the SCSEP grantee or 
          sub-recipient and the assessment performed by the One-Stop 
          delivery system be accepted for use by either entity to 
          determine the individual's need for services in the SCSEP and 
          adult programs under title I-B of WIA?
641.240 Are SCSEP participants eligible for intensive and training 
          services under title I of WIA?

                        Subpart C_The State Plan

641.300 What is the State Plan?
641.302 What is a four-year strategy?
641.305 Who is responsible for developing and submitting the State Plan?
641.310 May the Governor, or the highest government official, delegate 
          responsibility for developing and submitting the State Plan?
641.315 Who participates in developing the State Plan?
641.320 Must all national grantees operating within a State participate 
          in the State planning process?
641.325 What information must be provided in the State Plan?
641.330 How should the State Plan reflect community service needs?
641.335 How should the Governor, or the highest government official, 
          address the coordination of SCSEP services with activities 
          funded under title I of WIA?
641.340 How often must the Governor, or the highest government official, 
          update the State Plan?
641.345 What are the requirements for modifying the State Plan?
641.350 How should public comments be solicited and collected?
641.355 Who may comment on the State Plan?
641.360 How does the State Plan relate to the equitable distribution 
          report?
641.365 How must the equitable distribution provisions be reconciled 
          with the provision that disruptions to current participants 
          should be avoided?

 Subpart D_Grant Application and Responsibility Review Requirements for 
                     State and National SCSEP Grants

641.400 What entities are eligible to apply to the Department for funds 
          to administer SCSEP projects?
641.410 How does an eligible entity apply?
641.420 What are the eligibility criteria that each applicant must meet?
641.430 What are the responsibility conditions that an applicant must 
          meet?
641.440 Are there responsibility conditions that alone will disqualify 
          an applicant?
641.450 How will the Department examine the responsibility of eligible 
          entities?
641.460 What factors will the Department consider in selecting national 
          grantees?
641.465 Under what circumstances may the Department reject an 
          application?
641.470 What happens if an applicant's application is rejected?
641.480 May the Governor, or the highest government official, make 
          recommendations to the Department on national grant 
          applications?
641.490 When will the Department compete SCSEP grant awards?
641.495 When must a State compete its SCSEP award?

                   Subpart E_Services to Participants

641.500 Who is eligible to participate in the SCSEP?
641.505 When is eligibility determined?
641.507 How is applicant income computed?
641.510 What types of income are included and excluded for participant 
          eligibility determinations?
641.512 May grantees and sub-recipients enroll otherwise eligible job 
          ready individuals and place them directly into unsubsidized 
          employment?
641.515 How must grantees and sub-recipients recruit and select eligible 
          individuals for participation in the SCSEP?

[[Page 364]]

641.520 Are there any priorities that grantees and sub-recipients must 
          use in selecting eligible individuals for participation in the 
          SCSEP?
641.535 What services must grantees and sub-recipients provide to 
          participants?
641.540 What types of training may grantees and sub-recipients provide 
          to SCSEP participants in addition to the training received at 
          the community service assignment?
641.545 What supportive services may grantees and sub-recipients provide 
          to participants?
641.550 What responsibility do grantees and sub-recipients have to place 
          participants in unsubsidized employment?
641.565 What policies govern the provision of wages and benefits to 
          participants?
641.570 Is there a time limit for participation in the program?
641.575 May a grantee or sub-recipient establish a limit on the amount 
          of time its participants may spend at a host agency?
641.577 Is there a limit on community service assignment hours?
641.580 Under what circumstances may a grantee or sub-recipient 
          terminate a participant?
641.585 What is the employment status of SCSEP participants?

         Subpart F_Pilot, Demonstration, and Evaluation Projects

641.600 What is the purpose of the pilot, demonstration, and evaluation 
          projects authorized underSec. 502(e) of the OAA?
641.610 How are pilot, demonstration, and evaluation projects 
          administered?
641.620 How may an organization apply for pilot, demonstration, and 
          evaluation project funding?
641.630 What pilot, demonstration, and evaluation project activities are 
          allowable underSec. 502(e)?
641.640 Should pilot, demonstration, and evaluation project entities 
          coordinate with SCSEP grantees and sub-recipients, including 
          area agencies on aging?

                  Subpart G_Performance Accountability

641.700 What performance measures/indicators apply to SCSEP grantees?
641.710 How are the performance indicators defined?
641.720 How will the Department and grantees initially determine and 
          then adjust expected levels of performance for the core 
          performance measures?
641.730 How will the Department assist grantees in the transition to the 
          new core performance indicators?
641.740 How will the Department determine whether a grantee fails, 
          meets, or exceeds the expected levels of performance for the 
          core indicators and what will be the consequences of failing 
          to meet expected levels of performance?
641.750 Will there be performance-related incentives?

                  Subpart H_Administrative Requirements

641.800 What uniform administrative requirements apply to the use of 
          SCSEP funds?
641.803 What is program income?
641.806 How must SCSEP program income be used?
641.809 What non-Federal share (matching) requirements apply to the use 
          of SCSEP funds?
641.812 What is the period of availability of SCSEP funds?
641.815 May the period of availability be extended?
641.821 What audit requirements apply to the use of SCSEP funds?
641.824 What lobbying requirements apply to the use of SCSEP funds?
641.827 What general nondiscrimination requirements apply to the use of 
          SCSEP funds?
641.833 What policies govern political patronage?
641.836 What policies govern political activities?
641.839 What policies govern union organizing activities?
641.841 What policies govern nepotism?
641.844 What maintenance of effort requirements apply to the use of 
          SCSEP funds?
641.847 What uniform allowable cost requirements apply to the use of 
          SCSEP funds?
641.850 Are there other specific allowable and unallowable cost 
          requirements for the SCSEP?
641.853 How are costs classified?
641.856 What functions and activities constitute administrative costs?
641.859 What other special rules govern the classification of costs as 
          administrative costs or programmatic activity costs?
641.861 Must SCSEP recipients provide funding for the administrative 
          costs of sub-recipients?
641.864 What functions and activities constitute programmatic activity 
          costs?
641.867 What are the limitations on the amount of SCSEP administrative 
          costs?
641.870 Under what circumstances may the administrative cost limitation 
          be increased?
641.873 What minimum expenditure levels are required for participant 
          wages and benefits?
641.874 What conditions apply to a SCSEP grantee request to use 
          additional funds for training and supportive service costs?

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641.876 How will compliance with cost limitations and minimum 
          expenditure levels be determined?
641.879 What are the financial and performance reporting requirements 
          for recipients?
641.881 What are the SCSEP recipient's responsibilities relating to 
          awards to sub-recipients?
641.884 What are the grant closeout procedures?

           Subpart I_Grievance Procedures and Appeals Process

641.900 What appeal process is available to an applicant that does not 
          receive a grant?
641.910 What grievance procedures must grantees make available to 
          applicants, employees, and participants?
641.920 What actions of the Department may a grantee appeal and what 
          procedures apply to those appeals?
641.930 Is there an alternative dispute resolution process that may be 
          used in place of an OALJ hearing?

    Authority: 42 U.S.C. 3056 et seq.; Pub. L. 109-365.

    Source: 75 FR 53812, Sept. 1, 2010, unless otherwise noted.



                    Subpart A_Purpose and Definitions



Sec.  641.100  What does this part cover?

    Part 641 contains the Department of Labor's regulations for the 
Senior Community Service Employment Program (SCSEP), authorized under 
title V of the Older Americans Act (OAA), 42 U.S.C. 3056 et seq., as 
amended by the Older Americans Act Amendments of 2006, Public Law 109-
365. This part and other pertinent regulations set forth the regulations 
applicable to the SCSEP.
    (a) Subpart A of this part contains introductory provisions and 
definitions that apply to this part.
    (b) Subpart B of this part describes the required relationship 
between the OAA and the Workforce Investment Act of 1998 (WIA), 29 
U.S.C. 2801 et seq. These provisions discuss the coordinated efforts to 
provide services through the integration of the SCSEP within the One-
Stop delivery system.
    (c) Subpart C of this part sets forth the requirements for the State 
Plan, such as the four-year strategy, required coordination efforts, 
public comments, and equitable distribution.
    (d) Subpart D of this part establishes grant planning and 
application requirements, including grantee eligibility and 
responsibility review provisions that apply to the Department's award of 
SCSEP funds for State and national grants.
    (e) Subpart E of this part details SCSEP participant services.
    (f) Subpart F of this part provides the rules for pilot, 
demonstration, and evaluation projects.
    (g) Subpart G of this part outlines the performance accountability 
requirements. This subpart establishes requirements for performance 
measures, defines such measures, and establishes corrective actions for 
failure to meet core performance measures.
    (h) Subpart H of this part sets forth the administrative 
requirements for SCSEP funds.
    (i) Subpart I of this part describes the grievance and appeals 
processes and requirements.



Sec.  641.110  What is the SCSEP?

    The Senior Community Service Employment Program (SCSEP) is a program 
administered by the Department of Labor that serves unemployed low-
income persons who are 55 years of age and older and who have poor 
employment prospects by training them in part-time community service 
assignments and by assisting them in developing skills and experience to 
facilitate their transition to unsubsidized employment.



Sec.  641.120  What are the purposes of the SCSEP?

    The purposes of the SCSEP are to foster individual economic self-
sufficiency and promote useful part-time opportunities in community 
service assignments for unemployed low-income persons who are 55 years 
of age or older, particularly persons who have poor employment 
prospects, and to increase the number of older persons who may enjoy the 
benefits of unsubsidized employment in both the public and private 
sectors. (OAASec. 502(a)(1)).

[[Page 366]]



Sec.  641.130  What is the scope of this part?

    The regulations in this part address the requirements that apply to 
the SCSEP. More detailed policies and procedures are contained in 
administrative guidelines issued by the Department. Throughout this 
part, phrases such as, ``according to instructions (procedures) issued 
by the Department'' or ``additional guidance will be provided through 
administrative issuance'' refer to the documents issued under the 
Secretary's authority to administer the SCSEP, such as Training and 
Employment Guidance Letters (TEGLs), Training and Employment Notices 
(TENs), previously issued SCSEP Older Worker Bulletins that are still in 
effect, technical assistance guides, and other SCSEP guidance.



Sec.  641.140  What definitions apply to this part?

    The following definitions apply to this part:
    Additional indicators mean retention in unsubsidized employment for 
1 year; satisfaction of participants, employers and their host agencies 
with their experiences and the services provided; entry into volunteer 
work; and any other indicators of performance that the Secretary 
determines to be appropriate to evaluate services and performance. (OAA 
Sec.  513(b)(2)).
    At risk for homelessness means an individual is likely to become 
homeless and the individual lacks the resources and support networks 
needed to obtain housing.
    Authorized position level means the number of SCSEP enrollment 
opportunities that can be supported for a 12-month period based on the 
average national unit cost. The authorized position level is derived by 
dividing the total amount of funds appropriated for a Program Year by 
the national average unit cost per participant for that Program Year as 
determined by the Department. The national average unit cost includes 
all costs of administration, other participant costs, and participant 
wage and benefit costs as defined inSec. 506(g) of the OAA.
    Co-enrollment applies to any individual who meets the qualifications 
for SCSEP participation and is also enrolled as a participant in WIA or 
another employment and training program, as provided in the Individual 
Employment Plan.
    Community service means:
    (1) Social, health, welfare, and educational services (including 
literacy tutoring), legal and other counseling services and assistance, 
including tax counseling and assistance and financial counseling, and 
library, recreational, and other similar services;
    (2) Conservation, maintenance, or restoration of natural resources;
    (3) Community betterment or beautification;
    (4) Antipollution and environmental quality efforts;
    (5) Weatherization activities;
    (6) Economic development; and
    (7) Other such services essential and necessary to the community as 
the Secretary determines by rule to be appropriate. (OAASec. 
518(a)(1)).
    Community service assignment means part-time, temporary employment 
paid with grant funds in projects at host agencies through which 
eligible individuals are engaged in community service and receive work 
experience and job skills that can lead to unsubsidized employment. (OAA 
Sec.  518(a)(2)).
    Core indicators means hours (in the aggregate) of community service 
employment; entry into unsubsidized employment; retention in 
unsubsidized employment for six months; earnings; the number of eligible 
individuals served; and most-in-need (the number of individuals 
described inSec. 518 (a)(3)(B)(ii) or (b)(2) of the OAA). (OAASec. 
513(b)(1)).
    Core services means those services described inSec. 134(d)(2) of 
WIA.
    Department or DOL means the United States Department of Labor, 
including its agencies and organizational units.
    Disability means a disability attributable to a mental or physical 
impairment, or a combination of mental and physical impairments, that 
results in substantial functional limitations in one or more of the 
following areas of major life activity:
    (1) Self-care;
    (2) Receptive and expressive language;
    (3) Learning;

[[Page 367]]

    (4) Mobility;
    (5) Self-direction;
    (6) Capacity for independent living;
    (7) Economic self-sufficiency;
    (8) Cognitive functioning; and
    (9) Emotional adjustment. (42 U.S.C. 3002(13)).
    Equitable distribution report means a report based on the latest 
available Census or other reliable data, which lists the optimum number 
of participant positions in each designated area in the State, and the 
number of authorized participant positions each grantee serves in that 
area, taking into account the needs of underserved counties and 
incorporated cities as necessary. This report provides a basis for 
improving the distribution of SCSEP positions.
    Frail means an individual 55 years of age or older who is determined 
to be functionally impaired because the individual--
    (1)(i) Is unable to perform at least two activities of daily living 
without substantial human assistance, including verbal reminding, 
physical cueing, or supervision; or
    (ii) At the option of the State, is unable to perform at least three 
such activities without such assistance; or
    (2) Due to a cognitive or other mental impairment, requires 
substantial supervision because the individual behaves in a manner that 
poses a serious health or safety hazard to the individual or to another 
individual. (42 U.S.C. 3002(22)).
    Grant period means the time period between the effective date of the 
grant award and the ending date of the award, which includes any 
modifications extending the period of performance, whether by the 
Department's exercise of options contained in the grant agreement or 
otherwise. This is also referred to as ``project period'' or ``award 
period.''
    Grantee means an entity receiving financial assistance directly from 
the Department to carry out SCSEP activities. The grantee is the legal 
entity that receives the award and is legally responsible for carrying 
out the SCSEP, even if only a particular component of the entity is 
designated in the grant award document. Grantees include public and 
nonprofit private agencies and organizations, agencies of a State, 
tribal organizations, and Territories, that receive SCSEP grants from 
the Department. (OAA Sec.Sec. 502(b)(1), 506(a)(2)). As used here, 
``grantee'' includes ``grantee'' as defined in 29 CFR 97.3 and 
``recipient'' as defined in 29 CFR 95.2(gg).
    Greatest economic need means the need resulting from an income level 
at or below the poverty guidelines established by the Department of 
Health and Human Services and approved by the Office of Management and 
Budget (OMB). (42 U.S.C. 3002(23)).
    Greatest social need means the need caused by non-economic factors, 
which include: Physical and mental disabilities; language barriers; and 
cultural, social, or geographical isolation, including isolation caused 
by racial or ethnic status, which restricts the ability of an individual 
to perform normal daily tasks or threatens the capacity of the 
individual to live independently. (42 U.S.C. 3002(24)).
    Homeless includes:
    (1) An individual who lacks a fixed, regular, and adequate nighttime 
residence; and
    (2) An individual who has a primary nighttime residence that is:
    (i) A supervised publicly or privately operated shelter designed to 
provide temporary living accommodations (including welfare hotels, 
congregate shelters, and transitional housing for the mentally ill);
    (ii) An institution that provides a temporary residence for 
individuals intended to be institutionalized; or
    (iii) A public or private place not designed for, or ordinarily used 
as, regular sleeping accommodations for human beings. (42 U.S.C. 
11302(a)).
    Host agency means a public agency or a private nonprofit 
organization exempt from taxation underSec. 501(c)(3) of the Internal 
Revenue Code of 1986 which provides a training work site and supervision 
for one or more participants. Political parties cannot be host agencies. 
A host agency may be a religious organization as long as the projects in 
which participants are being trained do not involve the construction, 
operation, or maintenance of any facility used or to be used as a

[[Page 368]]

place for sectarian religious instruction or worship. (OAASec. 
502(b)(1)(D)).
    Indian means a person who is a member of an Indian tribe. (42 U.S.C. 
3002(26)).
    Indian tribe means any tribe, band, nation, or other organized group 
or community of Indians (including Alaska Native village or regional or 
village corporation as defined in or established pursuant to the Alaska 
Native Claims Settlement Act, 43 U.S.C. 1601 et seq.) which: (1) Is 
recognized as eligible for the special programs and services provided by 
the United States to Indians because of their status as Indians; or (2) 
is located on, or in proximity to, a Federal or State reservation or 
Rancheria. (42 U.S.C. 3002(27)).
    Individual employment plan (IEP) means a plan for a participant that 
is based on an assessment of that participant conducted by the grantee 
or sub-recipient, or a recent assessment or plan developed by another 
employment and training program, and a related service strategy. The IEP 
must include an appropriate employment goal (except that after the first 
IEP, subsequent IEPs need not contain an employment goal if such a goal 
is not feasible), objectives that lead to the goal, a timeline for the 
achievement of the objectives; and be jointly agreed upon with the 
participant. (OAASec. 502(b)(1)(N)).
    Intensive services means those services authorized bySec. 
134(d)(3) of the Workforce Investment Act.
    Jobs for Veterans Act means Public Law 107-288 (2002). Section 2(a) 
of the Jobs for Veterans Act, codified at 38 U.S.C. 4215(a), provides a 
priority of service for Department of Labor employment and training 
programs for veterans, and certain spouses of veterans, who otherwise 
meet the eligibility requirements for participation. Priority is 
extended to veterans. Priority is also extended to the spouse of a 
veteran who died of a service-connected disability; the spouse of a 
member of the Armed Forces on active duty who has been listed for a 
total of more than 90 days as missing in action, captured in the line of 
duty by a hostile force, or forcibly detained by a foreign government or 
power; the spouse of any veteran who has a total disability resulting 
from a service-connected disability; and the spouse of any veteran who 
died while a disability so evaluated was in existence. (SeeSec. 
641.520(b)).
    Job ready refers to individuals who do not require further education 
or training to perform work that is available in their labor market.
    Limited English proficiency means individuals who do not speak 
English as their primary language and who have a limited ability to 
read, speak, write, or understand English.
    Local Board means a Local Workforce Investment Board established 
underSec. 117 of the Workforce Investment Act.
    Local Workforce Investment Area or local area means an area 
designated by the Governor of a State underSec. 116 of the Workforce 
Investment Act.
    Low employment prospects means the likelihood that an individual 
will not obtain employment without the assistance of the SCSEP or 
another workforce development program. Persons with low employment 
prospects have a significant barrier to employment. Significant barriers 
to employment may include but are not limited to: Lacking a substantial 
employment history, basic skills, and/or English-language proficiency; 
lacking a high school diploma or the equivalent; having a disability; 
being homeless; or residing in socially and economically isolated rural 
or urban areas where employment opportunities are limited.
    Low literacy skills means the individual computes or solves 
problems, reads, writes, or speaks at or below the 8th grade level or is 
unable to compute or solve problems, read, write, or speak at a level 
necessary to function on the job, in the individual's family, or in 
society.
    Most-in-need means participants with one or more of the following 
characteristics: Have a severe disability; are frail; are age 75 or 
older; are age-eligible but not receiving benefits under title II of the 
Social Security Act; reside in an area with persistent unemployment and 
have severely limited employment prospects; have limited English 
proficiency; have low literacy skills; have a disability; reside in a 
rural area; are veterans; have low employment prospects; have failed to 
find

[[Page 369]]

employment after using services provided under title I of the Workforce 
Investment Act of 1998 (29 U.S.C. 2801 et seq.); or are homeless or at 
risk for homelessness. (OAASec. 513(b)(1)(E)).
    National grantee means a public or non-profit private agency or 
organization, or Tribal organization, that receives a grant under title 
V of the OAA (42 U.S.C. 3056 et seq.) to administer a SCSEP project. 
(See OAASec. 506(g)(5)).
    OAA means the Older Americans Act, 42 U.S.C. 3001 et seq., as 
amended.
    One-Stop Center means the One-Stop Center system in a WIA local area 
which must include a comprehensive One-Stop Center through which One-
Stop partners provide applicable core services and which provides access 
to other programs and services carried out by the One-Stop partners. 
(See WIASec. 134(c)(2)).
    One-Stop delivery system means a system under which employment and 
training programs, services, and activities are available through a 
network of eligible One-Stop partners, which assures that information 
about and access to core services is available regardless of where the 
individuals initially enter the workforce investment system. (See WIA 
Sec.  134(c)(2)).
    One-Stop partner means an entity described inSec. 121(b)(1) of the 
Workforce Investment Act, i.e., required partners, or an entity 
described inSec. 121(b)(2) of the Workforce Investment Act, i.e., 
additional partners.
    Other participant (enrollee) costs means the costs of participant 
training, including the payment of reasonable costs to instructors, 
classroom rental, training supplies, materials, equipment, and tuition, 
and which may be provided before or during a community service 
assignment, in a classroom setting, or under other appropriate 
arrangements; job placement assistance, including job development and 
job search assistance; participant supportive services to enable a 
participant to successfully participate in a project, including the 
payment of reasonable costs of transportation, health care and medical 
services, special job-related or personal counseling, incidentals (such 
as work shoes, badges, uniforms, eyeglasses, and tools), child and adult 
care, temporary shelter, and follow-up services; and outreach, 
recruitment and selection, intake orientation, and assessments. (OAA 
Sec.  502(c)(6)(A)(ii)-(v)).
    Pacific Island and Asian Americans means Americans having origins in 
any of the original peoples of the Far East, Southeast Asia, the Indian 
Subcontinent, or the Pacific Islands. (OAASec. 518(a)(5)).
    Participant means an individual who is determined to be eligible for 
the SCSEP, is given a community service assignment, and is receiving any 
service funded by the program as described in subpart E.
    Persistent unemployment means that the annual average unemployment 
rate for a county or city is more than 20 percent higher than the 
national average for two out of the last three years.
    Poor employment prospects means the significant likelihood that an 
individual will not obtain employment without the assistance of the 
SCSEP or another workforce development program. Persons with poor 
employment prospects have a significant barrier to employment; 
significant barriers to employment include but are not limited to: 
lacking a substantial employment history, basic skills, and/or English-
language proficiency; lacking a high school diploma or the equivalent; 
having a disability; being homeless; or residing in socially and 
economically isolated rural or urban areas where employment 
opportunities are limited.
    Program operator means a grantee or sub-recipient that receives 
SCSEP funds from a SCSEP grantee or a higher-tier SCSEP sub-recipient 
and performs the following activities for all its participants: 
Eligibility determination, participant assessment, and development of 
and placement into community service assignments.
    Program Year means the one-year period beginning on July 1 and 
ending on June 30.
    Project means an undertaking by a grantee or sub-recipient in 
accordance with a grant or contract agreement that provides service to 
communities and training and employment opportunities to eligible 
individuals.
    Recipient means grantee. As used here, ``recipient'' includes 
``recipient''

[[Page 370]]

as defined in 29 CFR 95.2(gg) and ``grantee'' as defined in 29 CFR 97.3.
    Residence means an individual's declared dwelling place or address 
as demonstrated by appropriate documentation.
    Rural means an area not designated as a metropolitan statistical 
area by the Census Bureau; segments within metropolitan counties 
identified by codes 4 through 10 in the Rural Urban Commuting Area 
(RUCA) system; and RUCA codes 2 and 3 for census tracts that are larger 
than 400 square miles and have population density of less than 30 people 
per square mile.
    SCSEP means the Senior Community Service Employment Program 
authorized under title V of the OAA.
    Secretary means the Secretary of the U.S. Department of Labor.
    Service area means the geographic area served by a local SCSEP 
project in accordance with a grant agreement.
    Severe disability means a severe, chronic disability attributable to 
mental or physical impairment, or a combination of mental and physical 
impairments, that--
    (1) Is likely to continue indefinitely; and
    (2) Results in substantial functional limitation in 3 or more of the 
following areas of major life activity:
    (i) Self-care;
    (ii) Receptive and expressive language;
    (iii) Learning;
    (iv) Mobility;
    (v) Self-direction;
    (vi) Capacity for independent living;
    (vii) Economic self-sufficiency. (42 U.S.C. 3002(48)).
    Severely limited employment prospects means the substantial 
likelihood that an individual will not obtain employment without the 
assistance of the SCSEP or another workforce development program. 
Persons with severely limited employment prospects have more than one 
significant barrier to employment; significant barriers to employment 
may include but are not limited to: Lacking a substantial employment 
history, basic skills, and/or English-language proficiency; lacking a 
high school diploma or the equivalent; having a disability; being 
homeless; or residing in socially and economically isolated rural or 
urban areas where employment opportunities are limited.
    State Board means a State Workforce Investment Board established 
under WIASec. 111.
    State grantee means the entity designated by the Governor, or the 
highest government official, to enter into a grant with the Department 
to administer a State or Territory SCSEP project under the OAA. Except 
as applied to funding distributions underSec. 506 of the OAA, this 
definition applies to the 50 States, Puerto Rico, the District of 
Columbia and the following Territories: Guam, American Samoa, U.S. 
Virgin Islands, and the Commonwealth of the Northern Mariana Islands.
    State Plan means a plan that the Governor, or the highest government 
official, of a State must submit to the Secretary that outlines a four-
year strategy, and describes the planning and implementation process, 
for the statewide provision of community service employment and other 
authorized activities for eligible individuals under SCSEP. (SeeSec. 
641.300).
    Sub-recipient means the legal entity to which a sub-award of 
financial assistance is made by the grantee (or by a higher-tier sub-
recipient), and that is accountable to the grantee for the use of the 
funds provided. As used here, ``sub-recipient'' includes ``sub-grantee'' 
as defined in 29 CFR 97.3 and ``sub-recipient'' as defined in 29 CFR 
95.2(kk).
    Supportive services means services, such as transportation, health 
and medical services, special job-related or personal counseling, 
incidentals (such as work shoes, badges, uniforms, eye-glasses, and 
tools), child and adult care, housing, including temporary shelter, 
follow up services, and needs-related payments, which are necessary to 
enable an individual to participate in activities authorized under the 
SCSEP. (OAASec. 502(c)(6)(A)(iv) and 518(a)(7)).
    Title V of the OAA means 42 U.S.C. 3056 et seq., as amended.
    Training services means those services authorized by WIASec. 
134(d)(4).
    Tribal organization means the recognized governing body of any 
Indian

[[Page 371]]

tribe, or any legally established organization of Indians which is 
controlled, sanctioned, or chartered by such governing body. (42 U.S.C. 
3002(54)).
    Unemployed means an individual who is without a job and who wants 
and is available for work, including an individual who may have 
occasional employment that does not result in a constant source of 
income. (OAA 518(a)(8)).
    Veteran means an individual who is a ``covered person'' for purposes 
of the Jobs for Veterans Act, 38 U.S.C. 4215(a)(1).
    Volunteer work means:
    (1) For purposes ofSec. 641.140 of this part, activities or work 
that former participants perform for a public agency of a State, local 
government or intergovernmental agency, or for a charity or not-for-
profit organization, including faith-based or community-based 
organizations, for civic, charitable, or for humanitarian reasons, and 
without promise, expectation, or receipt of compensation;
    (2) For informational reporting purposes, volunteer work also can 
include similar activities that a former participant performs on his or 
her own that are not conducted through a formal organization or agency 
as long as those activities are not performed for a member of the former 
participant's family or of the individual's own household. These types 
of volunteer activities will not be included in the calculation of the 
``entry into volunteer work'' indicator underSec. 641.140.
    Workforce Investment Act (WIA) means the Workforce Investment Act of 
1998 (Pub. L. 105-220 (Aug. 7, 1998)), 29 U.S.C. 2801 et seq., as 
amended.
    Workforce Investment Act (WIA) regulations means regulations at 20 
CFR part 652, subpart D and parts 660-671.

[75 FR 53812, Sept. 1, 2010, as amended at 77 FR 4661, Jan. 31, 2012]

    Effective Date Note: At 77 FR 4661, Jan. 31, 2012,Sec. 641.140 was 
amended by revising the definition of ``additional indicators'' and 
adding the definition of ``volunteer work''. These amendments contain 
information collection and recordkeeping requirements and will not 
become effective until approval has been given by the Office of 
Management and Budget.



        Subpart B_Coordination With the Workforce Investment Act



Sec.  641.200  What is the relationship between the SCSEP and the 
Workforce Investment Act?

    The SCSEP is a required partner under the Workforce Investment Act. 
As such, it is a part of the One-Stop delivery system. When acting in 
their capacity as WIA partners, SCSEP grantees and sub-recipients are 
required to follow all applicable rules under WIA and its regulations. 
(29 U.S.C. 2841(b)(1)(B)(vi) and 20 CFR 662.200 through 662.280).



Sec.  641.210  What services, in addition to the applicable core
services, must SCSEP grantees and sub-recipients provide through 
the One-Stop delivery system?

    In addition to providing core services, as defined at 20 CFR 662.240 
of the WIA regulations, SCSEP grantees and sub-recipients must make 
arrangements through the One-Stop delivery system to provide eligible 
and ineligible individuals with referrals to WIA intensive and training 
services and access to other activities and programs carried out by 
other One-Stop partners.



Sec.  641.220  Does title I of WIA require the SCSEP to use OAA funds
for individuals who are not eligible for SCSEP services or for 
services that are not authorized under the OAA?

    No, SCSEP requirements continue to apply. Title V resources may not 
be used to serve individuals who are not SCSEP-eligible. The Workforce 
Investment Act creates a seamless service delivery system for 
individuals seeking workforce development services by linking the One-
Stop partners in the One-Stop delivery system. Although the overall 
effect is to provide universal access to core services, SCSEP resources 
may only be used to provide services that are authorized and provided 
under the SCSEP to eligible individuals. Note, however, that one 
allowable SCSEP cost is a SCSEP project's proportionate share of One-
Stop costs. SeeSec. 641.850(d). Title V funds can be used to pay wages 
to SCSEP participants receiving intensive and training services under 
title I of WIA provided that the SCSEP participants have each

[[Page 372]]

received a community service assignment. All other individuals who are 
in need of the services provided under the SCSEP, but who do not meet 
the eligibility criteria to enroll in the SCSEP, should be referred to 
or enrolled in WIA or other appropriate partner programs. WIASec. 
121(b)(1). These arrangements should be negotiated in the Memorandum of 
Understanding (MOU), which is an agreement developed and executed 
between the Local Workforce Investment Board, with the agreement of the 
chief local elected official, and the One-Stop partners relating to the 
operation of the One-Stop delivery system in the local area. The MOU is 
further described in the WIA regulations at 20 CFR Sec.Sec. 662.300 
and 662.310.



Sec.  641.230  Must the individual assessment conducted by the SCSEP 
grantee or sub-recipient and the assessment performed by the One-Stop
delivery system be accepted for use by either entity to determine the 
individual's need for services in the SCSEP and adult programs 
          under title I-B of WIA?

    Yes,Sec. 502(b)(3) of the OAA provides that an assessment or IEP 
completed by the SCSEP satisfies any condition for an assessment, 
service strategy, or IEP completed at the One-Stop and vice-versa. (OAA 
Sec.  502(b)(3)). These reciprocal arrangements and the contents of the 
SCSEP IEP and WIA IEP should be negotiated in the MOU.



Sec.  641.240  Are SCSEP participants eligible for intensive and 
training services under title I of WIA?

    (a) Although SCSEP participants are not automatically eligible for 
intensive and training services under title I of WIA, local boards may 
deem SCSEP participants, either individually or as a group, as 
satisfying the requirements for receiving adult intensive and training 
services under title I of WIA.
    (b) SCSEP participants who have been assessed and for whom an IEP 
has been developed have received an intensive service under 20 CFR 
663.240(a) of the WIA regulations. In order to enhance skill development 
related to the IEP, it may be necessary to provide training beyond the 
community service assignment to enable participants to meet their 
unsubsidized employment objectives. The SCSEP grantee or sub-recipient, 
the host agency, the WIA program, or another One-Stop partner may 
provide training as appropriate and as negotiated in the MOU. (SeeSec. 
641.540 for a further discussion of training for SCSEP participants.)



                        Subpart C_The State Plan



Sec.  641.300  What is the State Plan?

    The State Plan is a plan, submitted by the Governor, or the highest 
government official, in each State, as an independent document or as 
part of the WIA Unified Plan, that outlines a four-year strategy for the 
statewide provision of community service employment and other authorized 
activities for eligible individuals under the SCSEP as described in 
Sec.  641.302. The State Plan also describes the planning and 
implementation process for SCSEP services in the State, taking into 
account the relative distribution of eligible individuals and employment 
opportunities within the State. The State Plan is intended to foster 
coordination among the various SCSEP grantees and sub-recipients 
operating within the State and to facilitate the efforts of 
stakeholders, including State and local boards under WIA, to work 
collaboratively through a participatory process to accomplish the 
SCSEP's goals. (OAASec. 503(a)(1)). The State Plan provisions are 
listed inSec. 641.325.



Sec.  641.302  What is a four-year strategy?

    The State Plan must outline a four-year strategy for the statewide 
provision of community service employment and other authorized 
activities for eligible individuals under the SCSEP program. (OAASec. 
503(a)(1)). The four-year strategy must specifically address the 
following:
    (a) The State's long-term strategy for achieving an equitable 
distribution of SCSEP positions within the State that:
    (1) Moves positions from over-served to underserved locations within 
the State, underSec. 641.365;
    (2) Equitably serves rural and urban areas; and
    (3) Serves individuals afforded priority for service, pursuant to 
Sec.  641.520;

[[Page 373]]

    (b) The State's long-term strategy for avoiding disruptions to the 
program when new Census or other reliable data become available, or when 
there is over-enrollment for any other reason;
    (c) The State's long-term strategy for serving minority older 
individuals under SCSEP;
    (d) Long-term projections for job growth in industries and 
occupations in the State that may provide employment opportunities for 
older workers, and how those relate to the types of unsubsidized jobs 
for which SCSEP participants will be trained, and the types of skill 
training to be provided;
    (e) The State's long-term strategy for engaging employers to develop 
and promote opportunities for the placement of SCSEP participants in 
unsubsidized employment;
    (f) The State's strategy for continuous improvement in the level of 
performance for entry into unsubsidized employment, and to achieve, at a 
minimum, the levels specified inSec. 513(a)(2)(E)(ii) of the OAA;
    (g) Planned actions to coordinate activities of SCSEP grantees with 
the activities being carried out in the State under title I of WIA, 
including plans for using the WIA One-Stop delivery system and its 
partners to serve individuals aged 55 and older;
    (h) Planned actions to coordinate activities of SCSEP grantees with 
the activities being carried out in the State under other titles of the 
OAA;
    (i) Planned actions to coordinate the SCSEP with other public and 
private entities and programs that provide services to older Americans, 
such as community and faith-based organizations, transportation 
programs, and programs for those with special needs or disabilities;
    (j) Planned actions to coordinate the SCSEP with other labor market 
and job training initiatives; and
    (k) The State's long-term strategy to improve SCSEP services, 
including planned longer-term changes to the design of the program 
within the State, and planned changes in the use of SCSEP grantees and 
program operators to better achieve the goals of the program; this may 
include recommendations to the Department, as appropriate.



Sec.  641.305  Who is responsible for developing and submitting 
the State Plan?

    The Governor, or the highest governmental official, of each State is 
responsible for developing and submitting the State Plan to the 
Department.



Sec.  641.310  May the Governor, or the highest government official,
delegate responsibility for developing and submitting the State Plan?

    (a) Yes, the Governor, or the highest governmental official of each 
State, may delegate responsibility for developing and submitting the 
State Plan, provided that any such delegation is consistent with State 
law and regulations.
    (b) To delegate responsibility, the Governor, or the highest 
government official, must submit to the Department a signed statement 
indicating the individual and/or organization that will be submitting 
the State Plan on his or her behalf.



Sec.  641.315  Who participates in developing the State Plan?

    (a) In developing the State Plan the Governor, or the highest 
government official, must seek the advice and recommendations of 
representatives from:
    (1) The State and area agencies on aging;
    (2) State and local boards under the Workforce Investment Act (WIA);
    (3) Public and private nonprofit agencies and organizations 
providing employment services, including each grantee operating a SCSEP 
project within the State, except as provided inSec. 641.320(b);
    (4) Social service organizations providing services to older 
individuals;
    (5) Grantees under title III of the OAA;
    (6) Affected communities;
    (7) Unemployed older individuals;
    (8) Community-based organizations serving older individuals;
    (9) Business organizations; and
    (10) Labor organizations.
    (b) The Governor, or the highest government official, may also 
obtain the advice and recommendations of other

[[Page 374]]

interested organizations and individuals, including SCSEP program 
participants, in developing the State Plan. (OAASec. 503(a)(2)).



Sec.  641.320  Must all national grantees operating within a State 
participate in the State planning process?

    (a) The eligibility provision at OAASec. 514(c)(6) requires 
national grantees to coordinate activities with other organizations at 
the State and local levels. Therefore, except as provided in paragraph 
(b) of this section, any national grantee that does not participate in 
the State planning process may be deemed ineligible to receive SCSEP 
funds in the following Program Year.
    (b) National grantees serving older American Indians, or Pacific 
Island and Asian Americans, with funds reserved under OAASec. 
506(a)(3), are exempted from the requirement to participate in the State 
planning processes underSec. 503(a)(8) of the OAA. Although these 
national grantees may choose not to participate in the State planning 
process, the Department encourages their participation. Only those 
grantees using reserved funds are exempt; if a grantee is awarded one 
grant with reserved funds and another grant with non-reserved funds, the 
grantee is required under paragraph (a) of this section to participate 
in the State planning process for purposes of the non-reserved funds 
grant.



Sec.  641.325  What information must be provided in the State Plan?

    The Department issues instructions detailing the information that 
must be provided in the State Plan. At a minimum, the State Plan must 
include the State's four-year strategy, as described inSec. 641.302, 
and information on the following:
    (a) The ratio of eligible individuals in each service area to the 
total eligible population in the State;
    (b) The relative distribution of:
    (1) Eligible individuals residing in urban and rural areas within 
the State;
    (2) Eligible individuals who have the greatest economic need;
    (3) Eligible individuals who are minorities;
    (4) Eligible individuals who are limited English proficient; and
    (5) Eligible individuals who have the greatest social need;
    (c) The current and projected employment opportunities in the State 
(such as by providing information available underSec. 15 of the 
Wagner-Peyser Act (29 U.S.C. 491-2) by occupation), and the types of 
skills possessed by eligible individuals;
    (d) The localities and populations for which projects of the type 
authorized by title V are most needed;
    (e) Actions taken and/or planned to coordinate activities of SCSEP 
grantees in the State with activities carried out in the State under 
title I of WIA;
    (f) A description of the process used to obtain advice and 
recommendations on the State Plan from representatives of organizations 
and individuals listed inSec. 641.315, and advice and recommendations 
on steps to coordinate SCSEP services with activities funded under title 
I of WIA from representatives of organizations listed inSec. 641.335;
    (g) A description of the State's procedures and time line for 
ensuring an open and inclusive planning process that provides meaningful 
opportunity for public comment as required bySec. 641.350;
    (h) Public comments received, and a summary of the comments;
    (i) A description of the steps taken to avoid disruptions to the 
greatest extent possible as provided inSec. 641.365; and
    (j) Such other information as the Department may require in the 
State Plan instructions. (OAASec. 503(a)).



Sec.  641.330  How should the State Plan reflect community service 
needs?

    The Governor, or the highest government official, must ensure that 
the State Plan identifies the types of community services that are 
needed and the places where these services are most needed. The State 
Plan should specifically identify the needs and locations of those 
individuals most in need of community services and the groups working to 
meet their needs. (OAASec. 503(a)(4)(E)).

[[Page 375]]



Sec.  641.335  How should the Governor, or the highest government 
official, address the coordination of SCSEP services with activities
funded under title I of WIA?

    The Governor, or the highest government official, must seek the 
advice and recommendations from representatives of the State and area 
agencies on aging in the State and the State and local boards 
established under title I of WIA. (OAASec. 503(a)(2)). The State Plan 
must describe the steps that are being taken to coordinate SCSEP 
activities within the State with activities being carried out under 
title I of WIA. (OAASec. 503(a)(4)(F)). The State Plan must describe 
the steps being taken to ensure that the SCSEP is an active partner in 
each One-Stop delivery system and the steps that will be taken to 
encourage and improve coordination with the One-Stop delivery system.



Sec.  641.340  How often must the Governor, or the highest government
official, update the State Plan?

    (a) Under instructions issued by the Department, the Governor, or 
the highest government official, must review the State Plan and submit 
an update to the State Plan to the Secretary for consideration and 
approval not less often than every two years. OAASec. 503(a)(1). 
States are encouraged to review their State Plan more frequently than 
every two years, however, and make modifications as circumstances 
warrant, underSec. 641.345.
    (b) Before development of the update to the State Plan, the 
Governor, or the highest government official, must seek the advice and 
recommendations of the individuals and organizations identified inSec. 
641.315 about what, if any, changes are needed, and must publish the 
State Plan, showing the changes, for public comment. OAASec. section 
503(a)(2), 503(a)(3).



Sec.  641.345  What are the requirements for modifying the State Plan?

    (a) Modifications may be submitted anytime circumstances warrant.
    (b) Modifications to the State Plan are required when:
    (1) There are changes in Federal or State law or policy that 
substantially change the assumptions upon which the State Plan is based;
    (2) There are significant changes in the State's vision, four-year 
strategy, policies, performance indicators, or organizational 
responsibilities; or
    (3) There is a change in a grantee or grantees.
    (c) Modifications to the State Plan are subject to the same public 
comment requirements that apply to the development of the State Plan 
underSec. 641.350.
    (d) States are not required to seek the advice and recommendations 
of the individuals and organizations identified inSec. 641.315 when 
modifying the State Plan, except that States must seek the advice and 
recommendations of any national grantees operating in the State. While 
not required, states are strongly encouraged to seek the advice and 
recommendation of the relevant entities listed inSec. 641.315 when or 
if modifying the State Plan becomes necessary.
    (e) The Department will issue additional instructions for the 
procedures that must be followed when requesting modifications to the 
State Plan.



Sec.  641.350  How should public comments be solicited and collected?

    The Governor, or the highest government official, should follow 
established State procedures to solicit and collect public comments. The 
State Plan must include a description of the State's procedures and 
schedule for ensuring an open and inclusive planning process that 
provides meaningful opportunity for public comment.



Sec.  641.355  Who may comment on the State Plan?

    Any individual or organization may comment on the Plan.



Sec.  641.360  How does the State Plan relate to the equitable 
distribution report?

    The two documents address some of the same areas, but are prepared 
at different points in time. The equitable distribution report is 
prepared by State grantees at the beginning of each fiscal year and 
provides a ``snapshot'' of the

[[Page 376]]

actual distribution of all of the authorized positions within the State, 
grantee-by-grantee, and the optimum number of participant positions in 
each designated area based on the latest available Census or other 
reliable data. The State Plan is prepared by the Governor, or the 
highest government official, and covers many areas in addition to 
equitable distribution, as discussed inSec. 641.325, and sets forth a 
proposed plan for distribution of authorized positions in the State. Any 
distribution or redistribution of positions made as a result of a State 
Plan proposal will be reflected in the next equitable distribution 
report, which then forms the basis for the proposed distribution in the 
next State Plan update. This process is iterative in that it moves the 
authorized positions from overserved areas to underserved areas over a 
period of time.



Sec.  641.365  How must the equitable distribution provisions be 
reconciled with the provision that disruptions to current 
participants should be avoided?

    (a) Governors, or highest government officials, must describe in the 
State Plan the steps that are being taken to comply with the statutory 
requirement to avoid disruptions in the provision of services for 
participants. (OAASec. 503(a)(6)).
    (b) When there is new Census or other reliable data indicating that 
there has been a shift in the location of the eligible population or 
when there is over-enrollment for any other reason, the Department 
recommends a gradual shift in positions as they become vacant to areas 
where there has been an increase in the eligible population.
    (c) The Department does not define disruptions to mean that 
participants are entitled to remain in a subsidized community service 
assignment indefinitely. As discussed inSec. 641.570, there is a time 
limit on SCSEP participation, thus permitting positions to be 
transferred over time.
    (d) Grantees and sub-recipients must not transfer positions from one 
geographic area to another without first notifying the State agency 
responsible for preparing the State Plan and equitable distribution 
report.
    (e) Grantees must submit, in writing, any proposed changes in 
distribution that occur after submission of the equitable distribution 
report to the Department for approval.
    (f) All grantees are required to coordinate any proposed changes in 
position distribution with the other grantees in the State, including 
the State project director, before submitting the proposed changes to 
the Department for approval. The request for the Department's approval 
must include the comments of the State project director, which the 
Department will consider in making its decision.



 Subpart D_Grant Application and Responsibility Review Requirements for 
                     State and National SCSEP Grants



Sec.  641.400  What entities are eligible to apply to the Department
for funds to administer SCSEP projects?

    (a) National grants. Entities eligible to apply for national grants 
include nonprofit organizations, Federal public agencies, and tribal 
organizations. These entities must provide information to establish that 
they are capable of administering a multi-State program, as required by 
the Secretary. State and local agencies may not apply for these funds.
    (b) State grants. (1) Section 506(e) of the OAA requires the 
Department to award each State a grant to provide SCSEP services. 
Governors, or highest government officials, designate an individual 
State agency as the organization to administer SCSEP funds.
    (2) If the State fails to meet its expected levels of performance 
for the core indicators for three consecutive years, it is not eligible 
to designate an agency to administer SCSEP funds in the following year. 
Instead, the State must conduct a competition to select an organization 
as the grantee of the funds allotted to the State underSec. 506(e). 
Public and nonprofit private agencies and organizations, State agencies 
other than the previously designated, failed agency, and tribal 
organizations, are eligible to be selected as a grantee for the funds. 
Other States may not be selected as a grantee for this funding.

[[Page 377]]



Sec.  641.410  How does an eligible entity apply?

    (a) General. An eligible entity must follow the application 
guidelines issued by the Department. The Department will issue 
application guidelines announcing the availability of national funds and 
State funds, whether they are awarded on a competitive or noncompetitive 
basis. The guidelines will contain application due dates, application 
instructions, evaluation criteria, and other necessary information.
    (b) National grant applicants. All applicants for SCSEP national 
grant funds, except for applications for grants proposing to serve older 
Indians and Pacific Island and Asian Americans with funds reserved under 
OAASec. 506(a)(3), must submit their applications to the Governor, or 
the highest government official, of each State in which projects are 
proposed so that he or she has a reasonable opportunity to make the 
recommendations described inSec. 641.480, before submitting the 
application to the Department. (OAASec. 503(a)(5)).
    (c) State applicants. A State that submits a Unified Plan under 
Sec.  501 of WIA may include the State's SCSEP grant application in its 
Unified Plan. Any State that submits a SCSEP grant application as part 
of its WIA Unified Plan must address all of the application requirements 
as published in the Department's instructions. Sections 641.300 through 
641.365 address State Plans and modifications.



Sec.  641.420  What are the eligibility criteria that each applicant
must meet?

    To be eligible to receive SCSEP funds, each applicant must 
demonstrate:
    (a) An ability to administer a program that serves the greatest 
number of eligible participants, giving particular consideration to 
individuals with greatest economic need, individuals with greatest 
social need, and individuals described inSec. 641.570(b) orSec. 
641.520(a)(2) through (a)(8).
    (b) An ability to administer a program that provides employment in 
community service assignments for eligible individuals in communities in 
which they reside, or in nearby communities, that will contribute to the 
general welfare of the community;
    (c) An ability to administer a program that moves eligible 
participants into unsubsidized employment;
    (d) Where the applicant has previously received a SCSEP grant, the 
applicant's prior performance in meeting SCSEP core measures of 
performance and addressing SCSEP additional measures of performance; and 
where the applicant has not received a SCSEP grant, the applicant's 
prior performance under other Federal or State programs; relevant past 
performance will also be used for scoring criterion and will be set 
forth more fully in the Solicitation for Grant Applications (seeSec. 
641.460);
    (e) An ability to move participants with multiple barriers to 
employment, including individuals described inSec. 641.570(b) orSec. 
641.520(a)(2) through (a)(8), into unsubsidized employment;
    (f) An ability to coordinate activities with other organizations at 
the State and local levels, including the One-Stop delivery system;
    (g) An ability to properly manage the program, as reflected in its 
plan for fiscal management of the SCSEP;
    (h) An ability to administer a project that provides community 
service;
    (i) An ability to minimize program disruption for current 
participants and in community services provided if there is a change in 
project sponsor and/or location, and its plan for minimizing 
disruptions;
    (j) Any additional criteria that the Department deems appropriate to 
minimize disruptions for current participants. (OAASec. 514(c)).



Sec.  641.430  What are the responsibility conditions that an 
applicant must meet?

    Subject toSec. 641.440, each applicant must meet the listed 
responsibility ``tests'' by not having committed the following acts:
    (a) The Department has been unable to recover a debt from the 
applicant, whether incurred by the applicant or by one of its sub-
recipients, or the applicant has failed to comply with a debt repayment 
plan to which it agreed. In this context, a debt is established by final 
agency action, followed

[[Page 378]]

by three demand letters to the applicant, without payment in full by the 
applicant.
    (b) Established fraud or criminal activity of a significant nature 
within the applicant's organization.
    (c) Serious administrative deficiencies identified by the 
Department, such as failure to maintain a financial management system as 
required by Federal regulations.
    (d) Willful obstruction of the auditing or monitoring process.
    (e) Failure to provide services to applicants as agreed to in a 
current or recent grant or to meet applicable core performance measures 
or address other applicable indicators of performance.
    (f) Failure to correct deficiencies brought to the grantee's 
attention in writing as a result of monitoring activities, reviews, 
assessments, or other activities.
    (g) Failure to return a grant closeout package or outstanding 
advances within 90 days after the grant expiration date or receipt of 
closeout package, whichever is later, unless an extension has been 
requested and granted.
    (h) Failure to submit required reports.
    (i) Failure to properly report and dispose of Government property as 
instructed by the Department.
    (j) Failure to have maintained effective cash management or cost 
controls resulting in excess cash on hand.
    (k) Failure to ensure that a sub-recipient complies with applicable 
audit requirements, including OMB Circular A-133 and the audit 
requirements specified atSec. 641.821.
    (l) Failure to audit a sub-recipient within the period required 
underSec. 641.821.
    (m) Final disallowed costs in excess of five percent of the grant or 
contract award if, in the judgment of the Grant Officer, the 
disallowances are egregious findings.
    (n) Failure to establish a mechanism to resolve a sub-recipient's 
audit in a timely fashion. (OAASec. 514(d)(4)).



Sec.  641.440  Are there responsibility conditions that alone will 
disqualify an applicant?

    (a) Yes, an applicant may be disqualified if
    (1) Either of the first two responsibility tests, a or b, listed in 
Sec.  641.430 is not met, or
    (2) The applicant substantially, or persistently for two or more 
consecutive years, fails one of the other responsibility tests listed in 
Sec.  641.430.
    (b) The second responsibility test addresses ``fraud or criminal 
activity of a significant nature.'' The Department will determine the 
existence of significant fraud or criminal activity which typically will 
include willful or grossly negligent disregard for the use or handling 
of, or other fiduciary duties concerning, Federal funding, where the 
grantee has no effective systems, checks, or safeguards to detect or 
prevent fraud or criminal activity. Additionally, significant fraud or 
criminal activity will typically include coordinated patterns or 
behaviors that pervade a grantee's administration or are committed by 
the higher levels of a grantee's management or authority. The Department 
will determine whether ``fraud or criminal activity of a significant 
nature'' has occurred on a case-by-case basis, regardless of what party 
identifies the alleged fraud or criminal activity.



Sec.  641.450  How will the Department examine the responsibility of
eligible entities?

    The Department will review available records to assess each 
applicant's overall fiscal and administrative ability to manage Federal 
funds. The Department's responsibility review may consider all relevant 
information, including the organization's history of managing other 
grants awarded by the Department or by other Federal agencies. (OAA 
Sec.  514(d)(1) and (d)(2)).



Sec.  641.460  What factors will the Department consider in selecting 
national grantees?

    The Department will select national grantees from among applicants 
that are able to meet the eligibility and responsibility review criteria 
atSec. 514 of the OAA. (Section 641.420 contains the eligibility 
criteria and Sec.Sec. 641.430 and 641.440 contain the responsibility 
criteria.) The Department also will take the rating criteria described 
in the Solicitation for Grant Applications or

[[Page 379]]

other instrument into consideration. These rating criteria will include 
relevant past performance.



Sec.  641.465  Under what circumstances may the Department reject an
application?

    (a) The Department may question any proposed project component of an 
application if it believes that the component will not serve the 
purposes of the SCSEP. The Department may reject the application if the 
applicant does not submit or negotiate an acceptable alternative.
    (b) The Department may reject any application that the Grant Officer 
determines unacceptable based on the content of the application, rating 
score, past performance, fiscal management, or any other factor the 
Grant Officer believes serves the best interest of the program, 
including the application's comparative rating in a competition.



Sec.  641.470  What happens if an applicant's application is rejected?

    (a) Any entity whose application is rejected in whole or in part 
will be informed that it has not been selected. The non-selected entity 
may request an explanation of the Department's basis for its rejection. 
If requested, the Department will provide the entity with feedback on 
its proposal. The non-selected entity may follow the procedures inSec. 
641.900.
    (b) Incumbent grantees will not have an opportunity to obtain 
technical assistance provided by the Department under OAASec. 
513(d)(2)(B)(i) to cure, in an open competition, any deficiency in a 
proposal because that will create inequity in favor of incumbents. Nor, 
during an open competition, will the Department provide assistance to 
any applicant to improve its application.
    (c) If the Administrative Law Judge (ALJ) rules, underSec. 
641.900, that the organization should have been selected, in whole or in 
part, the matter must be remanded to the Grant Officer. The Grant 
Officer must, within 10 working days, determine whether the organization 
continues to meet the requirements of this part, and whether the 
positions which are the subject of the ALJ's decision will be awarded, 
in whole or in part, to the organization and the timing of the award. In 
making this determination, the Grant Officer must take into account 
disruption to participants, disruption to grantees, and the operational 
needs of the SCSEP.
    (d) In the event that the Grant Officer determines that it is not 
feasible to award any positions to the appealing applicant, the 
applicant will be awarded its bid preparation costs, or a pro rata share 
of those costs if the Grant Officer's finding applies to only a portion 
of the funds that would be awarded. If positions are awarded to the 
appealing applicant, that applicant is not entitled to the full grant 
amount but will only receive the funds remaining in the grant that have 
not been expended by the current grantee through its operation of the 
grant and its subsequent closeout. The available remedy in a SCSEP non-
selection appeal is neither retroactive nor immediately effective 
selection; rather it is the potential to be selected as a SCSEP grantee 
as quickly as administratively feasible in the future, for the remainder 
of the grant cycle.
    (e) In the event that any party notifies the Grant Officer that it 
is not satisfied with the Grant Officer's decision, the Grant Officer 
must return the decision to the ALJ for review.
    (f) Any organization selected and/or funded as a SCSEP grantee is 
subject to having its positions reduced or to being removed as a SCSEP 
grantee if an ALJ decision so orders. The Grant Officer provides 
instructions on transition and closeout to both the newly designated 
grantee and to the grantee whose positions are affected or which is 
being removed. All parties must agree to the provisions of this 
paragraph as a condition of being a SCSEP grantee.



Sec.  641.480  May the Governor, or the highest government official,
make recommendations to the Department on national grant applications?

    (a) Yes, in accordance withSec. 641.410(b), each Governor, or 
highest government official, will have a reasonable opportunity to make 
comments on any application to operate a

[[Page 380]]

SCSEP project located in the Governor's, or the highest government 
official's, State before the Department makes a final decision on a 
grant award. The Governor's, or the highest government official's, 
comments should be directed to the Department and may include the 
anticipated effect of the proposal on the overall distribution of 
program positions within the State; recommendations for redistribution 
of positions to underserved areas as vacancies occur in previously 
encumbered positions in other areas; and recommendations for 
distributing any new positions that may become available as a result of 
an increase in funding for the State. The Governor's, or the highest 
government official's, recommendations should be consistent with the 
State Plan. (OAASec. 503(a)(5)).
    (b) The Governor, or the highest government official, has the option 
of making the authorized recommendations on all applications or only on 
those applications proposed for award following the rating process. It 
is incumbent on each Governor, or the highest government official, to 
inform the Department of his or her intent to review the applications 
before or after the rating process.



Sec.  641.490  When will the Department compete SCSEP grant awards?

    (a)(1) The Department will hold a full and open competition for 
national grants every four years. (OAASec. 514(a)(1)).
    (2) If a national grantee meets the expected level of performance 
for each of the core indicators for each of the four years, the 
Department may provide an additional one-year grant to the national 
grantee. (OAASec. 514(a)(2)).



Sec.  641.495  When must a State compete its SCSEP award?

    If a State grantee fails to meet its expected levels of performance 
for three consecutive Program Years, the State must hold a full and open 
competition, under such conditions as the Secretary may provide, for the 
State SCSEP funds for the full Program Year following the determination 
of consecutive failure. (OAASec. 513(d)(3)(B)(iii)). The incumbent 
(failed) grantee is not eligible to compete. Other states are also not 
eligible to compete for these funds.Sec. 641.400(b)(2).



                   Subpart E_Services to Participants



Sec.  641.500  Who is eligible to participate in the SCSEP?

    Anyone who is at least 55 years old, unemployed (as defined inSec. 
641.140), and who is a member of a family with an income that is not 
more than 125 percent of the family income levels prepared by the 
Department of Health and Human Services and approved by OMB (Federal 
poverty guidelines) is eligible to participate in the SCSEP. (OAASec. 
518(a)(3), (8)). A person with a disability may be treated as a ``family 
of one'' for income eligibility determination purposes at the option of 
the applicant.



Sec.  641.505  When is eligibility determined?

    Initial eligibility is determined at the time individuals apply to 
participate in the SCSEP. Once individuals become SCSEP participants, 
the grantee or sub-recipient is responsible for verifying their 
continued eligibility at least once every 12 months. Grantees and sub-
recipients may also verify an individual's eligibility as circumstances 
require, including instances when enrollment is delayed.



Sec.  641.507  How is applicant income computed?

    An applicant's income is computed by calculating the includable 
income received by the applicant during the 12-month period ending on 
the date an individual submits an application to participate in the 
SCSEP, or the annualized income for the 6-month period ending on the 
application date. The Department requires grantees to use whichever 
method is more favorable to the individual. (OAASec. 518(a)(4)).



Sec.  641.510  What types of income are included and excluded for 
participant eligibility determinations?

    (a) With certain exceptions, the Department will use the definition 
of income from the U.S. Census Bureau's Current Population Survey (CPS) 
as

[[Page 381]]

the standard for determining SCSEP applicant income eligibility.
    (b) Any income that is unemployment compensation, a benefit received 
under title XVI of the Social Security Act (42 U.S.C. 1381 et seq.), a 
payment made to or on behalf of veterans or former members of the Armed 
Forces under the laws administered by the Secretary of Veterans Affairs, 
or 25 percent of a benefit received under title II of the Social 
Security Act (42 U.S.C. 401 et seq.), must be excluded from SCSEP income 
eligibility determinations. (OAASec. 518(a)(3)(A)).
    (c) The Department has issued administrative guidance on income 
inclusions and exclusions and procedures for determining SCSEP income 
eligibility. This guidance may be updated periodically.



Sec.  641.512  May grantees and sub-recipients enroll otherwise 
eligible job ready individuals and place them directly into 
unsubsidized employment?

    No, grantees and sub-recipients may not enroll as SCSEP participants 
job-ready individuals who can be directly placed into unsubsidized 
employment. Such individuals should be referred to an employment 
provider, such as the One-Stop Center for job placement assistance under 
WIA or another employment program.



Sec.  641.515  How must grantees and sub-recipients recruit and select
eligible individuals for participation in the SCSEP?

    (a) Grantees and sub-recipients must develop methods of recruitment 
and selection that assure that the maximum number of eligible 
individuals have an opportunity to participate in the program. To the 
extent feasible, grantees and sub-recipients should seek to enroll 
minority and Indian eligible individuals, eligible individuals with 
limited English proficiency, and eligible individuals with greatest 
economic need, at least in proportion to their numbers in the area, 
taking into consideration their rates of poverty and unemployment. (OAA 
Sec.  502(b)(1)(M)).
    (b) Grantees and sub-recipients must use the One-Stop delivery 
system as one method in the recruitment and selection of eligible 
individuals to ensure that the maximum number of eligible individuals 
have an opportunity to participate in the project. (OAASec. 
502(b)(1)(H)).
    (c) States may enter into agreements among themselves to permit 
cross-border enrollment of eligible participants. Such agreements should 
cover both State and national grantee positions and must be submitted to 
the Department for approval in the grant application or a modification 
of the grant.



Sec.  641.520  Are there any priorities that grantees and
sub-recipients must use in selecting eligible individuals for 
participation in the SCSEP?

    (a) Yes, in selecting eligible individuals for participation in the 
SCSEP, priority must be given to individuals who have one or more of the 
following characteristics:
    (1) Are 65 years of age or older;
    (2) Have a disability;
    (3) Have limited English proficiency or low literacy skills;
    (4) Reside in a rural area;
    (5) Are veterans (or, in some cases, spouses of veterans) for 
purposes ofSec. 2(a) of the Jobs for Veterans Act, 38 U.S.C. 4215(a) 
as set forth in paragraph (b) of this section;
    (6) Have low employment prospects;
    (7) Have failed to find employment after using services provided 
through the One-Stop delivery system; or
    (8) Are homeless or are at risk for homelessness. (OAASec. 
518(b)).
    (b) Section 2(a) of the Jobs for Veterans Act creates a priority for 
service for veterans (and, in some cases, spouses of veterans) who 
otherwise meet the program eligibility criteria for the SCSEP. 38 U.S.C. 
4215(a). Priority is extended to veterans. Priority is also extended to 
the spouse of a veteran who died of a service-connected disability; the 
spouse of a member of the Armed Forces on active duty who has been 
listed for a total of more than 90 days as missing in action, captured 
in the line of duty by a hostile force, or forcibly detained by a 
foreign government or power; the spouse of any veteran who has a total 
disability resulting from a service-connected disability; and the spouse 
of any veteran who died while a disability so evaluated was in 
existence.

[[Page 382]]

    (c) Grantees and sub-recipients must apply these priorities in the 
following order:
    (1) Persons who qualify as a veteran or qualified spouse underSec. 
2(a) of the Jobs for Veterans Act, 38 U.S.C. 4215(a), and who possess at 
least one of the other priority characteristics;
    (2) Persons who qualify as a veteran or qualified spouse underSec. 
2(a) of the Jobs for Veterans Act, 38 U.S.C. 4215(a), who do not possess 
any other of the priority characteristics;
    (3) Persons who do not qualify as a veteran or qualified spouse 
underSec. 2(a) of the Jobs for Veterans Act (non-veterans), and who 
possess at least one of the other priority characteristics.



Sec.  641.535  What services must grantees and sub-recipients provide
to participants?

    (a) When individuals are selected for participation in the SCSEP, 
the grantee or sub-recipient is responsible for:
    (1) Providing orientation to the SCSEP, including information on 
project goals and objectives, community service assignments, training 
opportunities, available supportive services, the availability of a free 
physical examination, participant rights and responsibilities, and 
permitted and prohibited political activities;
    (2)(i) Assessing participants' work history, skills and interests, 
talents, physical capabilities, aptitudes, needs for supportive 
services, occupational preferences, training needs, potential for 
performing community service assignments, and potential for transition 
to unsubsidized employment;
    (ii) Performing an initial assessment upon program entry, unless an 
assessment has already been performed under title I of WIA as provided 
inSec. 641.230. Subsequent assessments may be made as necessary, but 
must be made no less frequently than two times during a twelve month 
period (including the initial assessment);
    (3)(i) Using the information gathered during the initial assessment 
to develop an IEP that includes an appropriate employment goal for each 
participant, except that if an assessment has already been performed and 
an IEP developed under title I of WIA, the WIA assessment and IEP will 
satisfy the requirement for a SCSEP assessment and IEP as provided in 
Sec.  641.230;
    (ii) Updating the IEP as necessary to reflect information gathered 
during the subsequent participant assessments (OAASec. 502(b)(1)(N));
    (iii) The initial IEP should include an appropriate employment goal 
for each participant. Thereafter, if the grantee determines that the 
participant is not likely to obtain unsubsidized employment, the IEP 
must reflect other approaches to help the participant achieve self-
sufficiency, including the transition to other services or programs.
    (4) Placing participants in appropriate community service 
assignments in the community in which they reside, or in a nearby 
community (OAASec. 502(b)(1)(B));
    (5) Providing or arranging for training identified in participants' 
IEPs and consistent with the SCSEP's goal of unsubsidized employment 
(OAASec. 502(a)(1), 502(b)(1)(B), 502(b)(1)(I), 502(b)(1)(N)(ii));
    (6) Assisting participants in obtaining needed supportive services 
identified in their IEPs (OAASec. 502(b)(1)(N));
    (7) Providing appropriate services for participants, or referring 
participants to appropriate services, through the One-Stop delivery 
system established under WIA (OAASec. 502(b)(1)(O));
    (8) Providing counseling on participants' progress in meeting the 
goals and objectives identified in their IEPs, and in meeting their 
supportive service needs (OAASec. 502(b)(1)(N)(iii));
    (9) Providing participants with wages and benefits for time spent in 
the community service assignment, orientation, and training (OAASec. 
502(b)(1)(I), 502(b)(1)(J), 502(c)(6)(A)(i)) (see also Sec.Sec. 
641.565 and 641.540(f), addressing wages and benefits);
    (10) Ensuring that participants have safe and healthy working 
conditions at their community service employment worksites (OAASec. 
502(b)(1)(J));
    (11) Assisting participants in obtaining unsubsidized employment, 
including providing or arranging for employment counseling in support of 
their IEPs;
    (b) The Department may issue administrative guidance that clarifies 
the requirements of paragraph (a).

[[Page 383]]

    (c) Grantees may not use SCSEP funds for job ready individuals who 
only need job search assistance or job referral services. Grantees may 
provide job search assistance and job club activities to participants 
who are enrolled in the SCSEP and are assigned to community service 
assignments. (See alsoSec. 641.512).



Sec.  641.540  What types of training may grantees and sub-recipients
provide to SCSEP participants in addition to the training received at
a community service assignment?

    (a) In addition to the training provided in a community service 
assignment, grantees and sub-recipients may arrange skill training 
provided that it:
    (1) Is realistic and consistent with the participants' IEP;
    (2) Makes the most effective use of the participant's skills and 
talents; and
    (3) Prepares the participant for unsubsidized employment.
    (b) Training may be provided before or during a community service 
assignment.
    (c) Training may be in the form of lectures, seminars, classroom 
instruction, individual instruction, online instruction, on-the-job 
experiences. Training may be provided by the grantee or through other 
arrangements, including but not limited to, arrangements with other 
workforce development programs such as WIA. (OAASec. 
502(c)(6)(A)(ii)).
    (d) Grantees and sub-recipients are encouraged to obtain training 
through locally available resources, including host agencies, at no cost 
or reduced cost to the SCSEP.
    (e) Grantees and sub-recipients may pay for participant training, 
including the payment of reasonable costs of instructors, classroom 
rental, training supplies, materials, equipment, and tuition. (OAASec. 
502(c)(6)(A)(ii)).
    (f) Participants must be paid wages while in training, as described 
inSec. 641.565(a). (OAASec. 502(b)(1)(I)).
    (g) As provided inSec. 641.545, grantees and sub-recipients may 
pay for costs associated with supportive services, such as 
transportation, necessary to participate in training. (OAASec. 
502(b)(1)(L)).
    (h) Nothing in this section prevents or limits participants from 
engaging in self-development training available through other sources, 
at their own expense, during hours when not performing their community 
service assignments.



Sec.  641.545  What supportive services may grantees and 
sub-recipients provide to participants?

    (a) Grantees and sub-recipients are required to assess all 
participants' need for supportive services and to make every effort to 
assist participants in obtaining needed supportive services. Grantees 
and sub-recipients may provide directly or arrange for supportive 
services that are necessary to enable an individual to successfully 
participate in a SCSEP project, including but not limited to payment of 
reasonable costs of transportation; health and medical services; special 
job-related or personal counseling; incidentals such as work shoes, 
badges, uniforms, eyeglasses, and tools; dependent care; housing, 
including temporary shelter; needs-related payments; and follow-up 
services. (OAA Sec.Sec. 502(c)(6)(A)(iv), 518(a)(7)).
    (b) To the extent practicable, the grantee or sub-recipient should 
arrange for the payment of these expenses from other resources.
    (c) Grantees and sub-recipients are encouraged to contact placed 
participants throughout the first 12 months following placement to 
determine if they have the necessary supportive services to remain in 
the job and to provide or arrange to provide such services if feasible.



Sec.  641.550  What responsibility do grantees and sub-recipients have
to place participants in unsubsidized employment?

    For those participants whose IEPs include a goal of unsubsidized 
employment, grantees and sub-recipients are responsible for working with 
participants to ensure that the participants are receiving services and 
taking actions designed to help them achieve this goal. Grantees and 
sub-recipients must contact private and public employers directly or 
through the One-Stop delivery system to develop or

[[Page 384]]

identify suitable unsubsidized employment opportunities. They must also 
encourage host agencies to assist participants in their transition to 
unsubsidized employment, including unsubsidized employment with the host 
agency.



Sec.  641.565  What policies govern the provision of wages and
benefits to participants?

    (a) Wages. (1)(i) Grantees and sub-recipients must pay participants 
the highest applicable required wage for time spent in orientation, 
training, and community service assignments.
    (ii) SCSEP participants may be paid the highest applicable required 
wage while receiving WIA intensive services.
    (2) The highest applicable required wage is either the minimum wage 
applicable under the Fair Labor Standards Act of 1938; the State or 
local minimum wage for the most nearly comparable covered employment; or 
the prevailing rate of pay for persons employed in similar public 
occupations by the same employer.
    (3) Grantees and sub-recipients must make any adjustments to minimum 
wage rates payable to participants as may be required by Federal, State, 
or local statute during the grant term.
    (b) Benefits--(1) Required benefits. Except as provided in paragraph 
(b)(2) of this section, grantees and sub-recipients must ensure that 
participants receive such benefits as are required by law.
    (i) Grantees and sub-recipients must provide benefits uniformly to 
all participants within a project or subproject, unless the Department 
agrees to waive this provision due to a determination that such a waiver 
is in the best interests of applicants, participants, and project 
administration.
    (ii) Grantees and sub-recipients must offer participants the 
opportunity to receive physical examinations annually.
    (A) Physical examinations are a benefit, and not an eligibility 
criterion. The examining physician must provide, to the participant 
only, a written report of the results of the examination.
    (B) Participants may choose not to accept the physical examination. 
In that case, the grantee or sub-recipient must document this refusal, 
through a signed statement, within 60 workdays after commencement of the 
community service assignment. Each year thereafter, grantees and sub-
recipients must offer the physical examination and document the offer 
and any participant's refusal.
    (C) Grantees and sub-recipients may use SCSEP funds to pay the costs 
of physical examinations.
    (iii) When participants are not covered by the State workers' 
compensation law, the grantee or sub-recipient must provide participants 
with workers' compensation benefits equal to those provided by law for 
covered employment. OAASec. 504(b).
    (iv) If required by State law, grantees/sub-recipients must provide 
unemployment compensation coverage for participants.
    (v) Grantees and sub-recipients must provide compensation for 
scheduled work hours during which a host agency's business is closed for 
a Federal holiday, which may be paid or in the form of rescheduled work 
time.
    (vi) Grantees and sub-recipients must provide necessary sick leave 
that is not part of an accumulated sick leave program, which may be paid 
or in the form of rescheduled work time.
    (2) Prohibited wage and benefits costs. (i) Participants may not 
carry over allowable benefits from one Program Year to the next;
    (ii) Grantees and sub-recipients may not provide payment or 
otherwise compensate participants for unused benefits such as sick leave 
or holidays;
    (iii) Grantees and sub-recipients may not use SCSEP funds to cover 
costs associated with the following participant benefits:
    (A) Retirement. Grantees and sub-recipients may not use SCSEP funds 
to provide contributions into a retirement system or plan, or to pay the 
cost of pension benefits for program participants.
    (B) Annual leave.
    (C) Accumulated sick leave.
    (D) Bonuses. (OAASec. 502(c)(6)(A)(i)).

[[Page 385]]



Sec.  641.570  Is there a time limit for participation in the program?

    (a) Individual time limit. (1) Eligible individuals may participate 
in the program for a maximum duration of 48 months in the aggregate 
(whether or not consecutive), from the later of July 1, 2007, or the 
date of the individual's enrollment in the program.
    (2) At the time of enrollment, the grantee or sub-recipient must 
inform the participant of this time limit and the possible extension 
available under paragraph (b) of this section, and the grantee or sub-
recipient must provide for a system to transition participants to 
unsubsidized employment or other assistance before the maximum 
enrollment duration has expired. Provisions for transition must be 
reflected in the participant's IEP.
    (3) If requested by a grantee or sub-recipient, the Department will 
authorize an extension for individuals who meet the criteria in 
paragraph (b) of this section. Notwithstanding any individual extensions 
granted, grantees and sub-recipients must ensure that projects do not 
exceed the overall average participation cap for all participants, as 
described in paragraph (c) of this section.
    (b) Increased periods of individual participation. If requested by a 
grantee, the Department will authorize increased periods of 
participation for individuals who:
    (1) Have a severe disability;
    (2) Are frail or are age 75 or older;
    (3) Meet the eligibility requirements related to age for, but do not 
receive, benefits under title II of the Social Security Act (42 U.S.C. 
401 et seq.);
    (4) Live in an area with persistent unemployment and are individuals 
with severely limited employment prospects; or
    (5) Have limited English proficiency or low literacy skills.
    (c) Average grantee participation cap. (1) Notwithstanding any 
individual extension authorized under paragraph (b) of this section, 
each grantee must manage its SCSEP project in such a way that the 
grantee does not exceed an average participation cap for all 
participants of 27 months (in the aggregate).
    (2) A grantee may request, and the Department may authorize, an 
extended average participation period of up to 36 months (in the 
aggregate) for a particular project area in a given Program Year if the 
Department determines that extenuating circumstances exist to justify an 
extension, due to one more of the following factors:
    (i) High rates of unemployment or of poverty or of participation in 
the program of block grants to States for temporary assistance for needy 
families established under part A of title IV of the Social Security 
Act, in the areas served by a grantee, relative to other areas of the 
State involved or the Nation;
    (ii) Significant downturns in the economy of an area served by the 
grantee or in the national economy;
    (iii) Significant numbers or proportions of participants with one or 
more barriers to employment, including ``most-in-need'' individuals 
described inSec. 641.710(a)(6), served by a grantee relative to such 
numbers or proportions for grantees serving other areas of the State or 
Nation;
    (iv) Changes in Federal, State, or local minimum wage requirements; 
or
    (v) Limited economies of scale for the provision of community 
service employment and other authorized activities in the areas served 
by the grantee.
    (3) For purposes of the average participation cap, each grantee will 
be considered to be one project.
    (d) Authorized break in participation. On occasion a participant 
takes an authorized break in participation from the program, such as a 
formal leave of absence necessitated by personal circumstances or a 
break caused because a suitable community service assignment is not 
available. Such an authorized break, if taken under a formal grantee 
policy allowing such breaks and formally entered into the SCSEP 
Performance and Results Quarterly Performance Reporting (SPARQ) system, 
will not count toward the individual time limit described in paragraph 
(a) or the average participation cap described in paragraph (c) of this 
section.
    (e) Administrative guidance. The Department will issue 
administrative guidance detailing the process by which a grantee may 
request increased

[[Page 386]]

periods of individual participation, and the process by which a grantee 
may request an extension of the average participation cap. The process 
will require that the determination of individual participant extension 
requests is made in a fair and equitable manner.
    (f) Grantee authority. Grantees may limit the time of participation 
for individuals to less than the 48 months described in paragraph (a) of 
this section, if the grantee uniformly applies the lower participation 
limit, and if the grantee submits a description of the lower 
participation limit policy in its grant application or modification of 
the grant and the Department approves the policy. (OAA Sec.Sec. 
502(b)(1)(C), 518(a)(3)(B)).



Sec.  641.575  May a grantee or sub-recipient establish a limit on 
the amount of time its participants may spend at a host agency?

    Yes, grantees and sub-recipients may establish limits on the amount 
of time that participants spend at a particular host agency, and are 
encouraged to rotate participants among different host agencies, or to 
different assignments within the same host agency, as such rotations may 
increase participants' skills development and employment opportunities. 
Such limits must be established in the grant agreement or modification 
of the grant, and approved by the Department. The Department will not 
approve any limit that does not require an individualized determination 
that rotation is in the best interest of the participant and will 
further the acquisition of skills listed in the IEP. Host agency 
rotations have no effect on either the individual participation limit or 
the average participation cap.



Sec.  641.577  Is there a limit on community service assignment
hours?

    While there is no specific limit on the number of hours that may be 
worked in a community service assignment, a community service assignment 
must be a part-time position. However, the Department strongly 
encourages grantees to use 1,300 hours as a benchmark and good practice 
for monitoring community service hours.



Sec.  641.580  Under what circumstances may a grantee or sub-recipient
terminate a participant?

    (a) If, at any time, a grantee or sub-recipient determines that a 
participant was incorrectly declared eligible as a result of false 
information knowingly given by that individual, the grantee or sub-
recipient must give the participant immediate written notice explaining 
the reason(s) for termination and may terminate the participant 30 days 
after it has provided the participant with written notice.
    (b) If, during eligibility verification underSec. 641.505, a 
grantee or sub-recipient finds a participant to be no longer eligible 
for enrollment, the grantee or sub-recipient must give the participant 
written notice explaining the reason(s) for termination and may 
terminate the participant 30 days after it has provided the participant 
with written notice.
    (c) If, at any time, the grantee or sub-recipient determines that it 
incorrectly determined a participant to be eligible for the program 
through no fault of the participant, the grantee or sub-recipient must 
give the participant immediate written notice explaining the reason(s) 
for termination and may terminate the participant 30 days after it has 
provided the participant with written notice.
    (d) A grantee or sub-recipient may terminate a participant for 
cause. Grantees must include their policies concerning for-cause 
terminations in the grant application and obtain the Department's 
approval. The grantee or sub-recipient must give the participant written 
notice explaining the reason(s) for termination and may terminate the 
participant 30 days after it has provided the participant with written 
notice.
    (e) A grantee or sub-recipient may terminate a participant if the 
participant refuses to accept a reasonable number of job offers or 
referrals to unsubsidized employment consistent with the IEP and there 
are no extenuating circumstances that would hinder the participant from 
moving to unsubsidized employment. The grantee or sub-recipient must 
give the participant written notice explaining the reason(s) for 
termination and may terminate the

[[Page 387]]

participant 30 days after it has provided the participant with written 
notice.
    (f) When a grantee or sub-recipient makes an unfavorable 
determination of enrollment eligibility under paragraph (b) or (c) of 
this section, it should refer the individual to other potential sources 
of assistance, such as the One-Stop delivery system. When a grantee or 
sub-recipient terminates a participant under paragraph (d) or (e) of 
this section, it may refer the individual to other potential sources of 
assistance, such as the One-Stop delivery system.
    (g) Grantees and sub-recipients must provide each participant at the 
time of enrollment with a written copy of its policies for terminating a 
participant for cause or otherwise, and must verbally review those 
policies with each participant.
    (h) Any termination, as described in paragraphs (a) through (e) of 
this section, must be consistent with administrative guidelines issued 
by the Department and the termination notice must inform the participant 
of the grantee's grievance procedure, and the termination must be 
subject to the applicable grievance procedures described inSec. 
641.910.
    (i) Participants may not be terminated from the program solely on 
the basis of their age. Grantees and sub-recipients may not impose an 
upper age limit for participation in the SCSEP.



Sec.  641.585  What is the employment status of SCSEP participants?

    (a) Participants are not considered Federal employees solely as a 
result of their participation in the SCSEP. (OAASec. 504(a)).
    (b) Grantees must determine whether or not a participant qualifies 
as an employee of the grantee, sub-recipient, local project, or host 
agency, under applicable law. Responsibility for this determination 
rests with the grantee even when a Federal agency is a grantee or host 
agency.



         Subpart F_Pilot, Demonstration, and Evaluation Projects



Sec.  641.600  What is the purpose of the pilot, demonstration, and
evaluation projects authorized underSec. 502(e) of the OAA?

    The purpose of the pilot, demonstration, and evaluation projects 
authorized underSec. 502(e) of the OAA is to develop and implement 
techniques and approaches, and to demonstrate the effectiveness of these 
techniques and approaches, in addressing the employment and training 
needs of individuals eligible for SCSEP.



Sec.  641.610  How are pilot, demonstration, and evaluation projects
administered?

    The Department may enter into agreements with States, public 
agencies, nonprofit private organizations, or private business concerns, 
as may be necessary, to conduct pilot, demonstration, and evaluation 
projects.



Sec.  641.620  How may an organization apply for pilot, demonstration,
and evaluation project funding?

    Organizations applying for pilot, demonstration, and evaluation 
project funding must follow the instructions issued by the Department. 
Instructions for these unique funding opportunities are published in 
TEGLs available at http://www.doleta.gov/Seniors.



Sec.  641.630  What pilot, demonstration, and evaluation project 
activities are allowable underSec. 502(e)?

    Allowable pilot, demonstration and evaluation projects include:
    (a) Activities linking businesses and eligible individuals, 
including activities providing assistance to participants transitioning 
from subsidized activities to private sector employment;
    (b) Demonstration projects and pilot projects designed to:
    (1) Attract more eligible individuals into the labor force;
    (2) Improve the provision of services to eligible individuals under 
One-Stop delivery systems established under title I of WIA;
    (3) Enhance the technological skills of eligible individuals; and

[[Page 388]]

    (4) Provide incentives to SCSEP grantees for exemplary performance 
and incentives to businesses to promote their participation in the 
SCSEP;
    (c) Demonstration projects and pilot projects, as described in 
paragraph (b) of this section, for workers who are older individuals 
(but targeted to eligible individuals) only if such demonstration 
projects and pilot projects are designed to assist in developing and 
implementing techniques and approaches in addressing the employment and 
training needs of eligible individuals;
    (d) Provision of training and technical assistance to support a 
SCSEP project;
    (e) Dissemination of best practices relating to employment of 
eligible individuals; and
    (f) Evaluation of SCSEP activities.



Sec.  641.640  Should pilot, demonstration, and evaluation project
entities coordinate with SCSEP grantees and sub-recipients, including
area agencies on aging?

    (a) To the extent practicable, the Department will provide an 
opportunity, before the development of a demonstration or pilot project, 
for the appropriate area agency on aging and SCSEP grantees and sub-
grantees to submit comments on the project in order to ensure 
coordination of SCSEP activities with activities carried out under this 
subpart.
    (b) To the extent practicable, entities carrying out pilot, 
demonstration, and evaluation projects must consult with appropriate 
area agencies on aging, SCSEP grantees and sub-grantees, and other 
appropriate agencies and entities to promote coordination of SCSEP and 
pilot, demonstration, and evaluation activities. (OAASec. 502(e)).



                  Subpart G_Performance Accountability



Sec.  641.700  What performance measures/indicators apply to SCSEP 
grantees?

    (a) Indicators of performance. There are currently eight performance 
measures, of which six are core indicators and two are additional 
indicators. Core indicators (defined inSec. 641.710) are subject to 
goal-setting and corrective action (described inSec. 641.720); that 
is, performance level goals for each core indicator must be agreed upon 
between the Department and each grantee before the start of each program 
year, and if a grantee fails to meet the performance level goals for the 
core indicators, that grantee is subject to corrective action. 
Additional indicators (defined inSec. 641.710) are not subject to 
goal-setting and are, therefore, also not subject to corrective action.
    (b) Core indicators. Section 513(b)(1) of the 2006 OAA establishes 
the following core indicators of performance:
    (1) Hours (in the aggregate) of community service employment;
    (2) Entry into unsubsidized employment;
    (3) Retention in unsubsidized employment for six months;
    (4) Earnings;
    (5) The number of eligible individuals served; and
    (6) The number of most-in-need individuals served (the number of 
participating individuals described inSec. 518(a)(3)(B)(ii) or (b)(2) 
of the OAA).
    (c) Additional indicators. Section 513(b)(2) of the 2006 OAA 
establishes the following additional indicators of performance:
    (1) Retention in unsubsidized employment for one year; and
    (2) Satisfaction of the participants, employers, and their host 
agencies with their experiences and the services provided.
    (3) Any other indicators of performance that the Secretary 
determines to be appropriate to evaluate services and performance.
    (4) The Secretary has designated entry into volunteer work as an 
additional indicator.
    (d) Affected entities. The core indicators of performance and 
additional indicators of performance are applicable to each grantee 
without regard to whether the grantee operates the program directly or 
through sub-contracts, sub-grants, or agreements with other entities. 
Grantees must assure that their sub-grantees and lower-tier sub-grantees 
are collecting and reporting program data.
    (e) Required evaluation and reporting. An agreement to be evaluated 
on the

[[Page 389]]

core indicators of performance and to report information on the 
additional indicators of performance is a requirement for application 
for, and is a condition of, all SCSEP grants.

[75 FR 53812, Sept. 1, 2010, as amended at 77 FR 4661, Jan. 31, 2012]

    Effective Date Note: At 77 FR 4661, Jan. 31, 2012, inSec. 641.700 
paragraph (c)(4) was added. This paragraph contains information 
collection and recordkeeping requirements and will not become effective 
until approval has been given by the Office of Management and Budget.



Sec.  641.710  How are the performance indicators defined?

    (a) The core indicators are defined as follows:
    (1) ``Hours of community service employment'' is defined as the 
total number of hours of community service provided by SCSEP 
participants divided by the number of hours of community service funded 
by the grantee's grant, after adjusting for differences in minimum wage 
among the States and areas. Paid training hours are excluded from this 
measure.
    (2) ``Entry into unsubsidized employment'' is defined by the 
formula: Of those who are not employed at the date of participation: The 
number of participants who are employed in the first quarter after the 
exit quarter divided by the number of adult participants who exit during 
the quarter.
    (3) ``Retention in unsubsidized employment for six months'' is 
defined by the formula: Of those who are employed in the first quarter 
after the exit quarter: The number of adult participants who are 
employed in both the second and third quarters after the exit quarter 
divided by the number of adult participants who exit during the quarter.
    (4) ``Earnings'' is defined by the formula: Of those participants 
who are employed in the first, second and third quarters after the exit 
quarter: Total earnings in the second quarter plus total earnings in the 
third quarter after the exit quarter divided by the number of 
participants who exit during the quarter.
    (5) ``The number of eligible individuals served'' is defined as the 
total number of participants served divided by a grantee's authorized 
number of positions, after adjusting for differences in minimum wage 
among the States and areas.
    (6) ``Most-in-need'' or the number of participating individuals 
described inSec. 518(a)(3)(B)(ii) or (b)(2) is defined by counting the 
total number of the following characteristics for all participants and 
dividing by the number of participants served. Participants are 
characterized as most-in-need if they:
    (i) Have a severe disability;
    (ii) Are frail;
    (iii) Are age 75 or older;
    (iv) Meet the eligibility requirements related to age for, but do 
not receive, benefits under title II of the Social Security Act (42 
U.S.C. 401 et seq.);
    (v) Live in an area with persistent unemployment and are individuals 
with severely limited employment prospects;
    (vi) Have limited English proficiency;
    (vii) Have low literacy skills;
    (viii) Have a disability;
    (ix) Reside in a rural area;
    (x) Are veterans;
    (xi) Have low employment prospects;
    (xii) Have failed to find employment after utilizing services 
provided under title I of the Workforce Investment Act of 1998 (29 
U.S.C. 2801 et seq.); or
    (xiii) Are homeless or at risk for homelessness.
    (b) The additional indicators are defined as follows:
    (1) ``Retention in unsubsidized employment for 1 year'' is defined 
by the formula: Of those who are employed in the first quarter after the 
exit quarter: The number of participants who are employed in the fourth 
quarter after the exit quarter divided by the number of participants who 
exit during the quarter.
    (2) ``Satisfaction of the participants, employers, and their host 
agencies with their experiences and the services provided'' is defined 
as the results of customer satisfaction surveys administered to each of 
these three customer groups. The Department will prescribe the content 
of the surveys.
    (3) ``Entry into volunteer work'' is defined by the formula: Of 
those not engaged in volunteer work at the time of entry into the SCSEP, 
the number of

[[Page 390]]

such participants who perform volunteer work in the first quarter after 
the exit quarter, divided by the number of such participants who exit 
during the quarter.

[75 FR 53812, Sept. 1, 2010, as amended at 77 FR 4661, Jan. 31, 2012]

    Effective Date Note: At 77 FR 4661, Jan. 31, 2012, inSec. 641.710 
paragraph (b)(3) was added. This paragraph contains information 
collection and recordkeeping requirements and will not become effective 
until approval has been given by the Office of Management and Budget.



Sec.  641.720  How will the Department and grantees initially 
determine and then adjust expected levels of performance for the core
performance measures?

    (a) Initial agreement. Before the beginning of each Program Year, 
the Department and each grantee will undertake to agree upon expected 
levels of performance for each core indicator, except as provided in 
paragraph (b) ofSec. 641.730.
    (1) As a first step in this process, the Department proposes a 
performance level for each core indicator, taking into account any 
statutory performance requirements, the need to promote continuous 
improvement in the program overall and in each grantee, the grantee's 
past performance, and the statutory adjustment factors articulated in 
paragraph (b) of this section.
    (2) A grantee may request a revision to the Department's initial 
performance level goal determination. The request must be based on data 
that supports the revision request. The data supplied by the grantee at 
this stage may concern the statutory adjustment factors articulated in 
paragraph (b) of this section, but is not limited to those factors; it 
is permissible for a grantee to supply data on ``other appropriate 
factors as determined by the Secretary.'' (OAASec. 513(a)(2)(C)).
    (3) The Department may revise the performance level goal in response 
to the data provided. The Department then sets the expected levels of 
performance for the core indicators. At this point, agreement is reached 
by the parties and funds may be awarded. If a grantee does not agree 
with the offered expected level of performance, agreement is not reached 
and no funds may be awarded. A grantee may submit comments to the 
Department about the grantee's satisfaction with the expected levels of 
performance.
    (4) Funds may not be awarded under the grant until such agreement is 
reached.
    (5) At the conclusion of performance level negotiations with all 
grantees, the Department will make available for public review the final 
negotiated expected levels of performance for each grantee, including 
any comments submitted by the grantee about the grantee's satisfaction 
with the negotiated levels.
    (6) The minimum percentage for the expected level of performance for 
the entry into unsubsidized employment core indicator is:
    (i) 21 percent for Program Year 2007;
    (ii) 22 percent for Program Year 2008;
    (iii) 23 percent for Program Year 2009;
    (iv) 24 percent for Program Year 2010; and
    (v) 25 percent for Program Year 2011.
    (b) Adjustment during the Program Year. After the Department and 
grantees reach agreement on the core indicator levels, those levels may 
only be revised in response to a request from a grantee based on data 
supporting one or more of the following statutory adjustment factors:
    (1) High rates of unemployment or of poverty or of participation in 
the program of block grants to States for temporary assistance for needy 
families established under part A of title IV of the Social Security Act 
(42 U.S.C. 601 et seq.), in the areas served by a grantee, relative to 
other areas of the State involved or Nation.
    (2) Significant downturns in the economy of the areas served by the 
grantee or in the national economy.
    (3) Significant numbers or proportions of participants with one or 
more barriers to employment, including individuals described inSec. 
518(a)(3)(B)(ii) or (b)(2) of the 2006 OAA (most-in-need), served by a 
grantee relative to such numbers or proportions for grantees serving 
other areas of the State or Nation.
    (4) Changes in Federal, State, or local minimum wage requirements.

[[Page 391]]

    (5) Limited economies of scale for the provision of community 
service employment and other authorized activities in the areas served 
by the grantee.



Sec.  641.730  How will the Department assist grantees in the 
transition to the new core performance indicators?

    (a) General transition provision. As soon as practicable after July 
1, 2007, the Department will determine if a SCSEP grantee has, for 
Program Year 2006, met the expected levels of performance for the 
Program Year 2007. If the Department determines that the grantee failed 
to meet Program Year 2007 goals in Program Year 2006, the Department 
will provide technical assistance to help the grantee meet those 
expected levels of performance in Program Year 2007.
    (b) Exception for most-in-need for Program Year 2007. Because the 
2006 OAA Amendments expanded the list of most-in-need characteristics, 
neither the Department nor the grantees have sufficient data to set a 
goal for measuring performance. Accordingly, Program Year 2007 will be 
treated as a baseline year for the most-in-need indicator so that the 
grantees and the Department may collect sufficient data to set a 
meaningful goal for this measure for Program Year 2008.



Sec.  641.740  How will the Department determine whether a grantee 
fails, meets, or exceeds the expected levels of performance for the
core indicators and whatwill be the consequences of failing to meet 
expected levels of performance?

    (a) Aggregate calculation of performance. Not later than 120 days 
after the end of each Program Year, the Department will determine if a 
national grantee has met the expected levels of performance (including 
any adjustments to such levels) by aggregating the grantee's core 
indicators. The aggregate is calculated by combining the percentage of 
goal achieved on each of the individual core indicators to obtain an 
average score. A grantee will fail to meet its performance measures when 
it is does not meet 80 percent of the agreed-upon level of performance 
for the aggregate of all the core indicators. Performance in the range 
of 80 to 100 percent constitutes meeting the level for the core 
performance measures. Performance in excess of 100 percent constitutes 
exceeding the level for the core performance measures.
    (b) Consequences--
    (1) National grantees. (i) If the Department determines that a 
national grantee fails to meet the expected levels of performance in a 
Program Year, the Department, after each year of such failure, will 
provide technical assistance and will require such grantee to submit a 
corrective action plan not later than 160 days after the end of the 
Program Year.
    (ii) The corrective action plan must detail the steps the grantee 
will take to meet the expected levels of performance in the next Program 
Year.
    (iii) Any national grantee that has failed to meet the expected 
levels of performance for 4 consecutive years (beginning with Program 
Year 2007) will not be allowed to compete in the subsequent grant 
competition, but may compete in the next grant competition after that 
subsequent competition.
    (2) State grantees. (i) If the Department determines that a State 
fails to meet the expected levels of performance, the Department, after 
each year of such failure, will provide technical assistance and will 
require the State to submit a corrective action plan not later than 160 
days after the end of the Program Year.
    (ii) The corrective action plan must detail the steps the State will 
take to meet the expected levels of performance in the next Program 
Year.
    (iii) If the Department determines that the State fails to meet the 
expected levels of performance for 3 consecutive Program Years 
(beginning with Program Year 2007), the Department will require the 
State to conduct a competition to award the funds allotted to the State 
underSec. 506(e) of the OAA for the first full Program Year following 
the Department's determination. The new grantee will be responsible for 
administering the SCSEP in the State and will be subject to the same 
requirements and responsibilities as had been the State grantee.
    (c) Evaluation. The Department will annually evaluate, publish and 
make available for public review, information on the actual performance 
of each

[[Page 392]]

grantee with respect to the levels achieved for each of the core 
indicators of performance, compared to the expected levels of 
performance, and the actual performance of each grantee with respect to 
the levels achieved for each of the additional indicators of 
performance. The results of the Department's annual evaluation will be 
reported to Congress.



Sec.  641.750  Will there be performance-related incentives?

    The Department is authorized by Sec.Sec. 502(e)(2)(B)(iv) and 
517(c)(1) of the 2006 OAA to use recaptured SCSEP funds to provide 
incentive awards. The Department will exercise this authority at its 
discretion.



                  Subpart H_Administrative Requirements



Sec.  641.800  What uniform administrative requirements apply to the
use of SCSEP funds?

    (a) SCSEP recipients and sub-recipients must follow the uniform 
administrative requirements and allowable cost requirements that apply 
to their type of organization. (OAASec. 503(f)(2)).
    (b) Governments, State, local, and Indian tribal organizations that 
receive SCSEP funds under grants or cooperative agreements must follow 
the common rule implementing OMB Circular A-102, ``Grants and 
Cooperative Agreements with State and Local Governments'' (10/07/1994) 
(further amended 08/29/1997), codified at 29 CFR part 97.
    (c) Nonprofit and commercial organizations, institutions of higher 
education, hospitals, other nonprofit organizations, and commercial 
organizations that receive SCSEP funds under grants or cooperative 
agreements must follow the common rule implementing OMB Circular A-110, 
codified at 29 CFR part 95.



Sec.  641.803  What is program income?

    Program income, as described in 29 CFR 97.25 (State and local 
governments) and 29 CFR 95.2(bb) (non-profit and commercial 
organizations), is income earned by the recipient or sub-recipient 
during the grant period that is directly generated by an allowable 
activity supported by grant funds or earned as a result of the award of 
grant funds. Program income includes income earned from license fees and 
royalties for copyrighted material, patents, patent applications, 
trademarks, and inventions produced under an award. (See 29 CFR 95.24(e) 
(non-profit and commercial organizations) and 29 CFR 97.25(e) (State and 
local governments)). Costs of generating SCSEP program income may be 
deducted from gross income received by SCSEP recipients and sub-
recipients to determine SCSEP program income earned or generated 
provided these costs have not been charged to the SCSEP.



Sec.  641.806  How must SCSEP program income be used?

    (a) SCSEP recipients that earn or generate program income during the 
grant period must add the program income to the Federal and non-Federal 
funds committed to the SCSEP and must use it to further the purposes of 
the program and in accordance with the terms and conditions of the grant 
award. Program income may only be spent during the grant period in which 
it was earned (except as provided for in paragraph (b)), as provided in 
29 CFR 95.24(a) (non-profit and commercial organizations) or 29 CFR 
97.25(g) (2) (State and local governments), as applicable.
    (b)(1) Except as provided for in paragraph (b)(2), recipients that 
continue to receive a SCSEP grant from the Department must spend program 
income earned from SCSEP-funded activities in the Program Year in which 
the earned income was received.
    (2) Any program income remaining at the end of the Program Year in 
which it was earned will remain available for expenditure in the 
subsequent Program Year only. Any program income remaining after the 
second Program Year must be remitted to the Department.
    (c) Recipients that do not continue to receive a SCSEP grant from 
the Department must remit unexpended program income earned during the 
grant period from SCSEP funded activities to the Department at the end 
of the grant period. These recipients have no obligation to the 
Department for program income earned after the end of the grant period.

[[Page 393]]



Sec.  641.809  What non-Federal share (matching) requirements apply to
the use of SCSEP funds?

    (a) The Department will pay no more than 90 percent of the total 
cost of activities carried out under a SCSEP grant. (OAA sec. 
502(c)(1)).
    (b) All SCSEP recipients, including Federal agencies if there is no 
statutory exemption, must provide or ensure that at least 10 percent of 
the total cost of activities carried out under a SCSEP grant (non-
Federal share of costs) consists of allowable costs paid for with non-
Federal funds, except as provided in paragraphs (e) and (f) of this 
section.
    (c) Recipients must determine the non-Federal share of costs in 
accordance with 29 CFR 97.24 for governmental units, or 29 CFR 95.23 for 
nonprofit and commercial organizations.
    (d) The non-Federal share of costs may be provided in cash, or in-
kind, or a combination of the two. (OAASec. 502(c)(2)).
    (e) A recipient may not require a sub-recipient or host agency to 
provide non-Federal resources for the use of the SCSEP project as a 
condition of entering into a sub-recipient or host agency relationship. 
This does not preclude a sub-recipient or host agency from voluntarily 
contributing non-Federal resources for the use of the SCSEP project.
    (f) The Department may pay all of the costs of activities in an 
emergency or disaster project or a project in an economically distressed 
area. (OAASec. 502(c)(1)(B)).



Sec.  641.812  What is the period of availability of SCSEP funds?

    (a) Except as provided inSec. 641.815, recipients must expend 
SCSEP funds during the Program Year for which they are awarded (July 1-
June 30). (OAASec. 517(b)).
    (b) SCSEP recipients must ensure that no sub-agreement provides for 
the expenditure of any SCSEP funds before the start of the grant year, 
or after the end of the grant period, except as provided inSec. 
641.815.



Sec.  641.815  May the period of availability be extended?

    SCSEP recipients may request in writing, and the Department may 
grant, an extension of the period during which SCSEP funds may be 
obligated or expended. SCSEP recipients requesting an extension must 
justify that an extension is necessary. (OAASec. 517(b)). The 
Department will notify recipients in writing of the approval or 
disapproval of any such requests.



Sec.  641.821  What audit requirements apply to the use of SCSEP funds?

    (a) Recipients and sub-recipients receiving Federal awards of SCSEP 
funds must follow the audit requirements in paragraphs (b) and (c) of 
this section that apply to their type of organization. As used here, 
Federal awards of SCSEP funds include Federal financial assistance and 
Federal cost-reimbursement contracts received directly from the 
Department or indirectly under awards by SCSEP recipients or higher-tier 
sub-recipients. (OAASec. 503(f)(2)).
    (b) All governmental and nonprofit organizations that are recipients 
or sub-recipients must follow the audit requirements of OMB Circular A-
133. These requirements are codified at 29 CFR parts 96 and 99 and 
referenced in 29 CFR 97.26 for governmental organizations and in 29 CFR 
95.26 for institutions of higher education, hospitals, and other 
nonprofit organizations.
    (c)(1) The Department is responsible for audits of SCSEP recipients 
that are commercial organizations.
    (2) Commercial organizations that are sub-recipients under the SCSEP 
and that expend more than the minimum level specified in OMB Circular A-
133 ($500,000, for fiscal years ending after December 31, 2003) must 
have either an organization-wide audit or a program-specific financial 
and compliance audit conducted in accordance with OMB Circular A-133.



Sec.  641.824  What lobbying requirements apply to the use of
SCSEP funds?

    SCSEP recipients and sub-recipients must comply with the 
restrictions on lobbying codified in the Department's regulations at 29 
CFR part 93. (Also refer toSec. 641.850(c), ``Lobbying costs.'')

[[Page 394]]



Sec.  641.827  What general nondiscrimination requirements apply to
the use of SCSEP funds?

    (a) SCSEP recipients, sub-recipients, and host agencies are required 
to comply with the nondiscrimination provisions codified in the 
Department's regulations at 29 CFR parts 31 and 32 and the provisions on 
the equal treatment of religious organizations at 29 CFR part 2 subpart 
D.
    (b) Recipients and sub-recipients of SCSEP funds are required to 
comply with the nondiscrimination provisions codified in the 
Department's regulations at 29 CFR part 37 if:
    (1) The recipient:
    (i) Is a One-Stop partner listed inSec. 121(b) of WIA, and
    (ii) Operates programs and activities that are part of the One-Stop 
delivery system established under WIA; or
    (2) The recipient otherwise satisfies the definition of 
``recipient'' in 29 CFR 37.4.
    (c) Recipients must ensure that participants are provided 
informational materials relating to age discrimination and/or their 
rights under the Age Discrimination in Employment Act of 1975 that are 
distributed to recipients by the Department as required bySec. 
503(b)(3) of the OAA.
    (d) Questions about or complaints alleging a violation of the 
nondiscrimination requirements cited in this section may be directed or 
mailed to the Director, Civil Rights Center, U.S. Department of Labor, 
Room N-4123, 200 Constitution Avenue, NW., Washington, DC, 20210, for 
processing. (SeeSec. 641.910(d)).
    (e) The specification of any right or protection against 
discrimination in paragraphs (a) through (d) of this section must not be 
interpreted to exclude or diminish any other right or protection against 
discrimination in connection with a SCSEP project that may be available 
to any participant, applicant for participation, or other individual 
under any applicable Federal, State, or local laws prohibiting 
discrimination, or their implementing regulations.



Sec.  641.833  What policies govern political patronage?

    (a) A recipient or sub-recipient must not select, reject, promote, 
or terminate an individual based on political services provided by the 
individual or on the individual's political affiliations or beliefs. In 
addition, as provided inSec. 641.827(b), certain recipients and sub-
recipients of SCSEP funds are required to comply with WIA 
nondiscrimination regulations in 29 CFR part 37. These regulations 
prohibit discrimination on the basis of political affiliation or belief.
    (b) A recipient or sub-recipient must not provide, or refuse to 
provide, funds to any sub-recipient, host agency, or other entity based 
on political affiliation.
    (c) SCSEP recipients must ensure that every entity that receives 
SCSEP funds through the recipient is applying the policies stated in 
paragraphs (a) and (b) of this section.



Sec.  641.836  What policies govern political activities?

    (a) No project under title V of the OAA may involve political 
activities. SCSEP recipients must ensure compliance with the 
requirements and prohibitions involving political activities described 
in paragraphs (b) and (c) of this section.
    (b) State and local employees involved in the administration of 
SCSEP activities may not engage in political activities prohibited under 
the Hatch Act (5 U.S.C. chapter 15), including:
    (1) Seeking partisan elective office;
    (2) Using official authority or influence for the purpose of 
affecting elections, nominations for office, or fund-raising for 
political purposes. (5 U.S.C. 1502).
    (c) SCSEP recipients must provide all persons associated with SCSEP 
activities with a written explanation of allowable and unallowable 
political activities under the Hatch Act. A notice explaining these 
allowable and unallowable political activities must be posted in every 
workplace in which SCSEP activities are conducted. The Department will 
provide the form and content of the notice and explanatory material by 
administrative issuance. (OAASec. 502(b)(l)(P)).
    (d) SCSEP recipients must ensure that:

[[Page 395]]

    (1) No SCSEP participants or staff persons engage in partisan or 
nonpartisan political activities during hours for which they are being 
paid with SCSEP funds.
    (2) No participants or staff persons engage in partisan political 
activities in which such participants or staff persons represent 
themselves as spokespersons for the SCSEP.
    (3) No participants are employed or out-stationed in the offices of 
a Member of Congress, a State or local legislator, or on the staff of 
any legislative committee.
    (4) No participants are employed or out-stationed in the immediate 
offices of any elected chief executive officer of a State or unit of 
general government, except that:
    (i) Units of local government may serve as host agencies for 
participants, provided that their assignments are non-political; and
    (ii) While assignments may place participants in such offices, such 
assignments actually must be concerned with program and service 
activities and not in any way involved in political functions.
    (5) No participants are assigned to perform political activities in 
the offices of other elected officials. Placement of participants in 
such offices in non-political assignments is permissible, however, 
provided that:
    (i) SCSEP recipients develop safeguards to ensure that participants 
placed in these assignments are not involved in political activities; 
and
    (ii) These safeguards are described in the grant agreement and are 
approved by the Department and are subject to review and monitoring by 
the SCSEP recipient and by the Department.



Sec.  641.839  What policies govern union organizing activities?

    Recipients must ensure that SCSEP funds are not used in any way to 
assist, promote, or deter union organizing.



Sec.  641.841  What policies govern nepotism?

    (a) SCSEP recipients must ensure that no recipient or sub-recipient 
hires, and no host agency serves as a worksite for, a person who works 
in a SCSEP community service assignment if a member of that person's 
immediate family is engaged in a decision-making capacity (whether 
compensated or not) for that project, subproject, recipient, sub-
recipient, or host agency. The Department may exempt worksites on Native 
American reservations and in rural areas from this requirement provided 
that adequate justification can be documented, such as that no other 
persons are eligible and available for participation in the program.
    (b) To the extent that an applicable State or local legal nepotism 
requirement is more restrictive than this provision, SCSEP recipients 
must ensure that the more restrictive requirement is followed.
    (c) For purposes of this section, ``immediate family'' means wife, 
husband, son, daughter, mother, father, brother, sister, son-in-law, 
daughter-in-law, mother- in-law, father-in-law, brother-in-law, sister-
in-law, aunt, uncle, niece, nephew, stepparent, stepchild, grandparent, 
or grandchild.



Sec.  641.844  What maintenance of effort requirements apply to the
use of SCSEP funds?

    (a) A community service assignment for a participant under title V 
of the OAA is permissible only when specific maintenance of effort 
requirements are met.
    (b) Each project funded under title V:
    (1) Must not reduce the number of employment opportunities or 
vacancies that would otherwise be available to individuals not 
participating in the program;
    (2) Must not displace currently employed workers (including partial 
displacement, such as a reduction in the hours of non-overtime work, 
wages, or employment benefits);
    (3) Must not impair existing contracts or result in the substitution 
of Federal funds for other funds in connection with work that would 
otherwise be performed; and
    (4) Must not employ or continue to employ any eligible individual to 
perform the same work or substantially the same work as that performed 
by any other individual who is on layoff. (OAASec. 502(b)(1)(G)).

[[Page 396]]



Sec.  641.847  What uniform allowable cost requirements apply to the
use of SCSEP funds?

    (a) General. Unless specified otherwise in this part or the grant 
agreement, recipients and sub-recipients must follow the uniform 
allowable cost requirements that apply to their type of organization. 
For example, a local government sub-recipient receiving SCSEP funds from 
a nonprofit organization must use the allowable cost requirements for 
governmental organizations in OMB Circular A-87. The Department's 
regulations at 29 CFR 95.27 (non-profit and commercial organizations) 
and 29 CFR 97.22 (State and local governments) identify the Federal 
principles for determining allowable costs that each kind of 
organization must follow. The applicable Federal principles for each 
kind of organization are described in paragraphs (b)(1) through (b)(5) 
of this section. (OAASec. 503(f)(2)).
    (b) Allowable costs/cost principles. (1) Allowable costs for State, 
local, and Indian tribal government organizations must be determined 
under OMB Circular A-87, ``Cost Principles for State, Local and Indian 
Tribal Governments.''
    (2) Allowable costs for nonprofit organizations must be determined 
under OMB Circular A-122, ``Cost Principles for Non-Profit 
Organizations.''
    (3) Allowable costs for institutions of higher education must be 
determined under OMB Circular A-21, ``Cost Principles for Educational 
Institutions.''
    (4) Allowable costs for hospitals must be determined in accordance 
with appendix E of 45 CFR part 74, ``Principles for Determining Costs 
Applicable to Research and Development Under Grants and Contracts with 
Hospitals.''
    (5) Allowable costs for commercial organizations and those nonprofit 
organizations listed in Attachment C to OMB Circular A-122 must be 
determined under the provisions of the Federal Acquisition Regulation 
(FAR), at 48 CFR part 31.



Sec.  641.850  Are there other specific allowable and unallowable cost
requirements for the SCSEP?

    (a) Yes, in addition to the generally applicable cost principles in 
Sec.  641.847(b), the cost principles in paragraphs (b) through (g) of 
this section apply to SCSEP grants.
    (b) Claims against the Government. For all types of entities, legal 
expenses for the prosecution of claims against the Federal Government, 
including appeals to an Administrative Law Judge, are unallowable.
    (c) Lobbying costs. In addition to the prohibition contained in 29 
CFR part 93, SCSEP funds must not be used to pay any salaries or 
expenses related to any activity designed to influence legislation or 
appropriations pending before the Congress of the United States or any 
State legislature. (SeeSec. 641.824).
    (d) One-Stop costs. Costs of participating as a required partner in 
the One-Stop delivery system established in accordance withSec. 134(c) 
of the WIA are allowable, provided that SCSEP services and funding are 
provided in accordance with the MOU required by the WIA and OAASec. 
502(b)(1)(O), and costs are determined in accordance with the applicable 
cost principles. The costs of services provided by the SCSEP, including 
those provided by participants/enrollees, may comprise a portion or the 
total of a SCSEP project's proportionate share of One-Stop costs.
    (e) Building repairs and acquisition costs. Except as provided in 
this paragraph and as an exception to the allowable cost principles in 
Sec.  641.847(b), no SCSEP funds may be used for the purchase, 
construction, or renovation of any building except for the labor 
involved in:
    (1) Minor remodeling of a public building necessary to make it 
suitable for use for project purposes;
    (2) Minor repair and rehabilitation of publicly used facilities for 
the general benefit of the community; and
    (3) Repair and rehabilitation by participants of housing occupied by 
persons with low incomes who are declared eligible for such services by 
authorized local agencies.
    (f) Accessibility and reasonable accommodation. Recipients and sub-
recipients may use SCSEP funds to meet their obligations underSec. 504 
of the Rehabilitation Act of 1973, as amended, and the Americans with 
Disabilities Act of

[[Page 397]]

1990, as amended, and any other applicable Federal disability 
nondiscrimination laws, to provide physical and programmatic 
accessibility and reasonable accommodation/modifications for, and 
effective communications with, individuals with disabilities. (29 U.S.C. 
794).
    (g) Participants' benefit costs. Recipients and sub-recipients may 
use SCSEP funds for participant benefit costs only under the conditions 
set forth inSec. 641.565.



Sec.  641.853  How are costs classified?

    (a) All costs must be classified as ``administrative costs'' or 
``programmatic activity costs.'' (OAASec. 502(c)(6)).
    (b) Recipients and sub-recipients must assign participants' wage and 
benefit costs and other participant (enrollee) costs such as supportive 
services to the programmatic activity cost category. (SeeSec. 
641.864). When a participant's community service assignment involves 
functions whose costs are normally classified as administrative costs, 
compensation provided to the participants must be charged as 
programmatic activity costs instead of administrative costs, since 
participant wage and benefit costs are always charged to the 
programmatic activity cost category.



Sec.  641.856  What functions and activities constitute 
administrative costs?

    (a) Administrative costs are that allocable portion of necessary and 
reasonable allowable costs of recipients and program operators that are 
associated with those specific functions identified in paragraph (b) of 
this section and that are not related to the direct provision of 
programmatic activities specified inSec. 641.864. These costs may be 
both personnel and non-personnel and both direct and indirect costs.
    (b) Administrative costs are the costs associated with:
    (1) Performing general administrative and coordination functions, 
including:
    (i) Accounting, budgeting, financial, and cash management functions;
    (ii) Procurement and purchasing functions;
    (iii) Property management functions;
    (iv) Personnel management functions;
    (v) Payroll functions;
    (vi) Coordinating the resolution of findings arising from audits, 
reviews, investigations, and incident reports;
    (vii) Audit functions;
    (viii) General legal services functions;
    (ix) Developing systems and procedures, including information 
systems, required for these administrative functions;
    (x) Preparing administrative reports; and
    (xi) Other activities necessary for general administration of 
government funds and associated programs.
    (2) Oversight and monitoring responsibilities related to 
administrative functions;
    (3) Costs of goods and services used for administrative functions of 
the program, including goods and services such as rental or purchase of 
equipment, utilities, office supplies, postage, and rental and 
maintenance of office space;
    (4) Travel costs incurred for official business in carrying out 
administrative activities or the overall management of the program;
    (5) Costs of information systems related to administrative functions 
(for example, personnel, procurement, purchasing, property management, 
accounting, and payroll systems) including the purchase, systems 
development, and operating costs of such systems and;
    (6) Costs of technical assistance, professional organization 
membership dues, and evaluating results obtained by the project involved 
against stated objectives. (OAASec. 502(c)(4)).



Sec.  641.859  What other special rules govern the classification of
costs as administrative costs or programmatic activity costs?

    (a) Recipients and sub-recipients must comply with the special rules 
for classifying costs as administrative costs or programmatic activity 
costs set forth in paragraphs (b) through (e) of this section.
    (b)(1) Costs of awards by recipients and program operators that are 
solely

[[Page 398]]

for the performance of their own administrative functions are classified 
as administrative costs.
    (2) Costs incurred by recipients and program operators for 
administrative functions listed inSec. 641.856(b) are classified as 
administrative costs.
    (3) Costs incurred by vendors and sub-recipients performing the 
administrative functions of recipients and program operators are 
classified as administrative costs. (See 29 CFR 99.210 for a discussion 
of factors differentiating sub-recipients from vendors.)
    (4) Except as provided in paragraph (b)(3) of this section, all 
costs incurred by all vendors, and only those sub-recipients below 
program operators, are classified as programmatic activity costs. (See 
29 CFR 99.210 for a discussion of factors differentiating sub-recipients 
from vendors.)
    (c) Personnel and related non-personnel costs of staff who perform 
both administrative functions specified inSec. 641.856(b) and 
programmatic services or activities must be allocated as administrative 
or programmatic activity costs to the benefiting cost objectives/
categories based on documented distributions of actual time worked or 
other equitable cost allocation methods.
    (d) The allocable share of indirect or overhead costs charged to the 
SCSEP grant are to be allocated to the administrative and programmatic 
activity cost categories in the same proportion as the costs in the 
overhead or indirect cost pool are classified as programmatic activity 
or administrative costs.
    (e) Costs of the following information systems including the 
purchase, systems development and operating (e.g., data entry) costs are 
charged to the programmatic activity cost category:
    (1) Tracking or monitoring of participant and performance 
information;
    (2) Employment statistics information, including job listing 
information, job skills information, and demand occupation information; 
and
    (3) Local area performance information.



Sec.  641.861  Must SCSEP recipients provide funding for the 
administrative costs of sub-recipients?

    (a) Recipients and sub-recipients must obtain funding for 
administrative costs to the extent practicable from non-Federal sources. 
(OAASec. 502(c)(5)).
    (b) SCSEP recipients must ensure that sufficient funding is provided 
for the administrative activities of sub-recipients that receive SCSEP 
funding through the recipient. Each SCSEP recipient must describe in its 
grant application the methodology used to ensure that sub-recipients 
receive sufficient funding for their administrative activities. (OAA 
Sec.  502(b)(1)(R)).



Sec.  641.864  What functions and activities constitute programmatic 
activity costs?

    Programmatic activity costs include, but are not limited to, the 
costs of the following functions:
    (a) Participant wages, such benefits as are required by law (such as 
workers' compensation or unemployment compensation), the costs of 
physical examinations, compensation for scheduled work hours during 
which a host agency is closed for a Federal holiday, and necessary sick 
leave that is not part of an accumulated sick leave program, except that 
no amounts provided under the grant may be used to pay the cost of 
pension benefits, annual leave, accumulated sick leave, or bonuses, as 
described inSec. 641.565;
    (b) Outreach, recruitment and selection, intake, orientation, 
assessment, and preparation and updating of IEPs;
    (c) Participant training, as described inSec. 641.540, which may 
be provided before commencing or during a community service assignment, 
and which may be provided at a host agency, in a classroom setting, or 
using other appropriate arrangements, which may include reasonable costs 
of instructors' salaries, classroom space, training supplies, materials, 
equipment, and tuition;
    (d) Subject to the restrictions inSec. 641.535(c), job placement 
assistance, including job development and job search assistance, job 
fairs, job clubs, and job referrals; and
    (e) Participant supportive services, to enable an individual to 
successfully

[[Page 399]]

participate in a SCSEP project, as described inSec. 641.545. (OAA 
Sec.  502(c)(6)(A)).



Sec.  641.867  What are the limitations on the amount of SCSEP 
administrative costs?

    (a) Except as provided in paragraph (b), no more than 13.5 percent 
of the SCSEP funds received for a Program Year may be used for 
administrative costs.
    (b) The Department may increase the amount available for 
administrative costs to not more than 15 percent, in accordance with 
Sec.  641.870. (OAASec. 502(c)(3)).



Sec.  641.870  Under what circumstances may the administrative cost
limitation be increased?

    (a) SCSEP recipients may request that the Department increase the 
amount available for administrative costs. The Department may honor the 
request if:
    (1) The Department determines that it is necessary to carry out the 
project; and
    (2) The recipient demonstrates that:
    (i) Major administrative cost increases are being incurred in 
necessary program components, such as liability insurance, payments for 
workers' compensation for staff, costs associated with achieving 
unsubsidized placement goals, and other operation requirements imposed 
by the Department;
    (ii) The number of community service assignment positions in the 
project or the number of minority eligible individuals participating in 
the project will decline if the amount available for paying the cost of 
administration is not increased; or
    (iii) The size of the project is so small that the amount of 
administrative costs incurred to carry out the project necessarily 
exceeds 13.5 percent of the grant amount. (OAASec. 502(c)(3)).
    (b) A request by a recipient or prospective recipient for an 
increase in the amount available for administrative costs may be 
submitted as part of the grant application or as a separate submission 
at any time after the grant award.



Sec.  641.873  What minimum expenditure levels are required for 
participant wages and benefits?

    (a) Except as provided inSec. 641.874 or in paragraph (c) of this 
section, not less than 75 percent of the SCSEP funds provided under a 
grant from the Department must be used to pay for wages and benefits of 
participants as described inSec. 641.864(a). (OAASec. 502(c)(6)(B)).
    (b) A SCSEP recipient is in compliance with this provision if at 
least 75 percent of the total expenditure of SCSEP funds provided to the 
recipient was for wages and benefits, even if one or more sub-recipients 
did not expend at least 75 percent of their SCSEP sub-recipient award 
for wages and benefits.
    (c) A SCSEP grantee may submit to the Department a request for 
approval to use not less than 65 percent of the grant funds to pay wages 
and benefits underSec. 641.874.



Sec.  641.874  What conditions apply to a SCSEP grantee request to
use additional funds for training and supportive service costs?

    (a) A grantee may submit to the Department a request for approval--
    (1) To use not less than 65 percent of the grant funds to pay the 
wages and benefits described inSec. 641.864(a);
    (2) To use the percentage of grant funds specified inSec. 641.867 
to pay for administrative costs as described inSec. 641.856;
    (3) To use the 10 percent of grant funds that would otherwise be 
devoted to wages and benefits underSec. 641.873 to provide participant 
training (as described inSec. 641.540(e)) and participant supportive 
services to enable participants to successfully participate in a SCSEP 
project (as described inSec. 641.545), in which case the grantee must 
provide (from the funds described in this paragraph) the wages for those 
individual participants who are receiving training from the funds 
described in this paragraph, but may not use the funds described in this 
paragraph to pay for any administrative costs; and
    (4) To use the remaining grant funds to provide participant 
training, job

[[Page 400]]

placement assistance, participant supportive services, and outreach, 
recruitment and selection, intake, orientation and assessment.
    (b) In submitting the request the grantee must include in the 
request--
    (1) A description of the activities for which the grantee will spend 
the grant funds described in paragraphs (a)(3) and (a)(4) of this 
section;
    (2) An explanation documenting how the provision of such activities 
will improve the effectiveness of the project, including an explanation 
of whether any displacement of eligible individuals or elimination of 
positions for such individuals will occur, information on the number of 
such individuals to be displaced and of such positions to be eliminated, 
and an explanation of how the activities will improve employment 
outcomes for the individuals served, based on the assessment conducted 
underSec. 641.535(a)(2); and
    (3) A proposed budget and work plan for the activities, including a 
detailed description of how the funds will be spent on the activities 
described in paragraphs (a)(3) and (a)(4) of this section.
    (c)(1) If a grantee wishes to amend an existing grant agreement to 
use additional funds for training and supportive service costs, the 
grantee must submit such a request not later than 90 days before the 
proposed date of implementation contained in the request. Not later than 
30 days before the proposed date of implementation, the Department will 
approve, approve as modified, or reject the request, on the basis of the 
information included in the request.
    (2) If a grantee submits a request to use additional funds for 
training and supportive service costs in the grant application, the 
request will be accepted and processed as a part of the grant review 
process.
    (d) Grantees may apply this provision to individual sub-recipients 
but need not provide this opportunity to all their sub-recipients.



Sec.  641.876  How will compliance with cost limitations and minimum
expenditure levels be determined?

    The Department will determine compliance by examining expenditures 
of SCSEP funds. The cost limitations and minimum expenditure level 
requirements must be met at the time all such funds have been expended 
or the period of availability of such funds has expired, whichever comes 
first.



Sec.  641.879  What are the financial and performance reporting 
requirements for recipients?

    (a) In accordance with 29 CFR 97.41 (State and local governments) or 
29 CFR 95.52 (non-profit and commercial organizations), each SCSEP 
recipient must submit a SCSEP Financial Status Report (FSR, ETA Form 
9130) in electronic format to the Department via the Internet within 45 
days after the ending of each quarter of the Program Year. Each SCSEP 
recipient must also submit a final closeout FSR to the Department via 
the Internet within 90 days after the end of the grant period. The 
Department will provide instructions for the preparation of this report. 
(OAASec. 503(f)(3)).
    (1) Financial data must be reported on an accrual basis, and 
cumulatively by funding year of appropriation. Financial data may also 
be required on specific program activities as required by the 
Department.
    (2) If the SCSEP recipient's accounting records are not normally 
kept on the accrual basis of accounting, the SCSEP recipient must 
develop accrual information through an analysis of the documentation on 
hand.
    (b) In accordance with 29 CFR 97.40 (State and local governments) or 
29 CFR 95.51 (non-profit and commercial organizations), each SCSEP 
recipient must submit updated data on participants (including data on 
demographic characteristics and data regarding the performance 
measures), host agencies, and employers in an electronic format 
specified by the Department via the Internet within 30 days after the 
end of each of the first three quarters of the Program Year, on the last 
day of the fourth quarter of the Program Year, and within 90 days after 
the last day of the Program Year. Recipients wishing to correct data 
errors or omissions for their final Program Year report must do so 
within 90 days after the end of the Program Year. The Department will 
generate SCSEP Quarterly

[[Page 401]]

Progress Reports (QPRs), as well as the final QPR, as soon as possible 
after receipt of the data. (OAASec. 503(f)(3)).
    (c) Each State agency receiving title V funds must annually submit 
an equitable distribution report of SCSEP positions by all recipients in 
the State. The Department will provide instructions for the preparation 
of this report. (OAASec. 508).
    (d) In addition to the data required to be submitted under paragraph 
(b) of this section, each SCSEP recipient may be required to collect 
data and submit reports on the performance measures. See subpart G. The 
Department will provide instructions detailing these measures and how 
recipients must prepare this report.
    (e) In addition to the data required to be submitted under paragraph 
(b) of this section, each SCSEP recipient may be required to collect 
data and submit reports about the demographic characteristics of program 
participants. The Department will provide instructions detailing these 
measures and how recipients must prepare these reports.
    (f) Federal agencies that receive and use SCSEP funds under 
interagency agreements must submit project financial and progress 
reports in accordance with this section. Federal recipients must 
maintain the necessary records that support required reports according 
to instructions provided by the Department. (OAASec. 503(f)(3)).
    (g) Recipients may be required to maintain records that contain any 
other information that the Department determines to be appropriate in 
support of any other reports that the Department may require. (OAASec. 
503(f)(3)).
    (h) Grantees submitting reports that cannot be validated or verified 
as accurately counting and reporting activities in accordance with the 
reporting instructions may be treated as failing to submit reports, 
which may result in failing one of the responsibility tests outlined in 
Sec.  641.430 and OAASec. 514(d).



Sec.  641.881  What are the SCSEP recipient's responsibilities 
relating to awards to sub-recipients?

    (a) Recipients are responsible for ensuring that all awards to sub-
recipients are conducted in a manner to provide, to the maximum extent 
practicable, full and open competition in accordance with the 
procurement procedures in 29 CFR 95.43 (non-profit and commercial 
organizations) and 29 CFR 97.36 (State and local governments).
    (b) The SCSEP recipient is responsible for all grant activities, 
including the performance of SCSEP activities by sub-recipients, and 
ensuring that sub-recipients comply with the OAA and this part. (See 
also OAASec. 514(d) andSec. 641.430 of this part on responsibility 
tests).
    (c) Recipients must follow their own procedures for allocating funds 
to other entities. The Department will not grant funds to another entity 
on the recipient's behalf.
    (d)(1) National grantees that receive grants to provide services in 
an area where a substantial population of individuals with barriers to 
employment exists must, in selecting sub-recipients, give special 
consideration to organizations (including former national grant 
recipients) with demonstrated expertise in serving such individuals. 
(OAASec. 514(e)(2)).
    (2) For purposes of this section, the term ``individuals with 
barriers to employment'' means minority individuals, Indian individuals, 
individuals with greatest economic need, and most-in-need individuals. 
(OAASec. 514(e)(1)).



Sec.  641.884  What are the grant closeout procedures?

    SCSEP recipients must follow the grant closeout procedures at 29 CFR 
97.50 (State and local governments) or 29 CFR 95.71 (non-profit and 
government organizations), as appropriate. The Department will issue 
supplementary closeout instructions to OAA title V recipients as 
necessary.



           Subpart I_Grievance Procedures and Appeals Process



Sec.  641.900  What appeal process is available to an applicant that
does not receive a grant?

    (a) An applicant for financial assistance under title V of the OAA 
that is dissatisfied because it was not awarded financial assistance in 
whole or in part may request that the Grant Officer

[[Page 402]]

provide an explanation for not awarding financial assistance to that 
applicant. The request must be filed within 10 days of the date of 
notification indicating that financial assistance would not be awarded. 
The Grant Officer must provide the protesting applicant with feedback 
concerning its proposal within 21 days of the protest. Applicants may 
appeal to the U.S. Department of Labor, Office of Administrative Law 
Judges (OALJ), within 21 days of the date of the Grant Officer's 
feedback on the proposal, or within 21 days of the Grant Officer's 
notification that financial assistance would not be awarded if the 
applicant does not request feedback on its proposal. The appeal may be 
for a part or the whole of the denied funding. This appeal will not in 
any way interfere with the Department's decisions to fund other 
organizations to provide services during the appeal period.
    (b) Failure to file an appeal within the 21 days provided in 
paragraph (a) of this section constitutes a waiver of the right to a 
hearing.
    (c) A request for a hearing under this section must state 
specifically those issues in the Grant Officer's notification upon which 
review is requested. Those provisions of the Grant Officer's 
notification not specified for review are considered resolved and not 
subject to further review.
    (d) A request for a hearing must be transmitted by certified mail, 
return receipt requested, to the Chief Administrative Law Judge, U.S. 
Department of Labor, Suite 400 North, 800 K Street, NW., Washington, DC 
20001, with one copy to the Departmental official who issued the 
determination.
    (e) The decision of the ALJ constitutes final agency action unless, 
within 21 days of the decision, a party dissatisfied with the ALJ's 
decision, in whole or in part, has filed a petition for review with the 
Administrative Review Board (ARB) (established under Secretary's Order 
No. 2-96, published at 61 FR 19978, May 3, 1996), specifically 
identifying the procedure, fact, law, or policy to which exception is 
taken. The mailing address for the ARB is 200 Constitution Ave., NW., 
Room N5404, Washington, DC 20210. The Department will deem any exception 
not specifically urged to have been waived. A copy of the petition for 
review must be sent to the grant officer at that time. If, within 30 
days of the filing of the petition for review, the ARB does not notify 
the parties that the case has been accepted for review, then the 
decision of the ALJ constitutes final agency action. Any case accepted 
by the ARB must be decided within 180 days of acceptance. If not so 
decided, the decision of the ALJ constitutes final agency action.
    (f) The Rules of Practice and Procedures for Administrative Hearings 
Before the Office of Administrative Law Judges, at 29 CFR part 18, 
govern the conduct of hearings under this section, except that:
    (1) The appeal is not considered a complaint; and
    (2) Technical rules of evidence, such as the Federal Rules of 
Evidence and subpart B of 29 CFR part 18, will not apply to any hearing 
conducted under this section. However, rules designed to assure 
production of the most credible evidence available and to subject 
testimony to test by cross-examination will be applied when the ALJ 
conducting the hearing considers them reasonably necessary. The 
certified copy of the administrative file transmitted to the ALJ by the 
official issuing the notification not to award financial assistance must 
be part of the evidentiary record of the case and need not be moved into 
evidence.
    (g) The ALJ should render a written decision no later than 90 days 
after the closing of the record.
    (h) The remedies available are provided inSec. 641.470.



Sec.  641.910  What grievance procedures must grantees make available
to applicants, employees, and participants?

    (a) Each grantee must establish, and describe in the grant 
agreement, grievance procedures for resolving complaints, other than 
those described by paragraph (d) of this section, arising between the 
grantee, employees of the grantee, sub-recipients, and applicants or 
participants.

[[Page 403]]

    (b) The Department will not review final determinations made under 
paragraph (a) of this section, except to determine whether the grantee's 
grievance procedures were followed, and according to paragraph (c) of 
this section.
    (c) Allegations of violations of Federal law, other than those 
described in paragraph (d) of this section, which are not resolved 
within 60 days under the grantee's procedures, may be filed with the 
Chief, Division of Adult Services, Employment and Training 
Administration, U.S. Department of Labor, 200 Constitution Avenue, NW., 
Washington, DC 20210. Allegations determined to be substantial and 
credible will be investigated and addressed.
    (d) Questions about, or complaints alleging a violation of, the 
nondiscrimination requirements of title VI of the Civil Rights Act of 
1964,Sec. 504 of the Rehabilitation Act of 1973,Sec. 188 of the 
Workforce Investment Act of 1998 (WIA), or their implementing 
regulations, may be directed or mailed to the Director, Civil Rights 
Center, U.S. Department of Labor, Room N-4123, 200 Constitution Avenue, 
NW., Washington, DC 20210. In the alternative, complaints alleging 
violations of WIASec. 188 may be filed initially at the grantee level. 
See 29 CFR 37.71, 37.76. In such cases, the grantee must use complaint 
processing procedures meeting the requirements of 29 CFR 37.70 through 
37.80 to resolve the complaint.



Sec.  641.920  What actions of the Department may a grantee appeal
and what procedures apply to those appeals?

    (a) Appeals from a final disallowance of costs as a result of an 
audit must be made under 29 CFR 96.63.
    (b) Appeals of suspension or termination actions taken on the 
grounds of discrimination are processed under 29 CFR 31 or 29 CFR 37, as 
appropriate.
    (c) Protests and appeals of decisions not to award a grant, in whole 
or in part, will be handled underSec. 641.900.
    (d) Upon a grantee's receipt of the Department's final determination 
relating to costs (except final disallowance of costs as a result of an 
audit, as described in paragraph (a) of this section), payment, 
suspension or termination, or the imposition of sanctions, the grantee 
may appeal the final determination to the Department's Office of 
Administrative Law Judges, as follows:
    (1) Within 21 days of receipt of the Department's final 
determination, the grantee may transmit by certified mail, return 
receipt requested, a request for a hearing to the Chief Administrative 
Law Judge, United States Department of Labor, Suite 400 North, 800 K 
Street, NW., Washington, DC 20001 with a copy to the Department official 
who signed the final determination.
    (2) The request for hearing must be accompanied by a copy of the 
final determination, and must state specifically those issues of the 
determination upon which review is requested. Those provisions of the 
determination not specified for review, or the entire determination when 
no hearing has been requested within the 21 days, are considered 
resolved and not subject to further review.
    (3) The Rules of Practice and Procedures for Administrative Hearings 
Before the Office of Administrative Law Judges, at 29 CFR part 18, 
govern the conduct of hearings under this section, except that:
    (i) The appeal is not considered as a complaint; and
    (ii) Technical rules of evidence, such as the Federal Rules of 
Evidence and subpart B of 29 CFR part 18, will not apply to any hearing 
conducted under this section. However, rules designed to assure 
production of the most credible evidence available and to subject 
testimony to test by cross-examination will be applied when the 
Administrative Law Judge conducting the hearing considers them 
reasonably necessary. The certified copy of the administrative file 
transmitted to the Administrative Law Judge by the official issuing the 
final determination must be part of the evidentiary record of the case 
and need not be moved into evidence.
    (4) The Administrative Law Judge should render a written decision no 
later than 90 days after the closing of the record. In ordering relief, 
the ALJ may exercise the full authority of the Secretary under the OAA.
    (5) The decision of the ALJ constitutes final agency action unless, 
within 21 days of the decision, a party dissatisfied with the ALJ's 
decision, in

[[Page 404]]

whole or in part, has filed a petition for review with the ARB 
(established under Secretary's Order No. 2-96), specifically identifying 
the procedure, fact, law, or policy to which exception is taken. The 
mailing address for the ARB is 200 Constitution Ave., NW., Room N5404, 
Washington, DC 20210. The Department will deem any exception not 
specifically argued to have been waived. A copy of the petition for 
review must be sent to the grant officer at that time. If, within 30 
days of the filing of the petition for review, the ARB does not notify 
the parties that the case has been accepted for review, then the 
decision of the ALJ constitutes final agency action. Any case accepted 
by the ARB must be decided within 180 days of acceptance. If not so 
decided, the decision of the ALJ constitutes final agency action.



Sec.  641.930  Is there an alternative dispute resolution process that
may be used in place of an OALJ hearing?

    (a) Parties to a complaint that has been filed according to the 
requirements ofSec. 641.920 (a), (c), and (d) may choose to waive 
their rights to an administrative hearing before the OALJ. Instead, they 
may choose to transfer the settlement of their dispute to an individual 
acceptable to all parties who will conduct an informal review of the 
stipulated facts and render a decision in accordance with applicable 
law. A written decision must be issued within 60 days after submission 
of the matter for informal review.
    (b) Unless the parties agree in writing to extend the period, the 
waiver of the right to request a hearing before the OALJ will 
automatically be revoked if a settlement has not been reached or a 
decision has not been issued within the 60 days provided in paragraph 
(a) of this section.
    (c) The decision rendered under this informal review process will be 
treated as the final agency decision.



PART 645_PROVISIONS GOVERNING WELFARE-TO-WORK GRANTS--
Table of Contents



                       Subpart A_Scope and Purpose

Sec.
645.100 What does this part cover?
645.110 What are the purposes of the Welfare-to-Work program?
645.120 What definitions apply to this part?
645.125 What are the roles of the local and State governmental partners 
          in the governance of the WtW program?
645.130 What are the effective dates for the Welfare-to-Work 1999 
          Amendments?
645.135 What is the effective date for spending Federal Welfare-to-Work 
          formula funds on newly eligible participants and newly 
          authorized services?

        Subpart B_General Program and Administrative Requirements

645.200 What does this subpart cover?
645.210 What is meant by the terms ``entity'' and ``project'' in the 
          statutory phrase ``an entity that operates a project'' with 
          Welfare-to-Work funds?
645.211 How must Welfare-to-Work funds be spent by the operating entity?
645.212 Who may be served under the general eligibility and noncustodial 
          parent eligibility (primary eligibility) provision?
645.213 Who may be served as an individual in the ``other eligibles'' 
          (30 percent) provision?
645.214 How will Welfare-to-Work participant eligibility be determined?
645.215 What must a WtW operating entity that serves noncustodial parent 
          participants do?
645.220 What activities are allowable under this part?
645.221 For what activities and services must local boards use contracts 
          and vouchers?
645.225 How do Welfare-to-Work activities relate to activities provided 
          under TANF and other related programs?
645.230 What general fiscal and administrative rules apply to the use of 
          Federal funds?
645.233 What are the time limitations on the expenditure of Welfare-to-
          Work grant funds?
645.235 What types of activities are subject to the administrative cost 
          limit on Welfare-to-Work grants?
645.240 What are the reporting requirements for Welfare-to-Work 
          programs?
645.245 Who is responsible for oversight and monitoring of Welfare-to-
          Work grants?

[[Page 405]]

645.250 What procedures apply to the resolution of findings arising from 
          audits, investigations, monitoring, and oversight reviews?
645.255 What nondiscrimination protections apply to participants in 
          Welfare-to-Work programs?
645.260 What health and safety provisions apply to participants in 
          Welfare-to-Work programs?
645.265 What safeguards are there to ensure that participants in 
          Welfare-to-Work employment activities do not displace other 
          employees?
645.270 What procedures are there to ensure that currently employed 
          workers may file grievances regarding displacement and that 
          Welfare-to-Work participants in employment activities may file 
          grievances regarding displacement, health and safety standards 
          and gender discrimination?

   Subpart C_Additional Formula Grant Administrative Requirements and 
                               Procedures

645.300 What constitutes an allowable match?
645.310 What assurances must a State provide that it will make the 
          required matching expenditures?
645.315 What actions are to be taken if a State fails to make the 
          required matching expenditures?

              Subpart D_State Formula Grant Administration

645.400 Under what conditions may the Governor request a waiver to 
          designate an alternate local administering agency?
645.410 What elements will the State use in distributing funds within 
          the State?
645.415 What planning information must a State submit in order to 
          receive a formula grant?
645.420 What factors will be used in measuring State performance?
645.425 What are the roles and responsibilities of the State(s) and 
          local boards or alternate administering agencies?
645.430 How does the Welfare-to-Work program relate to the One-Stop 
          system and Workforce Investment Act (WIA) programs?

              Subpart E_Welfare-to-Work Competitive Grants

645.500 Who are eligible applicants for competitive grant funds?
645.510 What is the required consultation with the Governor?
645.515 What are the program and administrative requirements that apply 
          to both the formula grants and competitive grants?
645.520 What are the application procedures and timeframes for 
          competitive grant funds?
645.525 What special consideration will be given to rural areas and 
          cities with large concentrations of poverty?

                 Subpart F_Administrative Appeal Process

645.800 What administrative remedies are available under this Part?

    Authority: 42 U.S.C. 603 (a)(5)(C)(viii).

    Source: 66 FR 2711, Jan. 11, 2001, unless otherwise noted.



                       Subpart A_Scope and Purpose



Sec.  645.100  What does this part cover?

    (a) Subpart A establishes regulatory provisions that apply to the 
Welfare-to-Work (WtW) programs conducted at the State and at the local 
area levels.
    (b) Subpart B provides general program requirements applicable to 
all WtW formula and competitive funds. The provisions of this subpart 
govern how WtW funds must be spent, who is eligible to participate in 
the program, allowable activities and their relationship to TANF, 
Governor's projects for long-term recipients, administrative and fiscal 
provisions, and program oversight requirements. This subpart also 
addresses worker protections and the establishment of a State grievance 
system.
    (c) Subpart C sets forth additional administrative standards and 
procedures for WtW Formula Grants, such as matching requirements and 
reallotment procedures.
    (d) Subpart D sets forth the conditions under which the Governor may 
request a waiver to designate an alternate administering agency, sets 
forth the formula elements that must be included in the within-State 
distribution formula, the submission of a State annual plan, the factors 
for measuring State performance, and the roles and responsibilities of 
the States and the local boards or alternate administering agencies.
    (e) Subpart E outlines general conditions and requirements for the 
WtW Competitive Grants.
    (f) Subpart F sets forth the administrative appeals process.

[[Page 406]]

    (g) Regulatory provisions applicable to the Indian and Native 
American Welfare-to-Work Program (INA WtW) are found at 20 CFR part 646.



Sec.  645.110  What are the purposes of the Welfare-to-Work Program?

    The purposes of the WtW program are:
    (a) To facilitate the placement of hard-to-employ welfare recipients 
and certain noncustodial parents into transitional employment 
opportunities which will lead to lasting unsubsidized employment and 
self-sufficiency;
    (b) To provide a variety of activities, grounded in TANF's ``work 
first'' philosophy, to prepare individuals for, and to place them in, 
lasting unsubsidized employment;
    (c) To provide for a variety of post-employment and job retention 
services which will assist the hard-to-employ welfare recipient and 
certain noncustodial parents to secure lasting unsubsidized employment;
    (d) To provide targeted WtW funds to high poverty areas with large 
numbers of hard-to-employ welfare recipients.



Sec.  645.120  What definitions apply to this part?

    The following definitions apply under this part:
    Act means Title IV, Part A of the Social Security Act, 42 U.S.C. 
601-619.
    Adult means an individual who is not a minor child.
    Chief Elected Official(s) (CEOs) means:
    (1) The chief elected official of the sole unit of general local 
government in the service delivery area,
    (2) The individual or individuals selected by the chief elected 
officials of all units of general local government in such area as their 
authorized representative, or
    (3) In the case of a service delivery area designated under section 
101(a)(4)(A)(iii) of JTPA, the representative of the chief elected 
official for such area (as defined in section 4(4)(C) of JTPA) or as 
defined in section 101 of the Workforce Investment Act of 1988.
    Competitive grants means those grants in which WtW funds have been 
awarded by the Department under a competitive application process to 
local governments, PICs, and private entities (such as community 
development corporations, community-based and faith-based organizations, 
disability community organizations, and community action agencies) who 
apply in conjunction with a PIC or local government.
    Department or DOL means the U.S. Department of Labor.
    Employment activities means the activities enumerated atSec. 
645.220(b).
    ETA means the Employment and Training Administration of the U.S. 
Department of Labor.
    Fiscal year (FY) means any 12-month period ending on September 30 of 
a calendar year.
    Formula grants means those grants in which WtW funds have been 
allotted to each Welfare-to-Work State, based on a formula prescribed by 
the Act, which equally considers States' shares of the national number 
of poor individuals and of adult recipients of assistance under TANF. 
The State is required to distribute not less than 85 percent of the 
allotted formula grant funds to service delivery areas in the State; and 
the State may retain not more than 15 percent for projects to help long-
term recipients of assistance enter unsubsidized employment. Unless 
otherwise specified, the term ``formula grant'' refers to the 85 percent 
and 15 percent funds.
    Governor means the Chief Executive Officer of a State.
    IV-D Agency (Child Support Enforcement) means the organizational 
unit in the State that has the responsibility for administering or 
supervising the administration of the State plan under title IV-D of the 
Act (SSA).
    Job Training Partnership Act or JTPA means Public Law (Pub. L.) 97-
300, as amended, 29 U.S.C. 1501, et seq.
    Local area means a local workforce investment area designated under 
section 116 of the Workforce investment Act of 1998, or a service 
delivery area designated under section 101 of the Job Training 
partnership Act, as appropriate.
    Local workforce investment board (local board) means a local board 
established under section 117 of the Workforce Investment Act, or a 
Private Industry Council established under section 102 of the Job 
Training Partnership Act (JTPA), which performs the functions

[[Page 407]]

authorized at section 103 of the JTPA, or an alternate administering 
agency designated under section 405(a)(5)(A)(vii)(II) of the Act and 
Sec.  645.400 of this part.
    Minor child means an individual who has not attained 18 years of 
age, or has not attained 19 years of age and is a full-time student in a 
secondary school (or in the equivalent level of vocational or technical 
training).
    MOE means maintenance of effort. Under TANF, States are required to 
maintain a certain level of spending on welfare based on ``historic'' FY 
1994 expenditure levels (Section 409(a)(7) of the Act).
    PIC means a Private Industry Council established under Section 102 
of the Job Training Partnership Act, which performs the functions 
authorized at Section 103 of the JTPA.
    Political subdivision of a State means a unit of general purpose 
local government, as provided for in State laws and/or Constitution, 
which has the power to levy taxes and spend funds and which also has 
general corporate and police powers.
    Private entity means any organization, public or private, which is 
not a local board, PIC or alternate administering agency or a political 
subdivision of a State.
    PRWORA means the Personal Responsibility and Work Opportunity 
Reconciliation Act of 1996, Public Law (Pub. L.) 104-193, which 
established the TANF program.
    SDA means a service delivery area designated under section 101 of 
the Job Training Partnership Act or a local area designated under 
section 116 of the Workforce Investment Act of 1998, as appropriate.
    Secretary means the Secretary of Labor.
    Separate State program means a program operated outside of TANF in 
which the expenditures of State funds may count for TANF MOE purposes.
    State means the 50 States of the United States, the District of 
Columbia, the Commonwealth of Puerto Rico, the US Virgin Islands, Guam, 
and American Samoa, unless otherwise specified.
    State TANF Program means those funds expended under the State Family 
Assistance Grant (SFAG), the basic block grant allocated to the States 
under Section 403(a)(1) of the Act.
    TANF means Temporary Assistance for Needy Families Program 
established under PRWORA.
    TANF MOE means the expenditure of State funds that must be made in 
order to meet the Temporary Assistance for Needy Families Maintenance of 
Effort requirement.
    Unemployed means the individual is without a job and wants and is 
available for work.
    WIA means the Workforce Investment Act of 1998 (Pub. L. 105-220)(29 
U.S.C. 2801 et seq.).
    WtW means Welfare-to-Work.
    WtW State means those States that the Secretary of Labor determines 
have met the five conditions established at Section 403(a)(5)(A)(ii) of 
the Act. Only States that are determined to be WtW States can receive 
WtW grant funds.
    WtW statute means those provisions of the Balanced Budget Act of 
1997 containing certain amendments to PRWORA and establishing the new 
Welfare-to-Work program, amending Title IV of the Social Security Act, 
(codified at 42 U.S.C. 601-619).



Sec.  645.125  What are the roles of the local and State governmental
partners in the governance of the WtW program?

    (a) Local boards or alternate administering agencies, in 
coordination with CEO's should establish policies, interpretations, 
guidelines and definitions to implement provisions of the WtW statute to 
the extent that such policies, interpretations, guidelines and 
definitions are not inconsistent with the WtW statute or regulations or 
with State policies.
    (b) States should establish policies, interpretations, guidelines 
and definitions to implement provisions of the WtW statute to the extent 
that such policies, interpretations, guidelines and definitions are not 
inconsistent with the WtW statute or regulations.
    (c) The Secretary, in consultation with other Federal Agencies, as 
appropriate, may publish guidance on interpretations of statutory and 
regulatory

[[Page 408]]

provisions. State and local policies, interpretations, guidelines and 
definitions that are consistent with interpretations contained in such 
guidance will be considered to be consistent with the WtW statute for 
purposes of this section.



Sec.  645.130  What are the effective dates for the Welfare-to-Work
1999 Amendments?

    The legislative changes made by the 1999 amendments:
    (a) Are effective on November 29, 1999, except as provided in 
paragraphs (b) and (c) of this section;
    (b) Provisions relating to the eligibility of participants for WtW 
competitive grants are effective on January 1, 2000;
    (c)(1) Provisions relating to the eligibility of participants for 
WtW formula grants are effective on July 1, 2000, except that 
expenditures from allotments to the States, as discussed inSec. 
645.135 of this subpart, must not have been made before October 1, 2000, 
for individuals who would not have been eligible under the criteria in 
effect before the changes made by the 1999 Amendments;
    (2) Provisions authorizing pre-placement vocational educational 
training and job training for WtW formula grants, atSec. 645.220(b) of 
this part, are effective on July 1, 2000, except that expenditures from 
allotments to the States, as discussed inSec. 645.135 of this subpart, 
must not have been made before October 1, 2000.



Sec.  645.135  What is the effective date for spending Federal
Welfare-to-Work formula funds on newly eligible participants and
newly authorized services?

    States and local areas may expend matching funds beginning July 1, 
2000. States and local areas may incur unpaid obligations within the 
normal course of business, beginning July 1, 2000, provided that the 
timing of those transactions ensures that drawdown of federal Welfare-
to-Work formula funds to liquidate the obligations did not occur until 
October 1, 2000.



        Subpart B_General Program and Administrative Requirements



Sec.  645.200  What does this subpart cover?

    This subpart provides general program and administrative 
requirements for WtW formula funds, including Governors' funds for long-
term recipients of assistance, and for competitive grant funding 
(section 403(a)(5)).



Sec.  645.210  What is meant by the terms ``entity'' and ``project''
in the statutory phrase ``an entity that operates a project'' 
with Welfare-to-Work funds?

    The terms ``entity'' and ``project'', in the statutory phrase ``an 
entity that operates a project'', means:
    (a) For WtW substate formula funds:
    (1) ``Entity'' means the PIC, local board (or the alternate 
administering agency designated by the Governor and approved by the 
Secretary pursuant toSec. 645.400 of this part) which administers the 
WtW substate formula funds in a local area(s). This entity is referred 
to in Sec.Sec. 645.211 through 645.225 of this part as the ``operating 
entity.''
    (2) ``Project'' means all activities, administrative and 
programmatic, supported by the total amount of the WtW substate formula 
funds allotted to the entity described in section (a)(1) of this 
paragraph.
    (b) For WtW Governors' funds for long-term recipients of assistance:
    (1) ``Entity'' means the agency, group, or organization to which the 
Governor has distributed any of the funds for long-term recipients of 
assistance, as described inSec. 645.410 (b) and (c) of this part. This 
entity is referred to in Sec.Sec. 645.211 through 645.225 of this part 
as the ``operating entity.''
    (2) ``Project'' means all activities, administrative and 
programmatic, supported by the total amount of one discrete award of WtW 
Governors' funds for long-term recipients of assistance awarded to the 
entity described in section (b)(1) of this paragraph.
    (c) For competitive WtW funds:
    (1) ``Entity'' means an eligible applicant, as described inSec. 
645.500 of this part, which is awarded a competitive WtW grant. This 
entity is referred to in

[[Page 409]]

Sec.Sec. 645.211 through 645.225 of this part as the ``operating 
entity.''
    (2) ``Project'' means all of the activities, administrative and 
programmatic, supported by the total amount of one discrete WtW 
competitive grant awarded to the entity described in section (c)(1) of 
this paragraph (section 403(a)(5)(C)).



Sec.  645.211  How must Welfare-to-Work funds be spent by the 
operating entity?

    An operating entity, as described inSec. 645.210 of this subpart, 
may spend not more than 30 percent of the WtW funds allotted to or 
awarded to the operating entity to assist individuals who meet the 
``other eligibles'' eligibility requirements underSec. 645.213 of this 
subpart. The remaining funds allotted to or awarded to the operating 
entity are to be spent to benefit individuals who meet the ``general 
eligibility'' and/or ``noncustodial parents'' eligibility requirements, 
underSec. 645.212 of this subpart. (section 403(a)(5)(C) of the Act).



Sec.  645.212  Who may be served under the general eligibility and 
noncustodial parent eligibility (primary eligibility) provision?

    An individual may be served under this provision if:
    (a)(1) (S)he is currently receiving TANF assistance under a State 
TANF program, and/or its predecessor program, for at least 30 months, 
although the months do not have to be consecutive; or
    (2) (S)he will become ineligible for assistance within 12 months due 
to either Federal or State-imposed time limits on the receipt of TANF 
assistance. This criterion includes individuals (as well as children of 
noncustodial parents) exempted from the time limits due to hardship 
under section 408(a)(7)(C) of the Act or due to a waiver because of 
domestic violence under section 402(a)(7) of the Act, who would become 
ineligible for assistance within 12 months without the exemption or 
waiver;
    (b) (S)he is no longer receiving TANF assistance because (s)he has 
reached either the Federal five-year limit or a State-imposed time limit 
on receipt of TANF assistance (section 403(a)(5)(C) of the Act); or
    (c) (S)he is a noncustodial parent of a minor child if:
    (1) The noncustodial parent is:
    (i) ``Unemployed,'' as defined inSec. 645.120 of this part,
    (ii) ``Underemployed,'' as defined by the State in consultation with 
local boards and WtW competitive grantees, or
    (iii) ``Having difficulty paying child support obligations,'' as 
defined by the State in consultation with local boards and WtW 
competitive grantees and the State Child Support Enforcement (IV-D) 
Agency, and
    (2) At least one of the following applies:
    (i) The minor child, or the custodial parent of the minor child, 
meets the long-term recipient of TANF requirements of paragraph (a) of 
this section;
    (ii) The minor child is receiving or is eligible for TANF benefits 
and services;
    (iii) The minor child received TANF benefits and services during the 
preceding year; or
    (iv) The minor child is receiving or eligible for assistance under 
the Food Stamp program, the Supplemental Security Income program, 
Medicaid, or the Children's Health Insurance Program; and
    (3) The noncustodial parent is in compliance with the terms of a 
written or oral personal responsibility contract meeting the 
requirements ofSec. 645.215 of this subpart.
    (d) For purposes of determining whether an individual is receiving 
TANF assistance in paragraphs (a)(1) of this section andSec. 
645.213(a), TANF assistance means any TANF benefits and services for the 
financially needy according to the appropriate income and resource 
criteria (if applicable) specified in the State TANF plan.



Sec.  645.213  Who may be served as an individual in the
``other eligibles'' (30 percent) provision?

    Any individual may be served under this provision if (s)he:
    (a) Is currently receiving TANF assistance (as described inSec. 
645.212(d)) and either:
    (1) Has characteristics associated with, or predictive of, long-term 
welfare dependence, such as having

[[Page 410]]

dropped out of school, teenage pregnancy, or having a poor work history. 
States, in consultation with the operating entity, may designate 
additional characteristics associated with, or predictive, of long term-
welfare dependence; or
    (2) Has significant barriers to self-sufficiency, under criteria 
established by the local board or alternate administering agency.
    (b) Was in foster care under the responsibility of the State before 
s(he) attained 18 years of age and is at least 18 but not 25 years of 
age or older at the time of application for WtW. Eligible individuals 
include those who were recipients of foster care maintenance payments as 
defined in section 475(4) under part E of the Social Security Act, or
    (c)(1) Is a custodial parent with income below 100 percent of the 
poverty line, determined in accordance with the most recent HHS Poverty 
Guidelines established under section 673(2) of the Omnibus Budget 
Reconciliation Act of 1981 (Pub. L. 97-35), including any revisions 
required by such section, applicable to a family of the size involved.
    (2) For purposes of paragraph (c)(1) of this section, income is 
defined as total family income for the last six months, exclusive of 
unemployment compensation, child support payments, and old-age and 
survivors benefits received under section 202 of the Social Security Act 
(42 U.S.C. 402).
    (3) A custodial parent with a disability whose own income meets the 
requirements of a program described in paragraph (c)(1) or (c)(3)(i) but 
who is a member of a family whose income does not meet such requirements 
is considered to have met the requirements of paragraph (c)(1) of this 
section.



Sec.  645.214  How will Welfare-to-Work participant eligibility 
be determined?

    (a) The operating entity, as described inSec. 645.210(a)(1), 
(b)(1), and (c)(1) of this subpart, is accountable for ensuring that WtW 
funds are spent only on individuals eligible for WtW projects.
    (b) The operating entity must ensure that there are mechanisms in 
place to determine WtW eligibility for individuals who are receiving 
TANF assistance. These mechanisms:
    (1) Must include arrangements with the TANF agency to ensure that a 
WtW eligibility determination is based on information, current at the 
time of the WtW eligibility determination, about whether an individual 
is receiving TANF assistance, the length of receipt of TANF assistance, 
and when an individual may become ineligible for assistance, pursuant to 
Sec.Sec. 645.212 and 645.213 of this part (section 
403(a)(5)(I)(A)(ii)(dd)).
    (2) May include a determination of WtW eligibility for 
characteristics of long-term welfare dependence and for significant 
barriers to self-sufficiency underSec. 645.213(a) of this subpart, 
based on information collected by the operating entity and/or the TANF 
agency up to six months prior to the WtW eligibility determination.
    (c) The operating entity must ensure that there are mechanisms in 
place to determine WtW eligibility for individuals who have reached the 
time limit on receipt of TANF, underSec. 645.212(b) of this subpart; 
individuals who are not receiving TANF assistance (i.e., noncustodial 
parents underSec. 645.212(c) of this subpart; individuals who are 
former foster care recipients underSec. 645.213(b) of this subpart, 
and low-income custodial parents underSec. 645.213(c) of this 
subpart). The mechanisms for establishing noncustodial parent 
eligibility must include a process for applying the preference required 
underSec. 645.215(a) of this subpart, and may include an objective 
standard to be used as a presumptive determination for establishing the 
eligibility of the minor child for the programs specified inSec. 
645.212(c)(2)(iv) of this subpart.



Sec.  645.215  What must a WtW operating entity that serves
noncustodial parent participants do?

    (a) In programs that serve noncustodial parents, the operating 
entity must give preference to those noncustodial parents who qualify 
underSec. 645.212(c)(2)(i) of this subpart over other noncustodial 
parents. The preference for admission into the program applies only to 
noncustodial parents and not to any other group eligible

[[Page 411]]

under the ``general eligibility'' provisions ofSec. 645.212(a) or (b) 
or the ``other eligibles'' provisions ofSec. 645.213. The preference 
does not require that the category of noncustodial parents eligible 
underSec. 645.212(c)(2)(i) must be exhausted before any other category 
of eligible noncustodial parents may be served. The operating entity may 
establish a process that gives preference to noncustodial parents 
eligible underSec. 645.212(c)(2)(i) and that also provides WtW 
services to noncustodial parents eligible under the other provisions of 
Sec.  645.212(c)(2).
    (b) In order to protect custodial parents and children who may be at 
risk of domestic violence, the operating entity must consult with 
domestic violence prevention and intervention organizations in the 
development of its WtW project serving noncustodial parents; and must 
not require the cooperation of the custodial parent as a condition of 
participation in the WtW program for either parent; and
    (c) The operating entity must ensure that personal responsibility 
contracts:
    (1) Take into account the employment and child support status of the 
noncustodial parent;
    (2) Include all of the following parties:
    (i) The noncustodial parent,
    (ii) The operating entity, and
    (iii) The agency responsible for administering the State Child 
Support Enforcement program as described under Title IV-D of the Act, 
unless the operating entity demonstrates to the Secretary of Labor with 
written documentation that it is not able to coordinate with the State 
IV-D agency;
    (3) Include the following elements:
    (i) A commitment by the noncustodial parent to cooperate:
    (A) In the establishment of paternity (if the participant is male) 
of the minor child at the earliest opportunity, through voluntary 
acknowledgment or other procedures, and
    (B) In the establishment of a child support order;
    (ii) A commitment by the noncustodial parent to cooperate in the 
payment of child support for the minor child. This commitment may 
include a modification of an existing support order to take into 
account:
    (A) The ability of the noncustodial parent to pay such support; and
    (B) The participation of the noncustodial parent in the WtW program, 
and
    (iii) A commitment by the noncustodial parent to participate in 
employment or related activities that will enable the noncustodial 
parent to make regular child support payments. For noncustodial parents 
who have not reached 20 years of age, such activities may include:
    (A) Completion of high school,
    (B) Earning a general equivalency degree, or
    (C) Participating in other education directly related to employment;
    (iv) A description of the services to be provided to the 
noncustodial parent under the WtW program;
    (4) Contain a commitment by the noncustodial parent to participate 
in the services that are described in the personal responsibility 
contract under paragraph (c)(3)(iv) of this section; and
    (5) Be entered into no later than thirty (30) days after the 
individual is enrolled in and is receiving services through a WtW 
project funded under this part, unless the operating entity has 
determined that good cause exists to extend this period. This extension 
may not extend to a date more than ninety (90) days after the individual 
is enrolled in and receiving services through a WtW project funded under 
this part.



Sec.  645.220  What activities are allowable under this part?

    Entities operating WtW projects may use WtW funds for the following:
    (a) Job readiness activities, subject to the requirements ofSec. 
645.221 of this subpart.
    (b) Vocational educational training or job training. A participant 
is limited to six calendar months of such training if (s)he is not also 
employed or participating in an employment activity, as described in 
paragraph (c) of this section.
    (c) Employment activities which consist of any of the following:
    (1) Community service programs;
    (2) Work experience programs;

[[Page 412]]

    (3) Job creation through public or private sector employment wage 
subsidies; and
    (4) On-the-job training.
    (d) Job placement services subject to the requirements ofSec. 
645.221 of this subpart.
    (e) Post-employment services which are provided after an individual 
is placed in one of the employment activities listed in paragraph (c) of 
this section, or in any other subsidized or unsubsidized job, subject to 
the requirements ofSec. 645.221 of this subpart. Post-employment 
services include such services as:
    (1) Basic educational skills training;
    (2) Occupational skills training;
    (3) English as a second language training; and
    (4) Mentoring.
    (f) Job retention services and support services that are provided 
after an individual is placed in a job readiness activity, as specified 
in paragraph (a) of this section; in vocational education or job 
training, as specified in paragraph (b) of this section; in one of the 
employment activities, as specified in paragraph (c) of this section, or 
in any other subsidized or unsubsidized job. WtW participants who are 
enrolled in Workforce Investment Act (WIA) or JTPA activities, such as 
occupational skills training, may also receive job retention and support 
services funded with WtW monies while they are participating in WIA 
activities. Job retention and support services can be provided with WtW 
funds only if they are not otherwise available to the participant. Job 
retention and support services include such services as:
    (1) Transportation assistance;
    (2) Substance abuse treatment (except that WtW funds may not be used 
to provide medical treatment);
    (3) Child care assistance;
    (4) Emergency or short term housing assistance; and
    (5) Other supportive services.
    (g) Individual development accounts which are established in 
accordance with the Act.
    (h) Outreach, recruitment, intake, assessment, eligibility 
determination, development of an individualized service strategy, and 
case management may be incorporated in the design of any of the 
allowable activities listed in paragraphs (a) through (g) of this 
section (section 403(a)(5)(C) of the Act).



Sec.  645.221  For what activities and services must local boards use 
contracts or vouchers?

    (a) Local boards and PIC's must provide the following activities and 
services through vouchers or contracts with public or private providers: 
the job readiness activities described inSec. 645.220(a) of this 
subpart, the job placement services described inSec. 645.220(d) of 
this subpart, and the post-employment services described inSec. 
645.220(e) of this subpart. Job placement services provided with 
contracts or vouchers are subject to the payment requirements atSec. 
645.230(a)(3) of this subpart. If an operating entity is not a local 
board or a PIC, it may provide such services directly.
    (b) Local boards and PIC's which are directly providing job 
readiness activities or job placement and/or post-employment services 
must conform to the requirement in paragraph (a) of this section, to 
provide such services through contract or voucher, by February 12, 2001.



Sec.  645.225  How do Welfare-to-Work activities relate to activities
provided through TANF and other related programs?

    (a) Activities provided through WtW must be coordinated effectively 
at the State and local levels with activities being provided through 
TANF (section 403(a)(5)(A)(vii)(II)).
    (b) The operating entity must ensure that there is an assessment of 
skills, prior work experience, employability, and other relevant 
information in place for each WtW participant. Where appropriate, the 
assessment performed by the TANF agency or JTPA should be used for this 
purpose.
    (c) The operating entity must ensure that there is an individualized 
strategy for transition to unsubsidized employment in place for each 
participant which takes into account participant assessments, including 
the TANF assessment and any JTPA assessment. Where appropriate, the TANF 
individual responsibility plan (IRP), a WIA individual employment plan, 
or a

[[Page 413]]

JTPA individual service strategy should be used for this purpose.
    (d) Coordination of resources should include not only those 
available through WtW and TANF grant funds, and the Child Care and 
Development Block Grant, but also those available through other related 
activities and programs such as the WIA or JTPA programs (One-Stop 
systems), the State employment service, private sector employers, labor 
organizations, business and trade associations, education agencies, 
housing agencies, community development corporations, transportation 
agencies, community-based and faith-based organizations, disability 
community organizations, community action agencies, and colleges and 
universities which provide some of the assistance needed by the targeted 
population (section 402(a)(5)(A)).



Sec.  645.230  What general fiscal and administrative rules apply to
the use of Federal funds?

    (a) Uniform fiscal and administrative requirements. (1) State, 
local, and Indian tribal government organizations are required to follow 
the common rule ``Uniform Administrative Requirements for Grants and 
Cooperative Agreements to State and Local Governments'' which is 
codified in the DOL regulations at 29 CFR part 97.
    (2) Institutions of higher education, hospitals, and other non-
profit organizations and other commercial organizations are required to 
follow OMB Circular A-110 which is codified in the DOL regulations at 29 
CFR part 95.
    (3) In addition to the requirements at 29 CFR 95.48 and 29 CFR 
97.36(i), contracts or vouchers for job placement services supported by 
funds provided for this program must include a provision to require that 
at least one-half (\1/2\) of the payment occur after an eligible 
individual placed into the workforce has been in the workforce for six 
(6) months. This provision applies only to placement in unsubsidized 
jobs (section 403(a)(5)(C)(i)).
    (4) In addition to the requirements at 29 CFR 95.42 and 29 CFR 
97.36(b)(3) which address codes of conduct and conflict of interest 
issues related to employees, it is also required that:
    (i) A local board or alternate administering agency member shall 
neither cast a vote on, nor participate in, any decision making capacity 
on the provision of services by such member (or any organization which 
that member directly represents), nor on any matter which would provide 
any direct financial benefit to that member or a member of his immediate 
family; and
    (ii) Neither membership on the local board or alternate 
administering agency nor the receipt of WtW funds to provide training 
and related services shall be construed, by itself, to violate these 
conflict of interest provisions.
    (5) The addition method, described at 29 CFR 97.25(g)(2), is 
required for the use of all program income earned under WtW grants. When 
the cost of generating program income has been charged to the program, 
the gross amount earned must be added to the WtW program. However, the 
cost of generating program income must be subtracted from the amount 
earned to establish the net amount of program income available for use 
under the grants when these costs have not been charged to the WtW 
program.
    (6) Any excess revenue over costs incurred for services provided by 
a governmental or non-profit entity must be included in program income 
earned.
    (b) Audit requirements. All recipients and subrecipients of 
Department of Labor WtW awards must comply with the audit requirements 
codified at 29 CFR part 96.
    (1) All governmental and non-profit organizations must follow the 
audit requirements of OMB Circular A-133 which is codified at 29 CFR 
part 99. This requirement is imposed at 29 CFR 97.26 for governmental 
organizations and at 29 CFR 95.26 for institutions of higher education, 
hospitals, and other non-profit organizations.
    (2) The Department is responsible for audits of commercial 
organizations which are direct recipients of WtW grants.
    (3) Commercial organizations which are WtW subrecipients and which 
expend more than the minimum level specified in OMB Circular A-133 
($300,000 as of April 15, 1999) must have either an organization-wide 
audit conducted in accordance with 29 CFR part

[[Page 414]]

99 or a program specific financial and compliance audit.
    (c) Allowable costs/cost principles. The DOL regulations at 29 CFR 
95.27 and 29 CFR 97.22 identify the Federal principles for determining 
allowable costs which each kind of recipient and subrecipient must 
follow. For those selected items of cost requiring prior approval, the 
authority to grant or deny approval is delegated to the Governor.
    (1) State, local, and Indian tribal government organizations must 
determine allowability of costs in accordance with the provisions of OMB 
Circular A-87, ``Cost Principles for State and Local Governments.''
    (2) Non-profit organizations must determine allowability of costs in 
accordance with OMB Circular A-122, ``Cost Principles for Non-Profit 
Organizations.''
    (3) Institutions of higher education must determine allowability of 
costs in accordance with OMB Circular A-21, ``Cost Principles for 
Education Institutions.''
    (4) Hospitals must determine allowability of costs in accordance 
with the provisions of Appendix E of 45 CFR Part 74, ``Principles for 
Determining Costs Applicable to Research and Development Under Grants 
and Contracts with Hospitals.''
    (5) Commercial organizations and those non-profit organizations 
listed in Attachment C to OMB Circular A-122 must determine allowability 
of costs in accordance with the provisions of the Federal Acquisition 
Regulation (FAR) at 48 CFR Part 31.
    (d) Information technology costs. In addition to the allowable cost 
provisions identified inSec. 645.235 of this subpart, the costs of 
information technology--computer hardware and software--will only be 
allowable under WtW grants when such computer technology is ``Year 2000 
compliant.'' To meet this requirement, information technology must be 
able to accurately process date/time data (including, but not limited 
to, calculating, comparing and sequencing) from, into and between the 
twentieth and twenty-first centuries, and the years 1999 and 2000. The 
information technology must also be able to make leap year calculations. 
Furthermore, ``Year 2000 compliant'' information technology when used in 
combination with other technology shall accurately process date/time 
data if the other information technology properly exchanges date/time 
data with it.
    (e) Prohibition on construction or purchase of facilities. WtW 
federal funds may not be used to pay for the construction or purchase of 
facilities or buildings.
    (f) Prohibition on business start-up costs. WtW federal funds may 
not be used to cover the costs of business start-up and/or capital 
ventures.
    (g) Government-wide debarment and suspension, and government-wide 
drug-free workplace requirements. All WtW grant recipients and 
subrecipients are required to comply with:
    (1) Government-wide requirements for debarment and suspension which 
are codified at 29 CFR part 98, subparts A through E; and
    (2) The government-wide requirements for a drug-free workplace. 
Recipients and subrecipients are required to comply with 29 CFR part 98, 
subpart F, except that the definition of ``grantee'' shall be read to 
include recipients and subrecipients.
    (h) Restrictions on lobbying. All WtW grant recipients and 
subrecipients are required to comply with the restrictions on lobbying 
which are codified in the DOL regulations at 29 CFR Part 93.
    (i) Nondiscrimination. All WtW grant recipients and subrecipients 
are required to comply with the nondiscrimination provisions codified in 
the DOL regulations at 29 CFR parts 31 and 32. In addition, 29 CFR part 
37 applies to recipients of WtW financial assistance who are also WIA 
recipients and applies to recipients of WtW financial assistance who 
operate programs that are part of the One-Stop system established under 
the Workforce Investment Act, to the extent that the WtW programs and 
activities are being conducted as part of the One-Stop delivery system. 
Furthermore, WtW programs that are part of larger State agencies that 
are recipients of WIA title I financial assistance must also comply with 
the provisions of 29 CFR part 37. For purposes of this paragraph, the 
term ``recipient'' has the same meaning as the term is defined in 29 CFR 
part 37. That part also contains

[[Page 415]]

participant rights related to nondiscrimination.
    (j) Nepotism. (1) No individual may be placed in a WtW employment 
activity if a member of that person's immediate family is engaged in an 
administrative capacity for the employing agency.
    (2) To the extent that an applicable State or local legal 
requirement regarding nepotism is more restrictive than this provision, 
such State or local requirement shall be followed.



Sec.  645.233  What are the time limitations on the expenditure of 
Welfare-to-Work grant funds?

    (a) Formula grant funds: The maximum time limit for the expenditure 
of a given fiscal year allotment is three years from the effective date 
of the Federal grant award to the State. The maximum time limit will be 
allowed and will be specified in the Department's formula grant document 
for each fiscal year of funds provided to the State. Any remaining funds 
that have not been expended at the end of the expenditure period must be 
returned to the Department in accordance with the applicable closeout 
procedures for formula grants.
    (b) Competitive grant funds: The maximum time limit for the 
expenditure of these funds is three years from the effective date of 
award, but will, in all cases, be determined by the grant period and the 
terms and conditions specified in the Federal grant award agreement 
(including any applicable grant modification documents). Any remaining 
funds that have not been expended at the end of the approved grant 
period must be returned to the Department in accordance with the 
applicable closeout procedures for competitive grants (section 
503(a)(5)(C)(vii)).



Sec.  645.235  What types of activities are subject to the 
administrative cost limit on Welfare-to-Work grants?

    (a) Administrative cost limitation (section 404(b)(1))--(1) Formula 
grants to states. Expenditures for administrative purposes under WtW 
formula grants to States are limited to fifteen percent (15%) of the 
grant award.
    (2) Competitive grants. The limitation on expenditures for 
administrative purposes under WtW competitive grants will be specified 
in the grant agreement but in no case shall the limitation be more than 
fifteen percent (15%) of the grant award.
    (3) Although administrative in nature, costs of information 
technology--computer hardware and software--needed for tracking and 
monitoring of WtW program, participant, or performance requirements, are 
excluded from the administrative cost limit calculation.
    (b) The costs of administration are that allocable portion of 
necessary and allowable costs associated with those specific functions 
identified in paragraph (c) of this section for the administration of 
the WtW program and which are not related to the direct provision of 
services to participants. These costs can be both personnel and non-
personnel and both direct and indirect.
    (c) The costs of administration are the costs associated with 
performing the following functions:
    (1) Performing overall general administrative functions and 
coordination of those functions under WtW including:
    (i) Accounting, budgeting, financial and cash management functions;
    (ii) Procurement and purchasing functions;
    (iii) Property management functions;
    (iv) Personnel management functions;
    (v) Payroll functions;
    (vi) Coordinating the resolution of findings arising from audits, 
reviews, investigations and incident reports;
    (vii) Audit functions;
    (viii) General legal services functions; and
    (ix) Developing systems and procedures, including information 
systems, required for these administrative functions;
    (2) Performing oversight and monitoring responsibilities related to 
WtW administrative functions,
    (3) Costs of goods and services required for administrative 
functions of the program, including goods and services such as rental or 
purchase of equipment, utilities, office supplies, postage, and rental 
and maintenance of office space;
    (4) Travel costs incurred for official business in carrying out 
administrative

[[Page 416]]

activities or the overall management of the WtW system; and
    (5) Costs of information systems related to administrative functions 
(for example, personnel, procurement, purchasing, property management, 
accounting and payroll systems) including the purchase, systems 
development and operating costs of such systems.
    (d)(1) Only that portion of the costs of WtW grantees that are 
associated with the performance of the administrative functions 
described in paragraph (c) of this section and awards to subrecipients 
or vendors that are solely for the performance of these administrative 
functions are classified as administrative costs. All other costs are 
considered to be for the direct provision of WtW activities and are 
classified as program costs.
    (2) Personnel and related non-personnel costs of staff who perform 
both administrative functions specified in paragraph (c) of this section 
and programmatic services or activities are to be allocated as 
administrative or program costs to the benefitting cost objectives/
categories based on documented distributions of actual time worked or 
other equitable cost allocation methods.
    (3) Specific costs charged to an overhead or indirect cost pool that 
can be identified directly as a program cost may be charged as a program 
cost. Documentation of such charges must be maintained.
    (4) Except as provided at paragraph (d)(1) of this section, all 
costs incurred for functions and activities of subrecipients and vendors 
are program costs.
    (5) Costs of the following information systems including the 
purchase, systems development and operating (e.g., data entry) costs are 
charged to the program category.
    (i) Tracking or monitoring of participant and performance 
information;
    (ii) Employment statistics information, including job listing 
information, job skills information, and demand occupation information; 
and
    (iii) Local area performance information.



Sec.  645.240  What are the reporting requirements for 
Welfare-to-Work programs?

    (a) General. State formula and other direct competitive grant 
recipients must report financial and participant data in accordance with 
revised instructions that will be issued by the Department after 
consultation with the Secretary of Health and Human Services, States, 
and organizations that represent State or local governments. Reports 
must be submitted to the Department quarterly. Existing WtW financial 
reporting instructions and formats are available on the WtW web site at 
http://wtw.doleta.gov/linkpages/tegltein.htm. The Internet reporting 
system for WtW grantees is accessible at http://
www.etareports.doleta.gov.
    (b) Subrecipient reporting. A State formula or other direct 
competitive grant recipient may impose different forms or formats, 
shorter due dates, and more frequent reporting requirements on 
subrecipients. However, the recipient is required to meet the reporting 
requirements imposed by the Department.
    (c) Financial reports. Each grant recipient must submit financial 
reports to the Department. Reported expenditures and program income must 
be on the accrual basis of accounting and cumulative by fiscal year of 
appropriation. If the recipient's accounting records are not normally 
kept on the accrual basis of accounting, the recipient must develop 
accrual information through an analysis of the documentation on hand.
    (d) Participant reports. Each grant recipient must submit 
participant reports to the Department. Participant data must be 
aggregate data, and, for most data elements, must be cumulative by 
fiscal year of appropriation.
    (e) Due dates. Financial and participant reports are due no later 
than 45 days after the end of each quarter. A final financial and 
participant report is required 90 days after the expiration of a funding 
period or the termination of grant support.

[[Page 417]]



Sec.  645.245  Who is responsible for oversight and monitoring of 
Welfare-to-Work grants?

    (a) The Secretary may monitor all recipients and subrecipients of 
all grants awarded and funds expended under WtW. Federal oversight will 
be conducted primarily at the State level for formula grants and at the 
recipient level for competitive grants.
    (b) The Governor must monitor local boards (or other approved 
administrative entities) funded under the State's formula allocated 
grants on a periodic basis for compliance with applicable laws and 
regulations. The Governor must develop and make available for review a 
State monitoring plan.



Sec.  645.250  What procedures apply to the resolution of findings 
arising from audits, investigations, monitoring and oversight reviews?

    (a) Resolution of subrecipient level findings.
    (1) The WtW grantee is responsible for the resolution of findings 
that arise from its monitoring reviews, investigations and audits 
(including OMB Circular A-133 audits) of subrecipients.
    (2) A State or competitive grantee, as appropriate, must use the 
audit resolution, debt collection and appeal procedures that it uses for 
other Federal grant programs.
    (3) If a State or competitive grantee, as appropriate, does not have 
such procedures, it must prescribe standards and procedures for the WtW 
grant program.
    (b) Resolution of State level findings.
    (1) The Secretary is responsible for the resolution of findings that 
arise from Federal audits, monitoring reviews, investigations, incident 
reports, and recipient level OMB Circular A-133 audits.
    (2) The Secretary will use the DOL audit resolution process, 
consistent with the Single Audit Act of 1996 and OMB Circular A-133.
    (3) A final determination issued by a grant officer pursuant to this 
process may be appealed to the DOL Office of Administrative Law Judges 
under the procedures atSec. 645.800.
    (c) Resolution of nondiscrimination findings. Findings arising from 
investigations or reviews conducted under nondiscrimination laws shall 
be resolved in accordance with those laws and the applicable 
implementing regulations.



Sec.  645.255  What nondiscrimination protections apply to participants
in Welfare-to-Work programs?

    (a) All participants in WtW programs under this part shall have such 
rights as are available under all applicable Federal, State and local 
laws prohibiting discrimination, and their implementing regulations, 
including:
    (1) The Age Discrimination Act of 1975 (42 U.S.C. 6101 et seq.);
    (2) Section 504 of the Rehabilitation Act of 1973 (29 U.S.C. 794);
    (3) The Americans with Disabilities Act of 1990 (42 U.S.C. 12101 et 
seq.); and
    (4) Title VI of the Civil Rights Act of 1964 (42 U.S.C. 2000d et 
seq.).
    (b) Participants in work activities, as defined in section 407(a) of 
the Social Security Act, operated with WtW funds, shall not be 
discriminated against because of gender. Participants alleging gender 
discrimination may file a complaint using the State's grievance system 
procedures as described inSec. 645.270 of this subpart (section 
403(a)(5)(J)(iii)) of the Act). Participants alleging gender 
discrimination in WtW programs conducted by One-Stop partners as part of 
the One-Stop delivery system may file a complaint using the complaint 
processing procedures developed and published by the State in accordance 
with the requirements of 29 CFR 37.70-37.80.
    (c) Complaints alleging discrimination in violation of any 
applicable Federal, State or local law, such as Title VII of the Civil 
Rights Act of 1964 (42 U.S.C. 2000e et seq.), Title IX of the Education 
Amendments of 1972 (20 U.S.C. 1681 et seq.), the Pregnancy 
Discrimination Act (42 U.S.C. 2000e (paragraph k)), or Section 188 of 
the Workforce Investment Act of 1998 (29 U.S.C. 2938), as well as those 
listed in paragraph (a) of this section, shall be processed in 
accordance with those laws and the implementing regulations.
    (d) Questions about or complaints alleging a violation of the 
nondiscrimination laws in paragraph (a) of this section may be directed 
or mailed to the Director, Civil Rights Center,

[[Page 418]]

U.S. Department of Labor, Room N-4123, 200 Constitution Avenue, NW, 
Washington, D.C. 20210 for processing.



Sec.  645.260  What health and safety provisions apply to participants
in Welfare-to-Work programs?

    (a) Participants in an employment activity operated with WtW funds, 
as defined inSec. 645.220 of this part, are subject to the same health 
and safety standards established under State and Federal law which are 
applicable to similarly employed employees, of the same employer, who 
are not participants in programs under WtW.
    (b) Participants alleging a violation of these health and safety 
standards may file a complaint pursuant to the procedures contained in 
Sec.  645.270 of this part (section 403(a)(5)(J)(ii)).



Sec.  645.265  What safeguards are there to ensure that participants 
in Welfare-to-Work employment activities do not displace other employees?

    (a) An adult participating in an employment activity operated with 
WtW funds, as described inSec. 645.220 (b) and (c) of this subpart, 
may fill an established position vacancy subject to the limitations in 
paragraph (c) of this section.
    (b) An employment activity operated with WtW funds, as described in 
Sec.  645.220(c) of this subpart, must not violate existing contracts 
for services or collective bargaining agreements. Where such an 
employment activity would violate a collective bargaining agreement, the 
appropriate labor organization and employer must provide written 
concurrence before the employment activity is undertaken.
    (c) An adult participating in an employment activity operated with 
WtW funds, as described inSec. 645.220(c) of this subpart, must not be 
employed or assigned:
    (1) When any other individual is on layoff from the same or any 
substantially equivalent job within the same organizational unit;
    (2) If the employer has terminated the employment of any regular, 
unsubsidized employee or otherwise caused an involuntary reduction in 
its workforce with the intention of filling the vacancy so created with 
the WtW participant; and,
    (3) If the employer has caused an involuntary reduction to less than 
full time in hours of any employee in the same or substantially 
equivalent job within the same organizational unit.
    (d) Regular employees and program participants alleging displacement 
may file a complaint pursuant toSec. 645.270 of this part (section 
403(a)(5)(J)(i)).



Sec.  645.270  What procedures are there to ensure that currently 
employed workers may file grievances regarding displacement and that
Welfare-to-Work participants in employment activities may file
grievances regarding displacement, health and safety standards
and gender discrimination?

    (a) The State shall establish and maintain a grievance procedure for 
resolving complaints from:
    (1) Regular employees that the placement of a participant in an 
employment activity operated with WtW funds, as described inSec. 
645.220 of this part, violates any of the prohibitions described in 
Sec.  645.265 of this part; and
    (2) Program participants in an employment activity operated with WtW 
funds, as described inSec. 645.220 of this part, that any employment 
activity violates any of the prohibitions described in Sec.Sec. 
645.255(d), 645.260, or 645.265 of this part.
    (b) Such grievance procedure should include an opportunity for 
informal resolution.
    (c) If no informal resolution can be reached within the specified 
time as established by the State as part of its grievance procedure, 
such procedure shall provide an opportunity for the dissatisfied party 
to receive a hearing upon request.
    (d) The State shall specify the time period and format for the 
hearing portion of the grievance procedure, as well as the time period 
by which the complainant will be provided the written decision by the 
State.
    (e) A decision by the State under paragraph (d) of this section may 
be appealed by any dissatisfied party within 30 days of the receipt of 
the State's written decision, according to the time period and format 
for the appeals portion of the grievance procedure as specified by the 
State.

[[Page 419]]

    (f) The State shall designate the State agency which will be 
responsible for hearing appeals. This agency shall be independent of the 
State or local agency which is administering, or supervising the 
administration of the State TANF and WtW programs.
    (g) No later than 120 days of receipt of an individual's original 
grievance, the State agency, as designated in paragraph (f) of this 
section, shall provide a written final determination of the individual's 
appeal.
    (h) The grievance procedure shall include remedies for violations of 
Sec.Sec. 645.255(d), 645.260, and 645.265 of this part which may 
continue during the grievance process and which may include:
    (1) Suspension or termination of payments from funds provided under 
this part;
    (2) Prohibition of placement of a WtW participant with an employer 
that has violated Sec.Sec. 645.255(b), 645.260, and 645.265 of this 
part;
    (3) Where applicable, reinstatement of an employee, payment of lost 
wages and benefits, and reestablishment of other relevant terms, 
conditions, and privileges of employment; and,
    (4) Where appropriate, other equitable relief (section 
403(a)(5)(J)(iv)).
    (i) Participants alleging gender discrimination by WtW programs that 
are not part of the One-Stop system may file a complaint using the 
grievance system procedures described above. Participants alleging 
gender discrimination by WtW programs that are part of the One-Stop 
system may file a complaint using the procedures developed by the State 
under the WIA nondiscrimination regulations at 29 CFR 37.70-37.80.



    Subpart C_Additional Formula Grant Administrative Standards and 
                               Procedures



Sec.  645.300  What constitutes an allowable match?

    (a) A State is entitled to receive two (2) dollars of Federal funds 
for every one (1) dollar of State match expenditures, up to the amount 
available for allotment to the State based on the State's percentage for 
WtW formula grant for the fiscal year. The State is not required to 
provide a level of match necessary to support the total amount available 
to it based on the State's percentage for WtW formula grant. However, if 
the proposed match is less than the amount required to support the full 
level of Federal funds, the grant amount will be reduced accordingly 
(section 403(a)(5)(A)(i)(I)).
    (b) States shall follow the match or cost-sharing requirements of 
the ``Common Rule'' Uniform Administrative Requirements for Grants and 
Cooperative Agreements to State and Local Governments (codified for DOL 
at 29 CFR 97.24). Paragraphs (b)(1)(i) and (ii), (b)(3), and (b)(4) and 
(c)(1) of this section are in addition to the common rule requirements. 
Also, paragraphs included in the common rule which relate to the use of 
donated buildings and other real property as match have been excluded 
from this provision.
    (1) Only costs that would be allowable if paid for with WtW grant 
funds will be accepted as match.
    (i) Because the use of Federal funds is prohibited for construction 
or purchase of facilities or buildings except where there is explicit 
statutory authority permitting it, costs incurred for the construction 
or purchase of facilities or buildings shall not be acceptable as match 
for a WtW grant.
    (ii) Because the costs of construction or purchase of facilities or 
buildings are unallowable as match, the donation of a building or 
property as a third party in-kind contribution is also unallowable as a 
match for a WtW grant.
    (2) A match or cost-sharing requirement may be satisfied by either 
or both of the following:
    (i) Allowable costs incurred by the grantee, subgrantee or a cost 
type contractor under the assistance agreement. This includes allowable 
cost borne by non-Federal grants or by others and cash donations from 
non-Federal third parties.
    (ii) The value of third party in-kind contributions applicable to 
the FY period to which the cost-sharing or matching requirement applies.
    (3) No more than seventy-five percent (75%) of the total match 
expenditures may be in the form of third party in-kind contributions.

[[Page 420]]

    (4) Match expenditures must be recorded in the books of account of 
the entity that incurred the cost or received the contribution. These 
amounts may be rolled up and reported as aggregate State level match.
    (c) Qualifications and exceptions--
    (1) The matching requirements may not be met by the use of an 
employer's share of participant wage payments (e.g., employer share of 
OJT wages).
    (2) Costs borne by other Federal grant agreements. A cost-sharing or 
matching requirement may not be met by costs borne by another Federal 
grant. This prohibition does not apply to income earned by a grantee or 
subgrantee from a contract awarded under another Federal grant.
    (3) General revenue sharing. For the purpose of this section, 
general revenue sharing funds distributed under 31 U.S.C. 6702 are not 
considered Federal grant funds.
    (4) Cost or contributions counted towards other Federal cost-sharing 
requirements. Neither costs nor the values of third party in-kind 
contributions may count towards satisfying a cost-sharing or matching 
requirement of a grant agreement if they have been or will be counted 
towards satisfying a cost-sharing or matching requirement of another 
Federal grant agreement, a Federal procurement contract, or any other 
award of Federal funds.
    (5) Costs financed by program income. Costs financed by program 
income, as defined in 29 CFR 97.25, shall not count towards satisfying a 
cost-sharing or matching requirement unless they are expressly permitted 
in the terms of the assistance agreement. (This use of general program 
income is described in 29 CFR 97.25(g)).
    (6) Services or property financed by income earned by contractors. 
Contractors under a grant may earn income from the activities carried 
out under the contract in addition to the amounts earned from the party 
awarding the contract. No costs of services or property supported by 
this income may count toward satisfying a cost-sharing or matching 
requirement unless other provisions of the grant agreement expressly 
permit this kind of income to be used to meet the requirement.
    (7) Records. Costs and third party in-kind contributions counting 
towards satisfying a cost-sharing or matching requirement must be 
verifiable from the records of grantees and subgrantee or cost-type 
contractors. These records must show how the value placed on third party 
in-kind contributions was derived. To the extent feasible, volunteer 
services will be supported by the same methods that the organization 
uses to support the allocability of regular personnel costs.
    (8) Special standards for third party in-kind contributions. (i) 
Third party in-kind contributions count towards satisfying a cost-
sharing or matching requirement only where, if the party receiving the 
contributions were to pay for them, the payments would be allowable 
costs.
    (ii) Some third party in-kind contributions are goods and services 
that, if the grantee, subgrantee, or contractor receiving the 
contribution had to pay for them, the payments would have been an 
indirect costs. Cost sharing or matching credit for such contributions 
shall be given only if the grantee, subgrantee, or contractor has 
established, along with its regular indirect cost rate, a special rate 
for allocating to individual projects or programs the value of the 
contributions.
    (iii) A third party in-kind contribution to a fixed-price contract 
may count towards satisfying a cost-sharing or matching requirement only 
if it results in:
    (A) An increase in the services or property provided under the 
contract (without additional cost to the grantee or subgrantee) or
    (B) A cost savings to the grantee or subgrantee.
    (iv) The values placed on third party in-kind contributions for 
cost-sharing or matching purposes must conform to the rules in the 
succeeding sections of this part. If a third party in-kind contribution 
is a type not treated in those sections, the value placed upon it must 
be fair and reasonable.
    (d) Valuation of donated services--(1) Volunteer services. Unpaid 
services provided to a grantee or subgrantee by individuals must be 
valued at rates consistent with those ordinarily paid for

[[Page 421]]

similar work in the grantee's or subgrantee's organization. If the 
grantee or subgrantee does not have employees performing similar work, 
the rates must be consistent with those ordinarily paid by other 
employers for similar work in the same labor market. In either case, a 
reasonable amount for fringe benefits may be included in the valuation.
    (2) Employees of other organizations. When an employer other than a 
grantee, subgrantee, or cost-type contractor furnishes free of charge 
the services of an employee in the employee's normal line of work, the 
services must be valued at the employee's regular rate of pay exclusive 
of the employee's fringe benefits and overhead costs. If the services 
are in a different line of work, paragraph (d)(1) of this section 
applies.
    (e) Valuation of third party donated supplies and loaned equipment 
or space. (1) If a third party donates supplies, the contribution must 
be valued at the market value of the supplies at the time of donation.
    (2) If a third party donates the use of equipment or space in a 
building but retains title, the contribution must be valued at:
    (i) the fair rental rate of the equipment or space for property 
donated by non-governmental entities, or
    (ii) a depreciation or use-allowance based on the property's market 
value at the time it was donated for property donated by governmental 
entities.



Sec.  645.310  What assurance must a State provide that it will make
the required matching expenditures?

    In its State plan, a State must provide a written estimate of 
planned matching expenditures and describe the process by which the 
funds will be tracked and reported to ensure that the State meets its 
projected match (section 403(a)(5)(A)(i)(I)).



Sec.  645.315  What actions are to be taken if a State fails to make
the required matching expenditures?

    (a) If State match expenditures do not satisfy the requirements of 
the FY grant award by the end of the three year fund availability 
period, the grant award amount will be reduced by the appropriate 
corresponding amount (i.e., the grant will be reduced by two (2) dollars 
for each one (1) dollar shortfall in State matching funds) when the 
grant is closed out.
    (b) Compliance with the fifteen percent (15%) administrative cost 
limit will be recalculated based on the FY formula grant award amount, 
as reduced under paragraph (a) of this section.



              Subpart D_State Formula Grants Administration



Sec.  645.400  Under what conditions may the Governor request a waiver
to designate an alternate local administering agency?

    (a)(1) The Governor may include in the State's WtW Plan a waiver 
request to select an agency other than the local board or PIC to 
administer the program for one or more local areas or SDA's in a State; 
or
    (2) When the Governor determines the local board or alternate 
administering agency has not coordinated its expenditures with the 
expenditure of funds provided to the State under TANF, pursuant to 
section 403(a)(5)(A)(vii)(II) of the Act, the Governor must request a 
waiver.
    (b) The Governor shall bear the burden of proving that the 
designated alternate administering agency, rather than the local board 
or other alternate administering agency, would improve the effectiveness 
or efficiency of the administration of WtW funds in the SDA. The 
Governor's waiver request shall include information to meet that burden. 
The Governor shall provide a copy of the waiver request and any 
supporting information submitted to the Secretary to the local board and 
CEO of the local area for which an alternative administering agency is 
requested.
    (c) The local board and CEO shall have fifteen (15) days in which to 
submit his or her written response to the Department. The local board 
and CEO shall provide a copy of such response to the Governor.
    (d) The Secretary will assess the waiver information submitted by 
the Governor, including input from the

[[Page 422]]

local board and CEO in reaching the decision whether to permit the use 
of an alternate administering agency.
    (e) The Secretary shall approve a waiver request if she determines 
that the Governor has established that the designated alternate 
administering agency, rather than the local board or other administering 
agency, will improve the effectiveness or efficiency of the 
administration of WtW funds provided for the benefit of the local area.
    (f) Where an alternate administering agency is approved by the 
Secretary, such administrative entity shall coordinate with the CEO for 
the applicable local area(s) regarding the expenditure of WtW grant 
funds in the local area(s).
    (g) The decision of the Secretary to approve or deny a waiver 
request will be issued promptly and shall constitute final agency 
action.



Sec.  645.410  What elements will the State use in distributing funds
within the State?

    (a) Of the WtW funds allotted to the State, not less than 85 percent 
of the State allotment must be distributed to the local areas or SDA's 
in the State.
    (1) The State shall prescribe a formula for determining the amount 
of funds to be distributed to each local area or SDA in the State using 
no factors other than the three factors described in paragraphs (2) and 
(3) of this paragraph;
    (2) The formula prescribed by the Governor must include as one of 
the formula factors for distributing funds the provision at section 
403(a)(5)(A)(vi)(I)(aa) of the Act. The Governor is to distribute funds 
to a local area or SDA based on the number by which the population of 
the area with an income that is less than the poverty line exceeds 7.5 
percent of the total population of the area, compared to all such 
numbers in all such areas in the State. The Governor must assign a 
weight of not less than 50 percent to this factor;
    (3) The Governor shall distribute the remaining funds, if any, to 
the local area or SDA's utilizing only one or both of the following 
factors:
    (i) the local area or SDA's share of the number of adults receiving 
assistance under TANF or the predecessor program in the local area or 
SDA for 30 months or more (whether consecutive or not), relative to the 
number of such adults residing in the State;
    (ii) the local area or SDA's share of the number of unemployed 
individuals residing in the local area or SDA, relative to the number of 
such individuals residing in the State.
    (4) If the amount to be distributed to a local area or SDA by the 
Governor's formula is less than $100,000, the funds shall be available 
to be used by the Governor to fund projects described at paragraph (b) 
of this section.
    (5) States shall use the guidance provided at section 403(a)(5)(D) 
of the Act in determining the number of individuals with an income that 
is less than the poverty line.
    (6) Local Boards (or alternate administering agency) shall 
determine, pursuant to section 403(a)(5)(A)(vii)(I) of the Act, on which 
individual(s) and on which allowable activities to expend its WtW fund 
allocation.
    (7) The State must distribute the local boards' or SDAs' allocations 
in a timely manner, but not longer than 30 days from receipt of the 
State's fund allotment.
    (b) Of the funds allocated to the State, up to 15 percent of the 
funds may be retained at the State level to fund projects that appear 
likely to help long-term recipients of assistance enter unsubsidized 
employment. Any additional funds available as a result of the process 
described at paragraph (a)(4) of this section, shall also be available 
to be used to fund projects to help long-term recipients of assistance 
enter unsubsidized jobs.
    (c) The Governors may distribute the funds retained pursuant to 
paragraph (b) of this section to a variety of workforce organizations, 
in addition to local boards or alternate administering agencies, and 
other entities such as One-Stop systems, private sector employers, labor 
organizations, business and trade associations, education agencies, 
housing agencies, community development corporations, transportation 
agencies, community-based and faith-based organizations, disability 
community organizations, community

[[Page 423]]

action agencies, and colleges and universities which provide some of the 
assistance needed by the targeted population.



Sec.  645.415  What planning information must a State submit in order
to receive a formula grant?

    (a) Each State seeking financial assistance under the formula grant 
portion of the WtW legislation must submit an annual plan meeting the 
requirements prescribed by the Secretary. This plan shall be in the form 
of an addendum to the TANF State plan and shall be submitted to the 
Secretaries of Labor and Health and Human Services.
    (b) The Secretary shall review the State plan for compliance with 
the statutory and regulatory provisions of the WtW program. The 
Secretary's decision whether to accept a State plan as in compliance 
with the Act shall constitute final agency action.
    (c) If the Governor has requested a waiver to permit the selection 
of an alternate administering agency in the State plan, the provisions 
ofSec. 645.400 of this part shall apply (section 403(a)(5)(A)(ii)).



Sec.  645.420  What factors will be used in measuring State 
performance?

    (a) The Department will use the following factors to measure State 
performance:
    (1) Job entry rate as measured by the proportion of WtW participants 
who enter either subsidized employment or unsubsidized employment,
    (2) Substantive job entry rate as measured by the proportion of WtW 
participants who are placed in or who have moved into subsidized or 
unsubsidized employment of 30 hours or more per week,
    (3) Retention as measured by the proportion of WtW participants who 
remain in unsubsidized employment six months in the second subsequent 
quarter after the quarter in which placement occurred after initial 
placement, and
    (4) Measured earnings gains of WtW participants who remain in 
unsubsidized employment six months after initial placement.
    (b) The formula for calculating the performance bonus is weighted as 
follows:
    (1) 30 percent on job entry rate,
    (2) 30 percent on substantive job entry rate,
    (3) 20 percent on retention in unsubsidized employment,
    (4) 20 percent on earnings gains in unsubsidized employment.
    The formula will reflect general economic conditions on a State-by-
State basis.
    (c) The formula shall serve as the basis for the award of FY 2000 
bonus grants based on successful performance to be made in FY 2001 
(section 403(a)(5)(E)).



Sec.  645.425  What are the roles and responsibilities of the State(s)
and local boards or alternate administering agencies?

    (a) State roles and responsibilities. A State:
    (1) Designates State WtW administering agency;
    (2) Provides overall administration of WtW funds, consistent with 
the WtW statute, WtW regulations and the State's WtW Plan;
    (3) Develops the State WtW Plan in consultation and coordination 
with appropriate entities in substate areas, such as One-Stop systems, 
private sector employers, labor organizations, business and trade 
associations, education agencies, housing agencies, community 
development corporations, transportation agencies, community-based and 
faith-based organizations, disability community organizations, community 
action agencies, and colleges and universities which provide some of the 
assistance needed by the targeted population (section 
403(a)(5)(A)(ii)(I)(cc));
    (4) Distributes funds to SDAs, consistent with the provisions 
described atSec. 645.410(a) (section 403(a)(5)(A)(ii)(I)(bb));
    (5) Conducts oversight and monitoring of WtW activities and fund 
expenditures at the State and local levels for compliance with 
applicable laws and regulations, consistent with the provisions atSec. 
645.245 and provides technical assistance as appropriate;

[[Page 424]]

    (6) Ensures coordination of local board or alternate administering 
agency fund expenditures with the State TANF expenditures and other 
programs (section 403(a)(5)(A)(ii)(I)(dd));
    (7) Determines whether to request waivers to select an alternate 
administering agency consistent with the provisions described atSec. 
645.400 of this part (sections 403(a)(5)(A)(ii)(I)(ee) and 
403(a)(5)(A)(vii)(III));
    (8) Manages and distributes State level WtW funds (15 percent), 
consistent with the provisions atSec. 645.410(b) and (c) (section 
403(a)(5)(A)(vi)(III));
    (9) Ensures that the 15 percent administration limitation and the 
match requirement are met;
    (10) Ensures that worker protections provisions are observed and 
establishes an appropriate grievance process, consistent with Sec.Sec. 
645.255 through 645.270 of this part (section 403(a)(5)(J));
    (11) Provides comments on Competitive Grant Application(s) from 
eligible entities within the State, consistent withSec. 645.510 of 
this part (section 403(a)(5)(B)(ii));
    (12) Cooperates with the Department of Health and Human Services on 
the evaluation of WtW programs (section 403(a)(5)(A)(ii)(III));
    (13) Provides technical assistance to PIC's, local boards or 
alternate administering agencies; and
    (14) Establishes internal reporting requirements to ensure Federal 
reports are accurate, complete and are submitted on a timely basis, 
consistent withSec. 645.240 of this part.
    (b) Local Boards (or alternate administering agency) roles and 
responsibilities. A local board:
    (1) Has sole authority, in coordination with CEOs, to expend formula 
funds (section 403(a)(5)(A)(vii)(I));
    (2) Has authority to determine the individuals to be served in the 
local area (section 403(a)(5)(A)(vii)(I));
    (3) Has authority to determine the services to be provided in the 
local area (section 403(a)(5)(A)(vii)(I));
    (4) Ensures funds are expended on eligible recipients and on 
allowable activities, consistent withSec. 645.410(a)(5) of this part;
    (5) Coordinates WtW fund expenditures with State TANF expenditures 
and other programs (section 403(a)(5)(A)(ii)(dd));
    (6) Ensures that there is an assessment and an individual service 
strategy in place for each WtW participant, consistent withSec. 
645.225(a) and (b) of this part;
    (7) Conducts oversight and monitoring of subrecipients, consistent 
with the provisions atSec. 645.245 of this part;
    (8) Ensures worker protection provisions and grievance process are 
observed, consistent with State guidelines (section 403(a)(5)(J)); and
    (9) Consults with and provides comments on private entity 
Competitive Grant Application(s), consistent with the provisions at 
Sec.  645.500(b)(1)(i) of this part.



Sec.  645.430  How does the Welfare-to-Work program relate to the 
One-Stop system and Workforce Investment Act (WIA) programs?

    (a) As provided in the Workforce Investment Act regulations at 20 
CFR 663.620, the local WtW formula grant program operator is a required 
partner in the One-Stop system. 20 CFR part 662 describes the roles of 
such partners in the One-Stop system and applies to the WtW formula 
grant program operators. A Memorandum of Understanding must be developed 
between the Local Workforce Investment Board and the WtW program that 
meets the requirements of 20 CFR 662.300, such as containing provisions 
relating to the services to be provided through the One-Stop system and 
methods for referring individuals between the One-Stop operator and the 
partner WtW program.
    (b) WtW participants may also be served by the WIA programs and, 
through appropriate linkages and referrals, these individuals will have 
access to a broader range of activities and services through the 
cooperation of the WtW and WIA programs in the One-Stop system. For 
example, WtW participants, who are also determined eligible for WIA, and 
who need occupational skills training, may be referred through the One-
Stop system to receive WIA training. These participants are also 
eligible to receive services available under WtW, such as transportation 
and child care while participating in the WIA activity.

[[Page 425]]

    (c) WIA participants, who are determined to be eligible for WtW, may 
also be served by the WtW programs through cooperation with the WIA 
programs in the One-Stop system. For example, WIA participants, who are 
also determined eligible for WtW, may be referred to the WtW program for 
job placement and other WtW assistance.
    (d) 29 CFR part 37 applies to recipients of WtW financial assistance 
who operate programs that are part of the One-Stop system established 
under WIA to the extent that the WtW programs and activities are being 
conducted as part of the One-Stop delivery system.



              Subpart E_Welfare-To-Work Competitive Grants



Sec.  645.500  Who are eligible applicants for competitive grants?

    (a) Eligible applicants for competitive grants are:
    (1) Local boards or alternate administering agencies
    (2) Political subdivisions of a State; and
    (3) Private entities, as defined inSec. 645.120 of this part, 
including nonprofit organizations such as community development 
corporations, community-based and faith-based organizations, disability 
community organizations, community action agencies, and public and 
private colleges and universities, and other qualified private 
organizations.
    (b) Entities other than a local board or alternate administering 
agency or a political subdivision of the State must submit an 
application for competitive grant funds in conjunction with the 
applicable local board or alternate administering agency or political 
subdivision.
    (1) The term ``in conjunction with'' shall mean that the application 
submitted by such an entity must include a signed certification by both 
the applicant and either the applicable local board or alternate 
administering agency or political subdivision that:
    (i) The applicant has consulted with the applicable local board or 
alternate administering agency or political subdivision during the 
development of the application; and
    (ii) The activities proposed in the application are consistent with, 
and will be coordinated with, WtW efforts of the local board or 
alternate administering agency or political subdivision.
    (2) If the applicant is unable to include such a certification in 
its application, the applicant will be required to certify, and provide 
information indicating that efforts were undertaken to consult with the 
local board or alternate administering agency or political subdivision 
and that the local board or alternate administering agency or political 
subdivision was provided a sufficient opportunity to cooperate in the 
development of the project plan and to review and comment on the 
application prior to its submission to the Secretary. ``Sufficient 
opportunity for local Board or alternate administering agency or 
political subdivision review and comment'' shall mean at least 30 
calendar days.
    (3) The certification described in paragraph (b)(1) of this section, 
or the evidence of efforts to consult described in paragraph (b)(2), 
must be with each local board or alternate administering agency or 
political subdivision included in the geographic area in which the 
project proposed in the application is to operate (section 
403(a)(5)(B)(ii)).



Sec.  645.510  What is the required consultation with the Governor?

    (a) All applicants for competitive grants, including local boards or 
alternate administering agencies and political subdivisions, must 
consult with the Governor by submitting their application to the 
Governor or the designated State administrative entity for the WtW 
program for review and comment prior to submission of the application to 
the Secretary. The application submitted to the Secretary must include:
    (1) Comments on the application from the State; or
    (2) Information indicating that the State was provided a sufficient 
opportunity for review and comment prior to submission to the Secretary. 
``Sufficient opportunity for State review and comment'' shall mean at 
least 15 calendar days.
    (b) For private entity applicants, the submission of the application 
for State

[[Page 426]]

review and comment must follow the 30 day period provided for local 
board or alternate administering agency/political subdivision review. 
Evidence of local board or alternate administering agency or political 
subdivision review should be included in the submission to the State 
(section 403(a)(5)(B)(ii)).



Sec.  645.515  What are the program and administrative requirements
that apply to both the formula grants and competitive grants?

    (a) All of the general program requirements and administrative 
standards set by 29 CFR Part 645 Subpart B apply (section 403(a)(5)(C) 
and section 404(b)).
    (b) In addition, competitive grants will be subject to:
    (1) Supplemental reporting requirements; and
    (2) Additional monitoring and oversight requirements based on the 
negotiated scope-of-work of individual grant awards (section 
403(a)(5)(B)(iii) and (v)).



Sec.  645.520  What are the application procedures and timeframes
for competitive grant funds?

    (a) The Secretary shall establish appropriate application 
procedures, selection criteria and an approval process to ensure that 
grant awards accomplish the purpose of the competitive grant funds and 
that available funds are used in an effective manner.
    (b) The Secretary shall publish such procedures in the Federal 
Register and establish submission timeframes in a manner that allows 
eligible applicants sufficient time to develop and submit quality 
project plans (section 403(a)(5)(B)(i) and (iii)).



Sec.  645.525  What special consideration will be given to rural
areas and cities with large concentrations of poverty?

    (a) Competitive grant awards will be targeted to geographic areas of 
significant need. In developing application procedures, special 
consideration will be given to rural areas and cities with large 
concentrations of residents living in poverty.
    (b) Grant application guidelines will clarify specific requirements 
for documenting need in the local area (section 403(a)(5)(B)(iv)).



                 Subpart F_Administrative Appeal Process



Sec.  645.800  What administrative remedies are available under
this Part?

    (a) Within 21 days of receipt of a final determination that has 
directly imposed a sanction or corrective action pursuant toSec. 
645.250(b) of this part, a recipient, subrecipient, or a vendor directly 
against which the Grant Officer has imposed a sanction or corrective 
action, may request a hearing before the Department of Labor Office of 
Administrative Law Judges, pursuant to the provisions of 29 CFR part 96 
subpart 96.6.
    (b) In accordance with 29 CFR 96.603(b)(2), the rules of practice 
and procedure published at 29 CFR part 18 shall govern the conduct of 
hearings under this section, except that a request for hearing under 
this section shall not be considered a complaint to which the filing of 
an answer by DOL or a DOL agency is required. Technical rules of 
evidence shall not apply to a hearing conducted pursuant to this part; 
however, rules or principles designed to assure production of the most 
credible evidence available and to subject testimony to cross-
examination shall apply.
    (c) The decision of the Administrative Law Judge (ALJ) shall 
constitute final agency action unless, within 20 days of the decision, a 
party dissatisfied with the decision of the ALJ has filed a petition for 
review with the Administrative Review Board (ARB) (established pursuant 
to the provisions of Secretary's Order No. 2-96, published at 61 FR 
19977 (May 3, 1996)), specifically identifying the procedure, fact, law 
or policy to which exception is taken. Any exception not specifically 
urged shall be deemed to have been waived. A copy of the petition for 
review must be sent to the opposing party at that time. Thereafter, the 
decision of the ALJ shall constitute final agency action unless the ARB, 
within 30 days of the filing of the petition for review, has notified 
the parties that the case has been accepted for review. Any case 
accepted by the ARB shall be decided

[[Page 427]]

within 120 days of such acceptance. If not so decided, the decision of 
the ALJ shall constitute final agency action.

                           PART 646 [RESERVED]



PART 650_STANDARD FOR APPEALS PROMPTNESS_UNEMPLOYMENT COMPENSATION--
Table of Contents



Sec.
650.1 Nature and purpose of the standard.
650.2 Federal law requirements.
650.3 Secretary's interpretation of Federal law requirements.
650.4 Review of State law and criteria for review of State compliance.
650.5 Annual appeals performance plan.

    Authority: Sec. 1102 of the Social Security Act, 42 U.S.C. 1302; 
Secretary's Order No. 4-75, dated April 16, 1975. Interpret and apply 
secs. 303(a)(1), 303(a)(3), and 303(b)(2) of the Social Security Act (42 
U.S.C. 503(a)(1), 503(a)(3), 503(b)(2)).

    Source: 37 FR 16173, Aug. 11, 1972, unless otherwise noted.



Sec.  650.1  Nature and purpose of the standard.

    (a) This standard is responsive to the overriding concern of the 
U.S. Supreme Court in California Department of Human Resources v. Java, 
402 U.S. 121 (1971), and that of other courts with delay in payment of 
unemployment compensation to eligible individuals, including delays 
caused specifically by the adjudication process. The standard seeks to 
assure that all administrative appeals affecting benefit rights are 
heard and decided with the greatest promptness that is administratively 
feasible.
    (b) Sections 303(a) (1) and (3) of the Social Security Act require, 
as a condition for the receipt of granted funds, that State laws include 
provisions for methods of administration reasonably calculated to insure 
full payment of unemployment compensation when due, and opportunity for 
a fair hearing for all individuals whose claims for unemployment 
compensation are denied. The Secretary has construed these provisions to 
require, as a condition for receipt of granted funds, that State laws 
include provisions for hearing and deciding appeals for all unemployment 
insurance claimants who are parties to an administrative benefit appeal 
with the greatest promptness that is administratively feasible. What is 
the greatest promptness that is administratively feasible in an 
individual case depends on the facts and circumstances of that case. For 
example, the greatest promptness that is administratively feasible will 
be longer in cases that involve interstate appeals, complex issues of 
fact or law, reasonable requests by parties for continuances or 
rescheduling of hearings or other unforeseen and uncontrollable factors 
than it will be for other cases.
    (c) In addition, the Secretary has construed section 303(b)(2) of 
the Social Security Act as requiring States to comply substantially with 
the required provisions of State law. The Secretary considers as 
substantial compliance the issuance of minimum percentages of first 
level benefit appeal decisions within the periods of time specified in 
Sec.  650.4.
    (d) Although the interpretation of Federal law requirements inSec. 
650.3 below applies to both first and second level administrative 
benefit appeals, the criteria for review of State compliance inSec. 
650.3(b) apply only to first level benefit appeals.



Sec.  650.2  Federal law requirements.

    (a) Section 303(a)(1) of the Social Security Act requires that a 
State law include provision for:

    Such methods of administration * * * as are found by the Secretary 
of Labor to be reasonably calculated to insure full payment of 
unemployment compensation when due.

    (b) Section 303(a)(3) of the Social Security Act requires that a 
State law include provision for:

    Opportunity for a fair hearing, before an impartial tribunal, for 
all individuals whose claims for unemployment compensation are denied.

    (c) Section 303(b)(2) of the Social Security Act provides that:

    Whenever the Secretary of Labor, after reasonable notice and 
opportunity for hearing to the State agency charged with the 
administration of the State law, finds that in the administration of the 
law there is--
    (1) * * *
    (2) A failure to comply substantially with any provision specified 
in subsection (a)

[[Page 428]]

[303(a)]; the Secretary of Labor shall notify such State agency that 
further payments will not be made to the State until he is satisfied 
that there is no longer any such denial or failure to comply. Until the 
Secretary of Labor is so satisfied, he shall make no further 
certification to the Secretary of the Treasury with respect to such 
State * * *



Sec.  650.3  Secretary's interpretation of Federal law requirements.

    (a) The Secretary interprets sections 303(a)(1) and 303(a)(3) above 
to require that a State law include provision for--
    (1) Hearing and decision for claimants who are parties to an appeal 
from a benefit determination to an administrative tribunal with the 
greatest promptness that is administratively feasible, and
    (2) Such methods of administration of the appeals process as will 
reasonably assure hearing and decision with the greatest promptness that 
is administratively feasible.
    (b) The Secretary interprets section 303(b)(2) above to require a 
State to comply substantially with provisions specified in paragraph (a) 
of this section.



Sec.  650.4  Review of State law and criteria for review of State 
compliance.

    (a) A State law will satisfy the requirements ofSec. 650.3(a) if 
it contains a provision requiring, or is construed to require, hearing 
and decision for claimants who are parties to an administrative appeal 
affecting benefit rights with the greatest promptness that is 
administratively feasible.
    (b) A State will be deemed to comply substantially with the State 
law requirements set forth inSec. 650.3(a) with respect to first level 
appeals, the State has issued at least 60 percent of all first level 
benefit appeal decisions within 30 days of the date of appeal, and at 
least 80 percent of all first level benefit appeal decisions within 45 
days. These computations will be derived from the State's regular 
reports required pursuant to the Unemployment Compensation Manual, part 
III, sections 4400-4450. \1\
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    \1\ The Unemployment Compensation Manual is available at each 
regional office of the Department of Labor and at the headquarters' 
office of each State unemployment compensation agency.

[37 FR 16173, Aug. 11, 1972, as amended at 41 FR 6757, Feb. 13, 1976; 71 
FR 35517, June 21, 2006]



Sec.  650.5  Annual appeals performance plan.

    No later than December 15 of each year, each State shall submit an 
appeals performance plan showing how it will operate during the 
following calendar year so as to achieve or maintain the issuance of at 
least 60 percent of all first level benefit appeals decisions within 30 
days of the date of appeal, and 80 percent within 45 days.

(Approved by the Office of Management and Budget under control number 
1205-0132)

(Pub. L. No. 96-511)

[41 FR 6757, Feb. 13, 1976, as amended at 49 FR 18295, Apr. 30, 1984; 71 
FR 35517, June 21, 2006]



PART 651_GENERAL PROVISIONS GOVERNING THE FEDERAL-STATE EMPLOYMENT 
SERVICE SYSTEM--Table of Contents





Sec.  651.10  Definitions of terms used in parts 651-658.

    Administrator, Office of Workforce Investment (OWI Administrator) 
means the chief official of the Office of Workforce Investment (OWI) or 
the Administrator's designee.
    Affirmative action means positive, result-oriented action imposed on 
or assumed by an employer pursuant to legislation, court order, consent 
decree, directive of a fair employment practice authority, government 
contract, grant or loan, or voluntary affirmative action plan adopted 
pursuant to the Affirmative Action Guidelines of the Equal Employment 
Opportunity Commission to provide equal employment opportunities for 
members of a specified group which for reasons of past custom, 
historical practice, or other nonoccupationally valid purposes has been 
discouraged from entering certain occupational fields.

[[Page 429]]

    Agricultural worker means a worker, whose primary work experience 
has been in farmwork in industries with a North American Industry 
Classification System (NAICS) 111, 112, and 115 (excluding the following 
codes: 1125 (under 112) and 1152 and 1153 (under 115)), whether alien or 
citizen, who is legally allowed to work in the United States.
    Applicant means a person who files an application for services with 
a local office of a State agency, with outstationed staff or with an 
outreach worker.
    Application card means the basic local office record for an 
applicant.
    A Bona Fide Occupational Qualification (BFOQ) means that an 
employment decision or request based on age, sex, national origin or 
religion is based on a finding that such characteristic is necessary to 
the individual's ability to perform the job in question. Since a BFOQ is 
an exception to the general prohibition against discrimination on the 
basis of age, sex, national origin or religion, it must be interpreted 
narrowly in accordance with the Equal Employment Opportunity Commission 
regulations set forth at 29 CFR parts 1604, 1605 and 1627.
    Clearance means activities in the placement process involving joint 
action of local offices in different labor market areas and/or States in 
the location, selection and the job referral of an applicant.
    Complaint means a representation made or referred to a State or 
local JS office of a violation of the JS regulations and/or other 
federal, State or local employment related law.
    Complainant means the individual, employer, organization, 
association, or other entity filing a complaint.
    Day-haul means the assembly of workers at a pick-up point waiting to 
be employed, transportation of them to farm employment, and the return 
of the workers to the pick-up point on the same day. For the purposes of 
this definition ``day-haul'' shall exclude transportation and return of 
workers employed under regularly scheduled job orders such as corn 
detasseling jobs for youth.
    Decertification means the rescission by the Secretary of the year 
end certification made under Section 7 of the Wagner-Peyser Act to the 
Secretary of the Treasury that the State agency may receive funds 
authorized by the Wagner-Peyser Act.
    DOL means the Department of Labor.
    Employment and Training Administration (ETA) means the component of 
the Department of Labor containing the United States Employment Service 
(USES).
    Employer means a person, firm, corporation or other association or 
organization (1) which currently has a location within the United States 
to which U.S. workers may be referred for employment, and which proposes 
to employ a worker at a place within the United States and (2) which has 
an employer relationship with respect to employees under this subpart as 
indicated by the fact that it hires, pays, fires, supervises and 
otherwise controls the work of such employee. An association of 
employers shall be considered an employer if it has all of the indicia 
of an employer set forth in this definition. Such an association, 
however, shall be considered as a joint employer with the employer 
member if either shares in exercising one or more of the definitional 
indicia.
    Establishment means a public or private economic employing unit 
generally at a single physical location which produces and/or sells 
goods or services, for example, a mine, factory, store, farm orchard or 
ranch. It is usually engaged in one, or predominantly one, type of 
commerical or governmental activity. Each branch or subsidiary unit of a 
large employer in a geographical area or community should be considered 
an individual establishment, except that all such units in the same 
physical location shall be considered a single establishment. A 
component of an establishment which may not be located in the same 
physical structure (such as the warehouse of a department store) should 
also be considered as part of the parent establishment. For the purpose 
of the ``seasonal farmworker'' definition, farm labor contractors and 
crew leaders are not considered establishments; it is the organizations 
to which they supply the workers that are the establishments.

[[Page 430]]

    Farmwork means work performed for wages in agricultural production 
or agricultural services North American Industry Classification System 
(NAICS) 111, 112, and 115 (excluding the following codes: 1125 (under 
112) and 1152 and 1153 (under 115)).
    Farmworker, see Agricultural worker.
    Full application means an application for an applicant who has 
participated in an application interview and which includes the 
applicant's personal characteristics, work history and an occupational 
classification and DOT code.
    Hearing Officer means a Department of Labor Administrative Law 
Judge, designated to preside at DOL administrative hearings.
    Identification card (applicant identification card) means a card 
given to the applicant on which are recorded identifying information and 
the dates of the applicant's visits to the local employment office.
    Intrastate job order means a job order describing one or more hard-
to-fill job openings, which a local office uses to request recruitment 
assistance from other local offices within the State.
    JS regulations means the Federal regulations at 20 CFR parts 601-
604, 620, 621, and 651-658, and at 29 CFR parts 8, 26, and 75.
    Job bank means a computer assisted system which provides listings of 
current job openings in the area, on a regular basis, for distribution 
to JS offices and to cooperating agencies.
    Job development means the process of securing a job interview with a 
public or private employer for a specific applicant for whom the local 
office has no suitable opening on file.
    Job information means information derived from data compiled in the 
normal course of employment service activities from reports, job orders, 
applications and the like.
    Job opening means a single job opportunity for which the local 
office has on file a request to select and refer on applicant or 
applicants.
    Job Information Service (JIS) means a unit or an area within a JS 
local office where applicants primarily, on a self-service basis or with 
minimum professional help, can obtain specific and general information 
on where and how to get a job.
    Job referral means (1) the act of bringing to the attention of an 
employer an applicant or group of applicants who are available for 
specific job openings and (2) the record of such referral. ``Job 
referral'' means the same as ``referral to a job.''
    Job Service (JS) means the nationwide system of public employment 
offices, funded through the United States Employment Service (USES) as 
grantee State agencies, and the various offices of the State agencies.
    Labor market area means a geographic area consisting of a central 
city (or cities) and the surrounding territory within a reasonable 
commuting distance.
    Labor Market Information (LMI) means that body of knowledge 
pertaining to the socio-economic forces influencing the employment 
process in specific labor market areas. These forces, which affect labor 
demand-supply relationships and define the content of the LMI program, 
include population and growth charcteristics, trends in industrial and 
occupational structure, technological developments, shifts in consumer 
demands, unionization, trade disputes, retirement practices, wage 
levels, conditions of employment, training opportunities, job vacancies, 
and job search information.
    Local office manager means the JS official in charge of all JS 
activities in a local office of a State agency.
    LMI means labor market information.
    Migrant farmworker is a seasonal farmworker who had to travel to do 
the farmwork so that he/she was unable to return to his/her permanent 
residence within the same day. Full-time students traveling in organized 
groups rather than with their families are excluded.
    Migrant food processing worker means a person who during the 
preceding 12 months has worked at least an aggregate of 25 or more days 
or parts of days in which some work was performed in food processing (as 
classified in the North American Industry Classification System (NAICS) 
311411, 311611, 311421 for food processing establishments), earned at 
least half of his/her earned income from processing work

[[Page 431]]

and was not employed in food processing year round by the same employer, 
provided that the food processing required travel such that the worker 
was unable to return to his/her permanent residence in the same day. 
Migrant food processing workers who are full-time students but who 
travel in organized groups rather than with their families are excluded.
    MSFW means a migrant farmworker, a migrant food processing worker, 
or a seasonal farmworker.
    Occupational Information Network (O*NET) means the online reference 
database which contains detailed descriptions of U.S. occupations, 
distinguishing characteristics, classification codes, and information on 
tasks, knowledge, skills, abilities, and work activities as well as 
information on interests, work styles, and work values.
    O*NET-SOC means Standard Occupational Classification (SOC) titles 
and codes are used by Federal statistical agencies to classify workers 
into occupational categories for the purpose of collecting, calculating 
and disseminating data. DOL uses O*NET-SOC titles and codes for the 
purposes of reporting data on training, certifications, and placement in 
employment by occupation.
    Partial application means the application of an applicant who has 
not participated in an application interview and which does not include 
an occupational classification of DOT code. Partial applications 
prepared for Migrants and Seasonal Farmworkers must include a signed 
waiver for full services at that time in accordance with 20 CFR 653.103.
    Placement means the hiring by a public or private employer of an 
individual referred by the employment office for a job or an interview, 
provided that the employment office completed all of the following 
steps:
    (a) Prepared a job order form prior to referral, except in the case 
of a job development contact on behalf of a specific applicant;
    (b) Made prior arrangements with the employer for the referral of an 
individual or individuals;
    (c) Referred an individual who had not been specifically designated 
by the employer, except for referrals on agricultural job orders for a 
specific crew leader or worker;
    (d) Verified from a reliable source, preferably the employer, that 
the individual had entered on a job; and
    (e) Appropriately recorded the placement.
    Program Budget Plan (PBP) means the annual planning document for the 
SWA required by Sec. 8 of the Wagner-Peyser Act containing the SWA's 
detailed planning, programming and budget for carrying out employment 
security activities. For the purpose of JS regulations, this definition 
shall be restricted to the employment service portion of the PBP.
    Public housing means housing operated by or on behalf of any public 
agency.
    RA; see Regional Administrator.
    Regional Administrator, Employment and Training Administration (RA) 
means the chief DOL Employment and Training Administration (ETA) 
official in each DOL regional office.
    Respondent means the employer or State agency (including a State 
agency official) who is alleged to have committed the violation 
described in a complaint.
    Rural area means an area which is not included in the urban area of 
a Standard Metropolitan Statistical Area and which has a population of 
less than 10,000.
    Seasonal farmworker means a person who during the preceding 12 
months worked at least an aggregate of 25 or more days or parts of days 
in which some work was performed in farmwork, earned at least half of 
his/her earned income from farmwork, and was not employed in farmwork 
year round by the same employer. For the purposes of this definition 
only, a farm labor contractor is not considered an employer. Non-migrant 
individuals who are full-time students are excluded.
    Secretary means the Secretary of the U.S. Department of Labor or the 
Secretary's designee.
    Significant MSFW States shall be those States designated annually by 
ETA and shall include the twenty (20) States with the highest number of 
MSFW applicants.
    Significant MSFW local offices shall be those designated annually by 
ETA and

[[Page 432]]

include those local offices where MSFWs account for 10% or more of 
annual applicants and those local offices which the Administrator 
determines should be included due to special circumstances such as an 
estimated large number of MSFWs in the local office service area. In no 
event shall the number of significant MSFW local offices be less than 
100 offices on a nationwide basis.
    Significant bilingual MSFW local offices shall be those designated 
annually by ETA and include those significant MSFW offices where 10% or 
more of MSFW applicants are estimated to require service provisions in 
Spanish unless the Administrator determines other local offices also 
should be included due to special circumstances.
    Solicitor means the chief legal officer of the U.S. Department of 
Labor or the Solicitor's designee.
    Standard Metropolitan Statistical Area (SMSA) means a metropolitan 
area designated by the Bureau of Census which contains (1) at least one 
city of 50,000 inhabitants or more, or (2) twin cities with a combined 
population of at least 50,000.
    State shall include the fifty States, the District of Columbia, 
Guam, Puerto Rico, and the Virgin Islands.
    State Administrator means the chief official of the State Employment 
Security Agency (SESA).
    State agency means the State job service agency designated under 
section 4 of the Wagner-Peyser Act to cooperate with the USES in the 
operation of the job service system.
    State hearing official means a State official designated to preside 
at State administrative hearings convened to resolve JS-related 
complaints pursuant to subpart E of part 658 of this chapter.
    State Workforce Agency (SWA), formerly State Employment Security 
Agency or SESA, means the State agency which, under the State 
Administrator, is designated by the Governor to administer Wagner-Peyser 
Act funded employment and workforce information services (State Agency) 
and the State unemployment compensation program.
    Supportive services means services other than employment or training 
that are needed to enable individuals to obtain or retain employment, or 
to participate in employment and training programs.
    Tests means a standardized method of measuring an individual's 
possession of, interest in, or ability to acquire, job skills and 
knowledge. Use of tests by employment service staff must be in 
accordance with the provisions of:
    (1) 41 CFR part 60-3, Uniform Guidelines on Employee Selection 
Procedures;
    (2) 29 CFR part 1627, Records To Be Made or Kept Relating to Age; 
Notices To Be Posted; Administrative Exemptions; and
    (3) The Department of Labor's regulations on Nondiscrimination on 
the Basis of Handicap in Programs and Activities Receiving or Benefiting 
from Federal Financial Assistance, which have been published as 29 CFR 
part 32 at 45 FR 66706 (Oct. 7, 1980).
    Training means a planned, systematic sequence of instruction or 
other learning experience on an individual or group basis under 
competent supervision, which is designed to impart skills, knowledge, or 
abilities to prepare individuals for employment.
    Transaction means a single ES activity performed on behalf of an 
individual seeking assistance and/or the result of such an activity, 
e.g., applicant registration referral to a job, referral to a supportive 
service, counseling interview, testing, job development, job placement, 
enrollment in training, and inactivation of an applicant registration.
    United States Employment Service (USES) means the component of the 
Employment and Training Administration of DOL which was established 
under the Wagner-Peyser Act of 1933 to promote and develop a national 
system of public job service offices.
    Vocational Plan means a plan developed jointly by a counselor or 
counselor trainee and the applicant which describes: (1) The applicant's 
short-range and long-range occupational goals and (2) the actions to be 
taken to place the plan into effect.

(Wagner-Peyser Act of 1933, as amended, 29 U.S.C. 49 et seq.; 5 U.S.C. 
301; and 38 U.S.C. chapters 41 and 42)

[45 FR 39457, June 10, 1980. Redesignated and amended at 7767, 7768, 
Jan. 23, 1981; 71 FR 35517, June 21, 2006]

[[Page 433]]



PART 652_ESTABLISHMENT AND FUNCTIONING OF STATE EMPLOYMENT SERVICES--
Table of Contents



                 Subpart A_Employment Service Operations

Sec.
652.1 Introduction and definitions.
652.2 Scope and purpose of the employment service system.
652.3 Basic labor exchange system.
652.4 Allotment of funds and grant agreement.
652.5 Services authorized.
652.6-652.7 [Reserved]
652.8 Administrative provisions.
652.9 Labor disputes.

                     Subpart B_Services for Veterans

652.100 Services for veterans.

   Subpart C_Wagner-Peyser Act Services in a One-Stop Delivery System 
                               Environment

652.200 What is the purpose of this subpart?
652.201 What is the role of the State agency in the One-Stop delivery 
          system?
652.202 May local Employment Service Offices exist outside of the One-
          Stop service delivery system?
652.203 Who is responsible for funds authorized under the Act in the 
          workforce investment system?
652.204 Must funds authorized under section 7(b) of the Act (the 
          Governor's reserve) flow through the One-Stop delivery system?
652.205 May funds authorized under the Act be used to supplement funding 
          for labor exchange programs authorized under separate 
          legislation?
652.206 May a State use funds authorized under the Act to provide ``core 
          services'' and ``intensive services'' as defined in WIA?
652.207 How does a State meet the requirement for universal access to 
          services provided under the Act?
652.208 How are core services and intensive services related to the 
          methods of service delivery described inSec. 652.207(b)(2)?
652.209 What are the requirements under the Act for providing 
          reemployment services and other activities to referred UI 
          claimants?
652.210 What are the Act's requirements for administration of the work 
          test and assistance to UI claimants?
652.211 What are State planning requirements under the Act?
652.212 When should a State submit modifications to the five-year plan?
652.213 What information must a State include when the plan is modified?
652.214 How often may a State submit modifications to the plan?
652.215 Do any provisions in WIA change the requirement that State 
          merit-staff employees must deliver services provided under the 
          Act?
652.216 May the One-Stop operator provide guidance to State merit-staff 
          employees in accordance with the Act?

    Authority: 29 U.S.C. 49k; 38 U.S.C. chapters 41 and 42.



                 Subpart A_Employment Service Operations

    Source: 48 FR 50665, Nov. 2, 1983, unless otherwise noted.



Sec.  652.1  Introduction and definitions.

    (a) These regulations implement the provisions of the Wagner-Peyser 
Act, known hereafter as the Act, as amended by the Workforce Investment 
Act of 1998 (WIA). Congress intended that the States exercise broad 
authority in implementing provisions of the Act.
    (b) Except as otherwise provided the definitions contained in 
section 2 of the Act apply to these regulations.
    Act means the Wagner-Peyser Act (29 U.S.C. 49 et seq.).
    Department means the United States Department of Labor (DOL), 
including its agencies and organizational units.
    Governor means the chief executive of any State.
    JTPA means the Job Training Partnership Act of 1982 (29 U.S.C. 1501 
et seq.).
    State means any of the several States, the District of Columbia, the 
Commonwealth of Puerto Rico, the Virgin Islands, and Guam.
    State Agency means the State governmental unit designated under 
section 4 of the Act to cooperate with the Secretary in the operation of 
the public employment service system.
    State Workforce Investment Board (State Board) means the entity 
within a State appointed by the Governor under section 111 of the 
Workforce Investment Act.
    WIA means the Workforce Investment Act of 1998 (29 U.S.C. 2801 et 
seq.).

[48 FR 50665, Nov. 2, 1983, as amended at 64 FR 18761, Apr. 15, 1999; 65 
FR 49462, Aug. 11, 2000]

[[Page 434]]



Sec.  652.2  Scope and purpose of the employment service system.

    The basic purpose of the employment service system is to improve the 
functioning of the nation's labor markets by bringing together 
individuals who are seeking employment and employers who are seeking 
workers.



Sec.  652.3  Basic labor exchange system.

    At a minimum, each State shall administer a labor exchange system 
which has the capacity:
    (a) To assist jobseekers in finding employment;
    (b) To assist employers in filling jobs;
    (c) To facilitate the match between jobseekers and employers;
    (d) To participate in a system for clearing labor between the 
States, including the use of standardized classification systems issued 
by the Secretary, under section 15 of the Act; and.
    (e) To meet the work test requirements of the State unemployment 
compensation system.

[48 FR 50665, Nov. 2, 1983, as amended at 64 FR 18762, Apr. 15, 1999]



Sec.  652.4  Allotment of funds and grant agreement.

    (a) Allotments. The Secretary shall provide planning estimates in 
accordance with section 6(b)(5) of the Act. Within 30 days of receipt of 
planning estimates from the Secretary, the State shall make public the 
substate resource distributions, and describe the process and schedule 
under which these resources will be issued, planned and committed. This 
notification shall include a description of the procedures by which the 
public may review and comment on the substate distributions, including a 
process by which the State will resolve any complaints.
    (b) Grant Agreement. To establish a continuing relationship under 
the Act, the Governor and the Secretary shall sign a Governor/Secretary 
Agreement, including a statement assuring that the State shall comply 
with the Act and all applicable rules and regulations. Consistent with 
this Agreement and section 6 of the Act, State allotments will be 
obligated through a Notification of Obligation.

(Approved by the Office of Management and Budget under control number 
1205-0209)



Sec.  652.5  Services authorized.

    The sums allotted to each State under section 6 of the Act must be 
expended consistent with an approved plan under 20 CFR 661.220 through 
661.240 and Sec.Sec. 652.211 through 652.214. At a minimum, each State 
shall provide the basic labor exchange elements atSec. 652.3.

[65 FR 49462, Aug. 11, 2000]



Sec.Sec. 652.6-652.7  [Reserved]



Sec.  652.8  Administrative provisions.

    (a) Administrative requirements. The Employment Security Manual 
shall not be applicable to funds appropriated under the Wagner-Peyser 
Act. Except as provided for in paragraph (f) of this section, 
administrative requirements and cost principles applicable to grants 
under this part 652 are as specified in 29 CFR part 97, Uniform 
Administrative Requirements for Grants and Cooperative Agreements to 
State and Local Governments, and OMB Circular A-87 (Revised).
    (b) Management systems, reporting and recordkeeping. (1) The State 
shall ensure that financial systems provide fiscal control and 
accounting procedures sufficient to permit preparation of required 
reports, and the tracing of funds to a level of expenditure adequate to 
establish that funds have not been expended in violation of the 
restrictions on the use of such funds (section 10(a)).
    (2) The financial management system and the program information 
system shall provide federally required records and reports that are 
uniform in definition, accessible to authorized Federal and State staff, 
and verifiable for monitoring, reporting, audit and evaluation purposes 
(section 10(c)).
    (c) Reports required. (1) Each State shall make reports pursuant to 
instructions issued by the Secretary and in such format as the Secretary 
shall prescribe.
    (2) The Secretary is authorized to monitor and investigate pursuant 
to section 10 of the Act.

[[Page 435]]

    (d) Special administrative and cost provisions. (1) Neither the 
Department nor the State is a guarantor of the accuracy or truthfulness 
of information obtained from employers or applicants in the process of 
operating a labor exchange activity.
    (2) Prior approval authority, as described in various sections of 29 
CFR part 97, Uniform Administrative Requirements for Grants and 
Cooperative Agreements to State and Local Governments, and OMB Circular 
A-87 (Revised), is delegated to the State except that the Secretary 
reserves the right to require transfer of title on nonexpendable 
Automated Data Processing Equipment (ADPE), in accordance with 
provisions contained in 29 CFR 97.32(g). The Secretary reserves the 
right to exercise prior approval authority in other areas, after 
providing advance notice to the State.
    (3) Application for financial assistance and modification 
requirements shall be as specified under this part.
    (4) Cost of promotional and informational activities consistent with 
the provisions of the Act, describing services offered by employment 
security agencies, job openings, labor market information, and similar 
items are allowable.
    (5) Each State shall retain basic documents for the minimum period 
specified below:
    (i) Work Application: One year.
    (ii) Job Order: One Year.
    (6) Costs of employer contributions and expenses incurred for State 
agency fringe benefit plans that do not meet the requirements in OMB 
Circular A-87 (Revised) are allowable, provided that:
    (i) For retirement plans, on behalf of individuals employed before 
the effective date of this part, the plan is authorized by State law and 
previously approved by the Secretary; the plan is insured by a private 
insurance carrier which is licensed to operate this type of plan; and 
any dividends or similar credits due to participation in the plan are 
credited against the next premium falling due under the contract;
    (ii) For retirement plans on behalf of individuals employed after 
the effective date of this part, and for fringe benefit plans other than 
retirement, the Secretary grants a time extension to cover an interim 
period if State legislative action is required for such employees to be 
covered by plans which meet the requirements of OMB Circular A-87 
(Revised). During this interim period, State agency employees may be 
enrolled in plans open to State agency employees only. No such extension 
may continue beyond the 60th day following the completion of the next 
full session of the State legislature which begins after the effective 
date of this part;
    (iii) For fringe benefit plans other than retirement, the Secretary 
grants a time extension which may continue until such time as they are 
comparable in cost to those fringe benefit plans available to other 
similarly employed employees of the State on the condition that there 
are no benefit improvements. The Secretary may grant this time extension 
if the State agency can demonstrate that the extension is necessary to 
prevent loss of benefits to current States agency employees, retireees 
and/or their fringe benefit plan beneficiaries, or that it is necessary 
to avoid unreasonable expenditures on behalf of the employee or employer 
to maintain such fringe benefits for current employees and retirees. At 
such time as the cost of these fringe benefit plans becomes equitable 
with those available to other similarly employed State employees, the 
time extension will cease and the requirements of OMB Circular A-87 
(Revised) will apply;
    (iv) Requests for time extensions under this section will include an 
opinion of the State Attorney General, that either legislative action is 
required to accomplish compliance with OMB Circular A-87 (Revised) or, 
for (d)(6)(iii) of this section that such compliance would result in 
either loss of current benefits to State agency employees and retirees 
or unreasonable expenditures to maintain these benefits. Such requests 
will be filed with the Secretary no later than 30 days after the 
effective date of this part; and
    (v) Time extensions granted relative to (d)(6)(iii) of this section 
require a signed statement by the State agency Administrator, that no 
improvements have been made to fringe benefits under the extension and 
that the

[[Page 436]]

plan(s) is (are) not consistent with those available to other similarly 
employed State employees, for each year of the extension. Documentation 
supporting the affidavit shall be maintained for audit purposes.
    (7) Payments from the State's Wagner-Peyser allotment made into a 
State's account in the Unemployment Trust Fund for the purpose of 
reducing charges against Reed Act funds (section 903(c) of the Social 
Security Act, as amended (42 U.S.C. 1103(c)) are allowable costs, 
provided that:
    (i) The charges against Reed Act funds were for amounts 
appropriated, obligated, and expended for the acquisition of automatic 
data processing installations or for the acquisition or major renovation 
of State owned office building; and
    (ii) With respect to each acquisition of improvement of property 
pursuant to paragraph (d)(7)(i) of this section, the payments are 
accounted for in the State's records as credits against equivalent 
amounts of Reed Act Funds used for administrative expenditures.
    (e) Disclosure of information. (1) The State shall assure the proper 
disclosure of information pursuant to section 3(b) of the Act.
    (2) The information specified in section 3(b) and other sections of 
the Act, shall also be provided to officers or any employee of the 
Federal Government of a State government lawfully charged with 
administration of unemployment compensation laws, employment service 
activities under the Act or other related legislation, but only for 
purposes reasonably necessary for the proper administration of such 
laws.
    (f) Audits, (1) At least once every 2 years, the State shall prepare 
or have prepared an independent financial and compliance audit covering 
each full program year not covered in the previous audit, except that 
funds expended pursuant to section 7(b) of the Act shall be audited 
annually.
    (2) The Comptroller General and the Inspector General of the 
Department shall have the authority to conduct audits, evaluations or 
investigations necessary to meet their responsibilities under sections 
9(b)(1) and 9(b)(2), respectively, of the Act.
    (3) The audit, conducted pursuant to paragraph (f)(1) or (f)(2) of 
this section, shall be submitted to the Secretary who shall make an 
initial determination. Such determinations shall be based on the 
requirements of the Act, regulations, and State plan.
    (i) The initial determination shall identify the audit findings, 
state the Secretary's proposed determination of the allowability of 
questioned costs and activities, and provide for informal resolution of 
those matters in controversy contained in the initial determination.
    (ii) The Secretary shall not impose sanctions and corrective actions 
without first providing the State with an opportunity to present 
documentation or arguments to resolve informally those matters in 
controversy contained in the Secretary's initial determination. The 
informal resolution period shall be at least 60 days from issuance of 
the initial determination and no more that 170 days from the receipt by 
the Secretary of the final approved audit report. If the matters are 
resolved informally, the Secretary shall issue a final determination 
pursuant to paragraph (f)(3)(iii) of this section which notifies the 
parties in writing of the nature of the resolution and may close the 
file.
    (iii) If the matter is not resolved informally, the Secretary shall 
provide each party with a final written determination by certified mail, 
return receipt requested. In the case of audits, the final determination 
shall be issued not later than 180 days after the receipt by the 
Secretary of the final approved audit report. The final determination 
shall:
    (A) Indicate that efforts to resolve informally matters contained in 
the initial determination have been unsuccessful;
    (B) List those matters upon which the parties continue to disagree;
    (C) List any modifications to the factual findings and conclusions 
set forth in the initial determination;
    (D) Establish a debt if appropriate;
    (E) Determine liability, method of restitution of funds and 
sanctions;
    (F) Offer an opportunity for a hearing in accordance with 20 CFR 
658.707

[[Page 437]]

through 658.711 in the case of a final determination imposing a sanction 
or corrective action; and
    (G) Constitute final agency action unless a hearing is requested.
    (g) Sanctions for violation of the Act. (1) The Secretary may impose 
appropriate sanctions and corrective actions for violation of the Act, 
regulations, or State plan, including the following:
    (i) Requiring repayment, for debts owed the Government under the 
grant, from non-Federal funds;
    (ii) Offsetting debts arising from the misexpenditure of grant 
funds, against amounts to which the State is or may be entitled under 
the Act, provided that debts arising from gross negligence or willful 
misuse of funds shall not be offset against future grants. When the 
Secretary reduces amounts allotted to the State by the amount of the 
misexpenditure, the debt shall be fully satisfied;
    (iii) Determining the amount of Federal cash maintained by the State 
or a subrecipient in excess of reasonable grant needs, establishing a 
debt for the amount of such excessive cash, and charging interest on 
that debt;
    (iv) Imposing other appropriate sanctions or corrective actions, 
except where specifically prohibited by the Act or regulations.
    (2) To impose a sanction or corrective action, the Secretary shall 
utilize the initial and final determination procedures outlined in 
(f)(3) of this section.
    (h) Other violations. Violations or alleged violations of the Act, 
regulations, or grant terms and conditions except those pertaining to 
audits or discrimination shall be determined and handled in accordance 
with 20 CFR part 658, subpart H.
    (i) Fraud and abuse. Any persons having knowledge of fraud, criminal 
activity or other abuse shall report such information directly and 
immediately to the Secretary. Similarly, all complaints involving such 
matters should also be reported to the Secretary directly and 
immediately.
    (j) Nondiscrimination and affirmative action requirements. States 
shall:
    (1) Assure that no individual be excluded from participation in, 
denied the benefits of, subjected to discrimination under, or denied 
employment in the administration or in connection with any services or 
activities authorized under the Act in violation of any applicable 
nondiscrimination law, including laws prohibiting discrimination on the 
basis of age, race, sex, color, religion, national origin, disability, 
political affiliation or belief. All complaints alleging discrimination 
shall be filed and processed according to the procedures in the 
applicable DOL nondiscrimination regulations.
    (2) Assure that discriminatory job orders will not be accepted, 
except where the stated requirement is a bona fide occupational 
qualification (BFOQ). See, generally, 42 U.S.C. 2000(e)-2(e), 29 CFR 
parts 1604, 1606, 1625.
    (3) Assure that employers' valid affirmative action requests will be 
accepted and a significant number of qualified applicants from the 
target group(s) will be included to enable the employer to meet its 
affirmative action obligations.
    (4) Assure that employment testing programs will comply with 41 CFR 
part 60-3 and 29 CFR part 32 and 29 CFR 1627.3(b)(iv).
    (5) Nondiscrimination and equal opportunity requirements and 
procedures, including complaint processing and compliance reviews, will 
be governed by the applicable DOL nondiscrimination regulations.

[48 FR 50665, Nov. 2, 1983, as amended at 64 FR 18762, Apr. 15, 1999; 65 
FR 49462, Aug. 11, 2000]



Sec.  652.9  Labor disputes.

    (a) State agencies shall make no job referral on job orders which 
will aid directly or indirectly in the filling of a job opening which is 
vacant because the former occupant is on strike, or is being locked out 
in the course of a labor dispute, or the filling of which is otherwise 
an issue in a labor dispute involving a work stoppage.
    (b) Written notification shall be provided to all applicants 
referred to jobs not at issue in the labor dispute that a labor dispute 
exists in the employing establishment and that the job to which the 
applicant is being referred is not at issue in the dispute.
    (c) When a job order is received from an employer reportedly 
involved in a

[[Page 438]]

labor dispute involving a work stoppage, State agencies shall:
    (1) Verify the existence of the labor dispute and determine its 
significance with respect to each vacancy involved in the job order; and
    (2) Notify all potentially affected staff concerning the labor 
dispute.
    (d) State agencies shall resume full referral services when they 
have been notified of, and verified with the employer and workers' 
representative(s), that the labor dispute has been terminated.
    (e) State agencies shall notify the regional office in writing of 
the existence of labor disputes which:
    (1) Result in a work stoppage at an establishment involving a 
significant number of workers; or
    (2) Involve multi-establishment employers with other establishments 
outside the reporting State.



                     Subpart B_Services for Veterans



Sec.  652.100  Services for veterans.

    Services for veterans are administered by the Office of the 
Assistant Secretary for Veterans' Employment and Training (OASVET). 
OASVET's general regulations are located in chapter IX of this title.

[54 FR 39354, Sept. 26, 1989]



   Subpart C_Wagner-Peyser Act Services in a One-Stop Delivery System 
                               Environment

    Source: 65 FR 49462, Aug. 11, 2000, unless otherwise noted.



Sec.  652.200  What is the purpose of this subpart?

    (a) This subpart provides guidance to States to implement the 
services provided under the Act, as amended by WIA, in a One-Stop 
delivery system environment.
    (b) Except as otherwise provided, the definitions contained at 
subpart A of this part and section 2 of the Act apply to this subpart.



Sec.  652.201  What is the role of the State agency in the One-Stop
delivery system?

    (a) The role of the State agency in the One-Stop delivery system is 
to ensure the delivery of services authorized under section 7(a) of the 
Act. The State agency is a required One-Stop partner in each local One-
Stop delivery system and is subject to the provisions relating to such 
partners that are described at 20 CFR part 662.
    (b) Consistent with those provisions, the State agency must:
    (1) Participate in the One-Stop delivery system in accordance with 
section 7(e) of the Act;
    (2) Be represented on the Workforce Investment Boards that oversee 
the local and State One-Stop delivery system and be a party to the 
Memorandum of Understanding, described at 20 CFR 662.300, addressing the 
operation of the One-Stop delivery system; and
    (3) Provide these services as part of the One-Stop delivery system.



Sec.  652.202  May local Employment Service Offices exist outside of
the One-Stop service delivery system?

    (a) No, local Employment Service Offices may not exist outside of 
the One-Stop service delivery system.
    (b) However, local Employment Service Offices may operate as 
affiliated sites, or through electronically or technologically linked 
access points as part of the One-Stop delivery system, provided the 
following conditions are met:
    (1) All labor exchange services are delivered as a part of the local 
One-Stop delivery system in accordance with section 7(e) of the Act and 
Sec.  652.207(b);
    (2) The services described in paragraph (b)(1) of this section are 
available in at least one comprehensive physical center, as specified in 
20 CFR 662.100, from which job seekers and employers can access them; 
and
    (3) The Memorandum of Understanding between the State agency local 
One-Stop partner and the Local Workforce Investment Board meets the 
requirements of 20 CFR 662.300.

[[Page 439]]



Sec.  652.203  Who is responsible for funds authorized under the Act
in the workforce investment system?

    The State agency retains responsibility for all funds authorized 
under the Act, including those funds authorized under section 7(a) 
required for providing the services and activities delivered as part of 
the One-Stop delivery system.



Sec.  652.204  Must funds authorized under section 7(b) of the Act 
(the Governor's reserve) flow through the One-Stop delivery system?

    No, these funds are reserved for use by the Governor for the three 
categories of activities specified in section 7(b) of the Act. However, 
these funds may flow through the One-Stop delivery system.



Sec.  652.205  May funds authorized under the Act be used to 
supplement funding for labor exchange programs authorized under 
separate legislation?

    (a) Section 7(c) of the Act enables States to use funds authorized 
under sections 7(a) or 7(b) of the Act to supplement funding of any 
workforce activity carried out under WIA.
    (b) Funds authorized under the Act may be used under section 7(c) to 
provide additional funding to other activities authorized under WIA if:
    (1) The activity meets the requirements of the Act, and its own 
requirements;
    (2) The activity serves the same individuals as are served under the 
Act;
    (3) The activity provides services that are coordinated with 
services under the Act; and
    (4) The funds supplement, rather than supplant, funds provided from 
non-Federal sources.



Sec.  652.206  May a State use funds authorized under the Act to
provide ``core services'' and ``intensive services'' as defined 
in WIA?

    Yes, funds authorized under section 7(a) of the Act must be used to 
provide core services, as defined at section 134(d)(2) of WIA and 
discussed at 20 CFR 663.150, and may be used to provide intensive 
services as defined at WIA section 134(d)(3)(C) and discussed at 20 CFR 
663.200. Funds authorized under section 7(b) of the Act may be used to 
provide core or intensive services. Core and intensive services must be 
provided consistent with the requirements of the Act.



Sec.  652.207  How does a State meet the requirement for universal
access to services provided under the Act?

    (a) A State has discretion in how it meets the requirement for 
universal access to services provided under the Act. In exercising this 
discretion, a State must meet the Act's requirements.
    (b) These requirements are:
    (1) Labor exchange services must be available to all employers and 
job seekers, including unemployment insurance (UI) claimants, veterans, 
migrant and seasonal farmworkers, and individuals with disabilities;
    (2) The State must have the capacity to deliver labor exchange 
services to employers and job seekers, as described in the Act, on a 
Statewide basis through:
    (i) Self-service;
    (ii) Facilitated self-help service; and
    (iii) Staff-assisted service;
    (3) In each local workforce investment area, in at least one 
comprehensive physical center, staff funded under the Act must provide 
core and applicable intensive services including staff-assisted labor 
exchange services; and
    (4) Those labor exchange services provided under the Act in a local 
workforce investment area must be described in the Memorandum of 
Understanding (MOU).



Sec.  652.208  How are core services and intensive services related 
to the methods of service delivery described inSec. 652.207(b)(2)?

    Core services and intensive services may be delivered through any of 
the applicable three methods of service delivery described inSec. 
652.207(b)(2). These methods are:
    (a) Self-service;
    (b) Facilitated self-help service; and
    (c) Staff-assisted service.

[[Page 440]]



Sec.  652.209  What are the requirements under the Act for providing 
reemployment services and other activities to referred UI claimants?

    (a) In accordance with section 3(c)(3) of the Act, the State agency, 
as part of the One-Stop delivery system, must provide reemployment 
services to UI claimants for whom such services are required as a 
condition for receipt of UI benefits. Services must be provided to the 
extent that funds are available and must be appropriate to the needs of 
UI claimants who are referred to reemployment services under any Federal 
or State UI law.
    (b) The State agency must also provide other activities, including:
    (1) Coordination of labor exchange services with the provision of UI 
eligibility services as required by section 5(b)(2) of the Act;
    (2) Administration of the work test and provision of job finding and 
placement services as required by section 7(a)(3)(F) of the Act.



Sec.  652.210  What are the Act's requirements for administration of
the work test and assistance to UI claimants?

    (a) State UI law or rules establish the requirements under which UI 
claimants must register and search for work in order to fulfill the UI 
work test requirements.
    (b) Staff funded under the Act must assure that:
    (1) UI claimants receive the full range of labor exchange services 
available under the Act that are necessary and appropriate to facilitate 
their earliest return to work;
    (2) UI claimants requiring assistance in seeking work receive the 
necessary guidance and counseling to ensure they make a meaningful and 
realistic work search; and
    (3) UI program staff receive information about UI claimants' ability 
or availability for work, or the suitability of work offered to them.



Sec.  652.211  What are State planning requirements under the Act?

    The State agency designated to administer funds authorized under the 
Act must prepare for submission by the Governor, the portion of the 
five-year State Workforce Investment Plan describing the delivery of 
services provided under the Act in accordance with WIA regulations at 20 
CFR 661.220. The State Plan must contain a detailed description of 
services that will be provided under the Act, which are adequate and 
reasonably appropriate for carrying out the provisions of the Act, 
including the requirements of section 8(b) of the Act.



Sec.  652.212  When should a State submit modifications to the 
five-year plan?

    (a) A State may submit modifications to the five-year plan as 
necessary during the five-year period, and must do so in accordance with 
the same collaboration, notification, and other requirements that apply 
to the original plan. Modifications are likely to be needed to keep the 
strategic plan a viable and living document over its five-year life.
    (b) That portion of the plan addressing the Act must be updated to 
reflect any reorganization of the State agency designated to deliver 
services under the Act, any change in service delivery strategy, any 
change in levels of performance when performance goals are not met, or 
any change in services delivered by State merit-staff employees.



Sec.  652.213  What information must a State include when the plan 
is modified?

    A State must follow the instructions for modifying the strategic 
five-year plan in 20 CFR 661.230.



Sec.  652.214  How often may a State submit modifications to 
the plan?

    A State may modify its plan, as often as needed, as changes occur in 
Federal or State law or policies, Statewide vision or strategy, or if 
changes in economic conditions occur.



Sec.  652.215  Do any provisions in WIA change the requirement that
State merit-staff employees must deliver services provided 
under the Act?

    No, the Secretary requires that labor exchange services provided 
under the authority of the Act, including services to veterans, be 
provided by State merit-staff employees. This interpretation is 
authorized by and consistent with the provisions in sections 3(a) and

[[Page 441]]

5(b) of the Act and the Intergovernmental Personnel Act (42 U.S.C. 4701 
et seq.). The Secretary has and has exercised the legal authority under 
section 3(a) of the Act to set additional staffing standards and 
requirements and to conduct demonstrations to ensure the effective 
delivery of services provided under the Act. No additional 
demonstrations will be authorized.



Sec.  652.216  May the One-Stop operator provide guidance to State 
merit-staff employees in accordance with the Act?

    Yes, the One-Stop delivery system envisions a partnership in which 
Wagner-Peyser Act labor exchange services are coordinated with other 
activities provided by other partners in a One-Stop setting. As part of 
the local Memorandum of Understanding, the State agency, as a One-Stop 
partner, may agree to have staff receive guidance from the One-Stop 
operator regarding the provision of labor exchange services. Personnel 
matters, including compensation, personnel actions, terms and conditions 
of employment, performance appraisals, and accountability of State 
merit-staff employees funded under the Act, remain under the authority 
of the State agency. The guidance given to employees must be consistent 
with the provisions of the Act, the local Memorandum of Understanding, 
and applicable collective bargaining agreements.



PART 653_SERVICES OF THE EMPLOYMENT SERVICE SYSTEM--Table of Contents



Subpart A--Basic Services of the Employment Service System [Reserved]

     Subpart B_Services for Migrant and Seasonal Farmworkers (MSFWs)

Sec.
653.100 Purpose and scope of subpart.
653.101 Provision of services to migrant and seasonal farmworkers 
          (MSFWs).
653.102 Job information.
653.103 MSFW job applications.
653.104 Services to MSFW family members, farm labor contractors, and 
          crew members.
653.105 Job applications at day-haul facilities.
653.106 JS day-haul responsibilities.
653.107 Outreach.
653.108 State agency self-monitoring.
653.109 Data collection.
653.110 Disclosure of data.
653.111 State agency staffing requirements.
653.112 State agency program budget plans.
653.113 Processing apparent violations.

Subpart C--Services for Veterans [Reserved]

Subpart D--Services to the Handicapped [Reserved]

Subpart E--Support Services [Reserved]

             Subpart F_Agricultural Clearance Order Activity

653.500 Purpose and scope of subpart.
653.501 Requirements for accepting and processing clearance orders.
653.502 Changes in crop and recruitment situations.
653.503 Field checks.

    Authority: 38 U.S.C. chapters 41 and 42; Wagner-Peyser Act, as 
amended, 29 U.S.C. 49 et seq.; sec. 104 of the Emergency Jobs and 
Unemployment Assistance Act of 1974 Pub. L. 93-567, 88 Stat. 1845, 
unless otherwise noted.

Subpart A--Basic Services of the Employment Service System [Reserved]



     Subpart B_Services for Migrant and Seasonal Farmworkers (MSFWs)

    Source: 45 FR 39459, June 10, 1980, unless otherwise noted.



Sec.  653.100  Purpose and scope of subpart.

    This subpart sets forth the principal regulations of the United 
States Employment Service (USES) for counseling, testing, and job and 
training referral services for migrant and seasonal farmworkers (MSFWs) 
on a basis which is qualitatively equivalent and quantitatively 
proportionate to services provided to non-MSFWs. It also contains 
requirements that State agencies establish a system to monitor their own 
compliance with USES regulations governing services to MSFWs, including 
the regulations under this subpart. Special services to ensure that 
MSFWs receive the full range of employment

[[Page 442]]

related services are established under this subpart.



Sec.  653.101  Provision of services to migrant and seasonal 
farmworkers (MSFWs).

    (a) Each State agency and each local office shall offer to migrant 
and seasonal farmworkers (MSFWs) the full range of employment services, 
benefits and protections, including the full range of counseling, 
testing, and job and training referral services as are provided to non-
MSFWs. In providing such services, the State agency shall consider and 
be sensitive to the preferences, needs, and skills of individual MSFWs 
and the availability of job and training opportunities.
    (b) Each State agency shall assure that, in a local area, the same 
local offices, including itinerant and satellite offices, but exclusive 
of day-haul operations, offer services to both non-MSFWs and MSFWs. 
Separate farm labor service local offices, which offer only farmwork to 
agricultural workers while another local office serving the same 
geographical area offers other JS services to other applicants, are 
prohibited so that all applicants receive employment services on the 
same basis.



Sec.  653.102  Job information.

    All State agencies shall make job order information conspicuous and 
available to MSFWs in all local offices. This information shall include 
Job Bank information in local offices where it is available. Such 
information shall be made available either by computer terminal, 
microfiche, hard copy, or other equally effective means. Each 
significant MSFW local office shall provide adequate staff assistance to 
each MSFW to use the job order information effectively. In those offices 
designated as significant MSFW bilingual offices, such assistance shall 
be provided to MSFWs in Spanish and English, wherever requested or 
necessary, during any period of substantial MSFW activity.



Sec.  653.103  MSFW job applications.

    (a) Every local office shall determine whether or not applicants are 
MSFWs as defined atSec. 651.10 of this chapter.
    (b) Except as provided inSec. 653.105, when an MSFW applies for JS 
services at a local office or is contacted by an Outreach worker, the 
services available through the JS shall be explained to the MSFW. In 
local offices which have been designated as significant MSFW bilingual 
offices by ETA, this explanation shall be made in Spanish, if necessary 
or requested during any period of substantial MSFW activity. Other local 
offices shall provide bilingual explanations wherever feasible.
    (c) The local office staff member shall provide the MSFW a list of 
those services. The list shall be written in English and Spanish and 
shall specify those services which are available after completion of a 
full application and those services which are available after completion 
of a partial application. The JS staff member shall explain to each MSFW 
the advantages of completing a full application.

Applications shall be reviewed periodically by the local office manager 
or a member of his/her staff to ensure their accuracy and quality. 
Applications and the application-taking process shall also be reviewed 
during State and Federal onsite reviews by the State and Regional MSFW 
Monitor Advocates and/or review staff, who shall check overall accuracy 
and quality, and offer technical advice on corrections or improvements.
    (d) If the MSFW wishes to complete a full application, the staff 
shall provide all assistance necessary to complete the application and 
shall ensure that the form includes complete information. It shall 
include, to the extent possible, the significant history of the MSFW's 
prior employment, training and educational background and a statement of 
any desired employment and any training needs in order to permit a 
thorough assessment of the applicant's skills, abilities and 
preferences. All applicable items shall be completed according to the 
ETA instructions for preparation of the application card (ES-511). 
Additional Occupational Informational Network (O*NET) codes or keywords 
shall be assigned, where appropriate, based on the MSFW's work history, 
training, and skills, knowledges, and abilities. Secondary cards shall 
be completed and

[[Page 443]]

separately filed when keywords are not used. In extremely small local 
offices where the limited applicant load and file size does not require 
completion of secondary cards, additional O*NET-SOC codes shall be noted 
on the primary application card.
    (e) If an MSFW wishes any JS service, and does not wish or is unable 
to file a full application, the interviewer shall try to obtain as much 
information as possible for a partial application. The interviewer shall 
enter the information on the partial application. The interviewer shall 
offer to refer the applicant to any available jobs for which the MSFW 
may be qualified, and any JS services permitted by the limited 
information available. He/she shall advise the MSFW that he/she may file 
a full application at any time.
    (f) Partial applications shall be completed according to ETA 
instructions.
    (g) Partial applications for MSFWs shall be filed in accordance with 
local office procedures for filing other partial applications.
    (h) To minimize the need for additional applications in other 
offices, States shall issue JS cards to MSFWs at the initial visit under 
the following conditions:
    (1) When automated data retrieval systems are available in the 
State. In this instance, JS staff shall advise the MSFW that the JS card 
may be presented at any other JS office in the State and that services 
will be provided without completion of an additional application unless 
the services requested require additional information for adequate 
service delivery.
    (2) When an MSFW is referred on an interstate or intrastate order. 
In this instance, when it is known to the order-holding local office 
(through the presentation of an JS card or otherwise) that the MSFW has 
completed a full application or partial application in the applicant 
holding office or elsewhere, an additional application shall not be 
taken by the order-holding office unless the MSFW requests JS services 
in addition to referral on the clearance order.

(Approved by the Office of Management and Budget under control number 
1205-0039)

(Pub. L. No. 96-511, 94 Stat. 2812 (44 U.S.C. 3501 et seq.))

[45 FR 39459, June 10, 1980, as amended at 46 FR 7772, Jan. 23, 1981; 47 
FR 145, Jan. 5, 1982; 71 FR 35517, June 21, 2006]



Sec.  653.104  Services to MSFW family members, farm labor 
contractors, and crew members.

    (a) In addition to other requirements in this subpart, the following 
special requirements are established for services to MSFW family 
members, farm labor contractors and crew members. Except as provided at 
Sec.Sec. 653.103(e) and 653.105, no local office shall refer an MSFW 
family or crew unless each working member of the family or crew being 
referred, has filed either a full or partial application pursuant to 
Sec.  653.103(b) at a local office or has been issued a JS card in 
instances set forth inSec. 653.103(h). Local offices may, upon 
request, provide general information, e.g., the types of crops in other 
areas, to farm labor contractors and family heads prior to the 
registration of all working members.
    (b) No local office shall accept an application from an individual 
for employment as a farm labor contractor or fill an agricultural job 
order submitted by a farm labor contractor (``FLC'') or farm labor 
contractor employee (``FLCE'') unless the FLC or FLCE shows or obtains a 
valid FLC certificate, or FLCE identification card where required by 
Federal law, and a valid State certification where required by State 
law. If a FLC or FLCE is temporarily without his or her valid FLC 
certificate or FLCE identification card the local office shall try to 
verify the existence of the valid certificate or identification card by 
telephoning the State central office and/or the Department of Labor's 
Employment Standards Administration regional office. The local office, 
however, shall not serve the FLC or FLCE until the existence of the 
valid certificate or identification card is verified.
    (c) Local offices may refer workers to registered farm labor 
contractors who are employers provided that a valid job

[[Page 444]]

order has been placed with the local office which clearly specifies all 
the terms and conditions of employment with the farm labor contractor 
shown as employer of record. Before a local office may refer workers to 
a farm labor contractor offering employment in another area of the State 
or in another State, one of two requirements must be met: Either a valid 
interstate clearance order from another State agency is on file in the 
office, or an intrastate order has been received from an office in 
another area of the State which is not within commuting distance of the 
office where the farm labor contractor is recruiting workers. Unless one 
of these conditions exists, the local office may only refer workers to a 
registered farm labor contractor who is an employer placing a local job 
order. Whenever the job order includes the provision of transportation, 
a FLC certificate authorizing transportation must be shown before 
workers are referred on the order.



Sec.  653.105  Job applications at day-haul facilities.

    If the State agency is operating a day-haul facility under the 
exceptional circumstances provisions described inSec. 653.106(a), a 
list of JS services shall be distributed and a full application shall be 
completed whenever an MSFW requests the opportunity to file a full 
application unless this is impractical at that time. In such cases, a 
full application shall be taken at the earliest practical time. In all 
other cases, a list of JS services shall be distributed.



Sec.  653.106  JS day-haul responsibilities.

    (a) State agencies shall not establish, operate, or supervise any 
agricultural day-haul facilities unless exceptional circumstances 
warrant such action and prior approval of the Regional Administrator is 
obtained.
    (b) No JS applicants shall be referred to non-JS operated day-haul 
facilities, unless the applicant is referred on a specific job order and 
is provided with a checklist summarizing wages, working conditions, and 
other material specifications on the job order. Such checklists, where 
necessary, shall be in English and Spanish. State agencies shall use a 
standard checklist format provided by ETA unless a variance has been 
approved by the Regional Administrator. However, general labor market 
information on the availability of jobs, the level of activity of 
agricultural and nonagricultural employment, and crop conditions shall 
be provided, upon request, to applicants where specific referrals to 
employment cannot be made.
    (c) JS outreach workers shall visit all JS and non-JS operated day-
haul facilities with substantial activity during their operation for 
purposes of providing MSFWs with information and assistance pursuant to 
Sec.  653.107(j). Monitoring of such activity shall be conducted 
pursuant toSec. 653.108(p).

(Approved by the Office of Management and Budget under control number 
1205-0039)

(Pub. L. No. 96-511, 94 Stat. 2812 (44 U.S.C. 3501 et seq.))

[45 FR 39459, June 10, 1980, as amended at 47 FR 145, Jan. 5, 1982]



Sec.  653.107  Outreach.

    (a) Each State agency shall operate an outreach program in order to 
locate and to contact MSFWs who are not being reached by the normal 
intake activities conducted by the local offices. Upon receipt of 
planning instructions and resource guidance from ETA, each State agency 
shall develop an annual outreach plan, setting forth numerical goals, 
policies and objectives. This plan shall be subject to the approval of 
the Regional Administrator as part of the program budget plan (PBP) 
process. Wherever feasible, State agencies shall coordinate their 
outreach efforts with those of public and private community service 
agencies and MSFW groups.
    (b) In determining the extent of their outreach program, States 
shall be guided by the following statement of ETA policy:
    (1) State agencies should make sufficient penetration in the 
farmworker community so that a large number of MSFWs are aware of the 
full range of JS services.
    (2) Signficant MSFW Local offices should conduct especially vigorous 
outreach in their service areas.
    (3) State agencies in supply States should conduct particularly 
thorough outreach efforts with extensive follow-

[[Page 445]]

up activities which capitalize on the relatively long duration of MSFW 
residence in the State.
    (c) The plan shall be based on the actual conditions which exist in 
the particular State, taking into account the State agency's history of 
providing outreach services, the estimated number of MSFWs in the State, 
and the need for outreach services in that State. The approval of the 
Regional Administrator shall be based upon his/her consideration of the 
following features of the outreach plan:
    (1) Assessment of need. This assessment of need shall include:
    (i) A review of the previous year's agricultural activity in the 
State.
    (ii) A review of the previous year's MSFW activity in the State.
    (iii) A projected level of agricultural activity in the State for 
the coming year.
    (iv) A projected number of MSFWs in the State for the coming year, 
which shall take into account data supplied by WIA 167 National 
Farmworker Jobs Program grantees, other MSFW organizations, employer 
organizations and federal and/or State agency data sources such as the 
Department of Agriculture and the United States Employment Service.
    (v) A statement of the consideration given to the State Monitor 
Advocate's recommendation as set forth in the annual summary developed 
underSec. 653.108(t).
    (2) Assessment of available resources. This assessment of the 
resources available for outreach shall include:
    (i) The level of funds available from all sources, including the 
funds specifically made available to the State agency for outreach.
    (ii) Resources made available through existing cooperative 
agreements with public and private community service agencies and MSFW 
groups.
    (iii) Where fewer resources are available for outreach than in a 
prior year, a statement of why fewer resources are available.
    (3) Proposed outreach activities. The proposed outreach activities 
shall be designed to meet the needs determined under paragraph (c)(1) of 
this section with the available resources determined under paragraph 
(c)(2) of this section. The plan for the proposed outreach activities 
shall include:
    (i) Numerical goals for the number of MSFWs to contacted during the 
fiscal year by JS staff. The number of MSFWs planned to be contacted by 
other agencies under cooperative arrangements during the fiscal year 
also should be included in the plan. These numerical goals shall be 
based on the number of MSFWs estimated to be in the State in the coming 
year, taking into account the varying concentration of MSFWs during the 
seasons in each geographic area, the range of services needed in each 
area and the number of JS and/or cooperating agency staff who will 
conduct outreach.
    (ii) Numerical goals for the staff years to be utilized for outreach 
during the fiscal year.
    (iii) The level of funding to be utilized for outreach during the 
fiscal year.
    (iv) The tools which will be used to conduct outreach contacts, 
including personal contact, printed matter, videotapes, slides, and/or 
cassette recordings.
    (v) The records to be maintained by the JS outreach staff--logs of 
daily contacts to include the number of MSFWs contacted and assistance 
provided. The name of the individual contacted should be recorded when:
    (A) An application for work is taken by an outreach worker,
    (B) A referral to a job is made by an outreach worker, and/or
    (C) A complaint is taken by an outreach worker.
    (d) In developing the outreach plan, the State agency shall solicit 
information and suggestions from WIA 167 National Farmworker Jobs 
Program grantees, other appropriate MSFW groups, public agencies, 
agricultural employer organizations, and other interested organizations. 
In addition, at least 45 days before submitting its final outreach plan 
to the Regional Administrator, the State agency shall provide a proposed 
plan to WIA 167 National Farmworker Jobs Program grantees, public 
agencies, agricultural employer organizations, and other organizations 
expressing an interest and allow at

[[Page 446]]

least 30 days for review and comment. The State agency shall:
    (1) Consider any comments received in formulating its final proposed 
plan.
    (2) Inform all commenting parties in writing whether their comments 
have been incorporated and, if not, the reasons therefore.
    (3) Transmit the comments and recommendations received and its 
responses to the Regional Administrator with the submission of the plan. 
(If the comments are received after the submission of the plan, they may 
be sent separately to the Regional Administrator.)
    (e) The outreach plan shall be submitted as an essential part of the 
State's annual PBP. The resource requirement of the plan shall be 
reflected in the PBP budget request. The plan, including the resource 
requirement, shall be reviewed by the Regional Administrator during the 
annual PBP approval process. The State agency shall be required to 
implement the approved outreach plan as part of its compliance with the 
PBP.
    (f) The Regional Administrator shall review and evaluate the 
outreach plan, including the assessments of needs and resources, in 
light of the history of the State's outreach efforts and the statements 
of policy set forth inSec. 653.107(b). He/she shall approve the plan 
only if it demonstrates that adequate outreach will be conducted. The 
approved outreach plan shall be available for review by interested 
parties.
    (g) As part of the annual PBP process, funding of State agencies 
shall be contingent upon the substantial and timely compliance of the 
State agency with its prior year outreach plan. However, if the Regional 
Administrator makes a finding of good faith efforts, he/she may fund a 
State agency even though it did not achieve substantial and timely 
compliance.
    (h) For purposes of hiring and assigning staff to outreach duties, 
State agencies shall seek, through merit system procedures, qualified 
candidates:
    (1) Who are from MSFW backgrounds, and/or
    (2) Who speak Spanish, and/or
    (3) Who are racially or ethnically representative of the MSFWs in 
the service area.
    (i) The five States with the highest estimated year round MSFW 
activity shall assign, in accordance with State merit staff 
requirements, full-time, year round staff to outreach duties. The 
remainder of the significant MSFW states shall make maximum efforts to 
hire outreach staff with MSFW experience for year round positions and 
shall assign outreach staff to work full-time during the period of the 
highest MSFW activity. Such outreach staff shall be bilingual if 
warranted by the characteristics of the MSFW population in the State, 
and shall spend a majority of their time in the field. The Regional 
Administrator may grant approval for a deviation from the requirements 
of this section if the State agency provides adequate evidence that 
outreach activities and service delivery to MSFWs would be improved 
through other staffing arrangements.
    (j) For purposes of this subpart, an outreach ``contact'' shall 
include either the presentation of information and offer of assistance 
specified in paragraphs (j)(1) and (j)(2) of this section, or the 
followup activity specified in paragraph (j)(3) of this section.
    (1) Outreach workers shall explain to MSFWs at their working, living 
or gathering areas, including day-haul sites, by means of written and 
oral presentations either spontaneous or recorded, in a language readily 
understood by them, the following;
    (i) The services available from the local office, including the 
availability of referrals to agricultural and nonagricultural 
employment, to training, to supportive services, as well as the 
availability of testing, counseling and other job development services;
    (ii) Types of specific employment opportunities which are currently 
available in the JS system;
    (iii) Information on the JS complaint system and other organizations 
serving MSFWs;
    (iv) A basic summary of farmworker rights with respect to the terms 
and conditions of employment;
    (v) Provided, however, That outreach workers shall not enter work 
areas to perform outreach duties described in this section on an 
employer's property without permission of the employer, unless otherwise 
authorized to enter by

[[Page 447]]

law, shall not enter workers' living areas without the permission of the 
workers, and shall comply with appropriate State laws regarding access.
    (2) After making the presentation, outreach workers shall urge the 
MSFWs to go to the local office to obtain the full range of JS services. 
If an MSFW cannot or does not wish to visit the local JS office, the 
outreach workers shall offer to provide on-site the following:
    (i) Assistance in the preparation of applications;
    (ii) If an unemployed MSFW, assistance in obtaining referral to 
specific employment opportunities currently available; if an employed 
MSFW, information regarding the types of employment opportunities which 
will become available upon the date on which the MSFW indicates that he/
she will be available following his/her current employment.
    (iii) Assistance in the preparation of either JS or non-JS related 
complaints;
    (iv) Receipt and subsequent referral of complaints to the local 
office complaint specialist or local officer manager;
    (v) Referral to supportive services for which the individual or a 
family member may be eligible;
    (vi) As needed, assistance in making appointments and arranging 
transportation for individual MSFWs or members of their family to and 
from local offices or other appropriate agencies.
    (3) Outreach workers shall make follow-up contacts as are necessary 
and appropriate to provide to the maximum extent possible the assistance 
specified in paragraphs (j)(1) and (j)(2) of this section.
    (4) In addition to the foregoing outreach contacts, the State agency 
shall publicize the availability of JS services through such means as 
newspaper and electronic media publicity. Contacts with public and 
priviate community agencies, employers and/or employer organizations, 
and MSFW groups also shall be utilized to facilitate the widest possible 
distribution of information concerning JS services.
    (k) Outreach workers shall be alert to observe the working and 
living conditions of MSFWs and, upon observation, or upon receipt of 
information regarding a suspected violation of federal or State 
employment-related law, document and refer information to the local 
office manager for processing in accordance withSec. 653.113.
    (l) Outreach workers shall be trained in local office procedures and 
in the services, benefits, and protections afforded MSFWs by the JS. 
They shall also be trained in the procedure for informal resolution of 
complaints. The program for such training shall be formulated by the 
State Administrator, pursuant to uniform guidelines developed by ETA, 
and each State's program shall be reviewed and commented upon in advance 
by the State MSFW Monitor Advocate.
    (m) During months when outreach activities are conducted, outreach 
workers shall maintain complete records of their contacts with MSFWs and 
the services they perform in accordance with a format developed by ETA. 
These records shall include a daily log, a copy of which shall be sent 
monthly to the local office manager and maintained on file for at least 
two years. These records shall include the number of contacts and names 
of contacts (where applicable), the services provided (e.g., whether a 
complaint was received, whether an application was taken, and whether a 
referral was made). Outreach workers also shall maintain records of each 
possible violation or complaint of which they have knowledge, and their 
actions in ascertaining the facts and referring the matters as provided 
herein. These records shall include a description of the circumstances 
and names of any employers who have refused outreach workers access to 
MSFWs pursuant toSec. 653.107(l).
    (n) During months when outreach activities are conducted, each local 
office manager shall file with the State MSFW Monitor Advocate a monthly 
summary report of outreach efforts. These reports shall summarize 
information collected, pursuant to paragraph (m) of this section. The 
local office manager and/or other appropriate State office staff members 
shall assess the performance of outreach workers by examining the 
overall quality and productivity of their work, including

[[Page 448]]

the services provided and the methods and tools used to offer services. 
Performance shall not be judged solely by the number of contacts made by 
the worker. The monthly reports and daily outreach logs shall be made 
available to the State MSFW Monitor Advocate and federal On-Site Review 
Teams. In addition, the distribution of any special funds for outreach, 
should funds become available, shall be based on the effectiveness and 
need of the State's outreach program as monitored by ETA.
    (o) Outreach workers shall not engage in political, unionization or 
antiunionization activities during the performance of their duties.
    (p) Outreach workers shall be provided with, carry and display, upon 
request, identification cards or other material identifying them as 
employees of the State agency.

(Approved by the Office of Management and Budget under control number 
1205-0039)

(Pub. L. No. 96-511, 94 Stat. 2812 (44 U.S.C. 3501 et seq.))

[45 FR 39459, June 10, 1980, as amended at 47 FR 145, Jan. 5, 1982; 71 
FR 35518, June 21, 2006]



Sec.  653.108  State agency self-monitoring.

    (a) State Administrators shall assure that their State agencies 
monitor their own compliance with JS regulations in serving MSFWs on an 
ongoing basis. The State Administrator shall have overall responsibility 
for State agency self-monitoring.
    (b) The State Administrator shall appoint a State MSFW Monitor 
Advocate. The State Administrator shall inform farmworker organizations 
and other organizations with expertise concerning MSFWs of the opening 
and encourage them to refer qualified applicants to apply through the 
State merit system prior to appointing a State MSFW Monitor Advocate. 
Among qualified candidates determined through State merit system 
procedures, the State agencies shall seek persons (1) who are from MSFW 
backgrounds, or (2) who speak Spanish or other languages of a 
significant proportion of the State MSFW population, or (3) who are 
racially or ethnically similar to the MSFWs in the State, or (4) who 
have substantial work experience in farmworker activities.
    (c) The State MSFW Monitor Advocate shall have direct, personal 
access, whenever he/she finds it necessary, to the State Administrator 
and shall work in the State central office. The State MSFW Monitor 
Advocate shall have status and compensation as approved by the civil 
service classification system and be comparable to other State positions 
assigned similar levels of tasks, complexity and responsibility.
    (d) The State MSFW Monitor Advocates shall be assigned staff 
necessary to fulfill effectively all of his/her duties as set forth in 
this subpart. The number of staff positions shall be determined by 
reference to:
    (1) The number of MSFWs in the State, as measured at the time of the 
peak MSFW population (MSFW activity), and (2) the need for monitoring 
activity in the State. The MSFW Monitor Advocates shall devote full time 
to Monitor Advocate functions, except that the OWI Administrator may 
reallocate positions from States of low MSFW activity to States of 
higher MSFW activity and may approve a plan for less than full-time work 
in States of low MSFW activity. Any such plan must demonstrate that the 
State MSFW Monitor Advocate function can be effectively performed with 
part-time staffing.
    (e) All State MSFW Monitor Advocates and Assistant MSFW Monitor 
Advocates shall attend within the first three months of their tenure a 
training session conducted by the Regional MSFW Monitor Advocate. They 
shall also attend whatever additional training sessions are required by 
the Regional or National MSFW Monitor Advocate.
    (f) The State MSFW Monitor Advocate shall provide any relevant 
documentation requested from the State agency by the Regional MSFW 
Monitor Advocate.
    (g) The State MSFW Monitor Advocate shall:
    (1) Conduct an ongoing review of the delivery of services and 
protections afforded by JS regulations to MSFWs by the State agency and 
local offices. The

[[Page 449]]

State MSFW Monitor Advocate, without delay, shall advise the State 
agency and local offices of (i) problems, deficiencies, or improper 
practices in the delivery of services and protections afforded by these 
regulations (including progress made in achieving affirmative action 
goals and timetables), and (ii) means to improve such delivery.
    (2) Participate in onsite local office MSFW formal monitoring 
reviews on a regular basis.
    (3) Assure that all significant MSFW local offices not reviewed 
onsite by Federal staff, are reviewed at least once a year by State 
staff, and that, if necessary, those local offices in which significant 
problems are revealed by required reports, management information, the 
JS complaint system or otherwise are reviewed as soon as possible.
    (4) Assure that the monitoring review format, developed by ETA, is 
used as a guideline in the conduct of local office MSFW onsite formal 
monitoring reviews. This format will ensure that applications and the 
application-taking process are reviewed during State onsite reviews by 
State MSFW Monitor Advocates and/or review staff, who shall check 
overall accuracy and quality, and offer technical advice on corrections 
or improvements.
    (5) Review the State agency's outreach plan, and on a random basis, 
the outreach workers' daily logs and other reports including those 
showing or reflecting the workers' activities, to ensure that they 
comply with the outreach plan.
    (h) Formal onsite MSFW monitoring reviews of local offices shall be 
conducted using the following procedures:
    (1) Before beginning such a review, the State MSFW Monitor Advocate 
and/or review staff shall study:
    (i) Program performance data,
    (ii) Reports of previous reviews,
    (iii) Corrective action plans developed as a result of previous 
reviews,
    (iv) Complaint logs, and
    (v) Complaints elevated from the office or concerning the office.
    (2) Upon completion of a local office onsite formal monitoring 
review, the State MSFW Monitor Advocate shall hold one or more wrap-up 
sessions with the local office manager and staff to discuss any obvious 
findings and offer initial recommendations and appropriate technical 
assistance.
    (3) After each review the State MSFW Monitor Advocate shall conduct 
an indepth analysis of the review data. The conclusions and 
recommendations of the State MSFW Monitor Advocate shall be put in 
writing, shall be sent to the State Administrator, to the offical of the 
State agency with line authority over the local office, and other 
appropriate State agency officials.
    (4) The state MSFW Monitor Advocate may recommend that the review 
responsibility set forth in this subsection be delegated to a 
responsible professional member of the administrative staff of the State 
agency, if and when the State Administrator finds such delegation 
necessary. In such event, the State MSFW Monitor Advocate shall be 
responsible for and shall approve the written report of the review.
    (5) The local office manager shall develop and propose a written 
corrective action plan. The plan shall be approved, or appropriately 
revised, by appropriate superior officials and the State MSFW Monitor 
Advocate. The plan shall include actions required to correct or to take 
major steps to correct any problems within 30 days or if the plan allows 
for more than 30 days for full compliance, the length of, and the 
reasons for, the extended period shall be specifically stated.
    (6) State agencies, through line supervisory staff, shall be 
responsible for assuring and documenting that the local office is in 
compliance within the time period designated in the plan. State agencies 
shall submit to the appropriate ETA regional offices copies of the 
onsite local office formal monitoring review reports and corrective 
action plans for significant local offices.
    (i) The State MSFW Monitor Advocate shall participate in federal 
reviews conducted pursuant to subpart G.
    (j) At the discretion of the State Administrator, the State MSFW 
Monitor Advocate may be assigned the responsibility as the complaint 
specialist. The State MSFW Monitor Advocate shall participate in and 
monitor the performance of the complaint system, as set forth at 20 CFR 
658.400 et seq. The

[[Page 450]]

State MSFW Monitor Advocate shall review the local office managers' 
informal resolution of complaints relating to MSFWs and shall ensure 
that the State agency transmits copies of the logs of MSFW complaints to 
the regional office quarterly.
    (k) The State MSFW Monitor Advocate also shall serve as an advocate 
to improve services for MSFWs within JS. The State MSFW Monitor Advocate 
shall establish ongoing liaison with WIA 167 National Farmworker Jobs 
Program and other organizations serving farmworkers, and employers and/
or employer organizations, in the State. The State MSFW Monitor Advocate 
shall meet frequently with representatives of these organizations to 
receive complaints, assist in referrals of alleged violations to 
enforcement agencies, receive input on improving coordination with JS or 
improving JS services to MSFWs.
    (l) The State MSFW Monitor Advocate shall conduct frequent field 
visits to the working and living areas of MSFWs, and shall discuss JS 
services and other employment-related programs with MSFWs, crew leaders, 
and employers. Records shall be kept of each such visit.
    (m) The State MSFW Monitor Advocate shall participate in the 
appropriate regional public meeting(s) held by the Department of Labor 
Regional Farm Labor Coordinated Enforcement Committee.
    (n) The State MSFW Monitor Advocate shall ensure that outreach 
efforts in all significant MSFW local offices are reviewed at least 
yearly to ensure that there is continuing compliance with 20 CFR 
653.107. This review will include accompanying at least one outreach 
worker from each significant MSFW local office on his/her visits to 
MSFWs' working and living areas. The State MSFW Monitor Advocate shall 
review findings from these reviews.
    (o) The State MSFW Monitor Advocate shall review and assess the 
adequacy of the annual State affirmative action plan for MSFWs, and 
shall report such findings to the State Administrator.
    (p) The State MSFW Monitor Advocate shall ensure that JS outreach 
activities are reviewed periodically at day-haul sites at which these 
activities are conducted. Complete records of such visits shall be kept. 
The State MSFW Monitor Advocate shall ensure that local offices and the 
State Administrator are advised of any deficiencies.
    (q) The State MSFW Monitor Advocate shall review on at least a 
quarterly basis all statistical and other MSFW-related data reported by 
significant MSFW local offices in order (1) to determine the extent to 
which the State agency has complied with regulations atSec. 653.100 et 
seq., and (2) to identify the areas of inadequate compliance.
    (r) The State MSFW Monitor Advocate shall have full access to all 
statistical and other MSFW-related information gathered by State 
agencies and local offices and may interview State and local office 
staffs with respect to reporting methods. Subsequent to each review, the 
State MSFW Monitor Advocate shall consult, as necessary, with State and 
local offices and provide technical assistance to ensure accurate 
reporting.
    (s) The State MSFW Monitor Advocate shall review and comment on 
proposed State JS directives, manuals, and operating instructions 
relating to MSFWs and shall ensure (1) that they accurately reflect the 
requirements of the regulations, and (2) that they are clear and 
workable. The State MSFW Monitor Advocate also shall explain and make 
available at the requestor's cost, pertinent directives and procedures 
to employers, employer organizations, farmworkers, farmworker 
organizations and other parties expressing an interest in a readily 
identifiable directive or procedure issued and receive suggestions on 
how these documents can be improved.
    (t) The State MSFW Monitor Advocate shall prepare for the State 
Administrator an annual summary of JS services to MSFWs within his/her 
State based on statistical data and his/her reviews and activities set 
forth in these regulations. The summary shall include an assessment of 
the State agency's activities related to MSFWs such as those covered in 
the State agency's PBP, outreach plan, and affirmative action plan, and 
the other matters with respect to which the State MSFW

[[Page 451]]

Monitor Advocate has responsibilities under these regulations. A copy of 
this summary shall be forwarded to the Regional Administrator by the 
State Administrator.

(Approved by the Office of Management and Budget under control number 
1205-0039)

(Pub. L. No. 96-511, 94 Stat. 2812 (44 U.S.C. 3501 et seq.))

[45 FR 39459, June 10, 1980, as amended at 47 FR 145, Jan. 5, 1982; 71 
FR 35518, June 21, 2006]



Sec.  653.109  Data collection.

    State agencies shall: (a) Collect data on MSFWs, including data on 
the number (1) contacted through outreach activities, (2) registering 
for service, (3) referred to agricultural jobs, (4) referred to non-
agricultural jobs, (5) placed in agricultural jobs, (6) placed in non-
agricultural jobs, (7) referred to training, (8) receiving counseling, 
(9) receiving job development, (10) receiving testing, (11) referred to 
supportive service, (12) receiving some service, (13) placed according 
to wage rates, and (14) placed according to duration. The State agencies 
also shall collect data on agricultural clearance orders (including 
field checks), MSFW complaints, and monitoring activities, as directed 
by ETA. These data shall be collected in accordance with applicable ETA 
Reports and Guidance Letters.
    (b) Collect data on the number of MSFWs who were served as to 
whether they were male, female, black, Hispanic, American Indian, Asian, 
or Pacific Islander.
    (c) Provide necessary training to State agency, including local 
office personnel, to assure accurate reporting of data;
    (d) Collect and submit to ETA as directed by ETA, data on MSFWs 
required by the PBP, and
    (e) Periodically collect and verify data required under this 
subsection, take necessary steps to ensure its validity, and collect and 
submit data for verification to ETA, as directed by ETA; and
    (f) Submit additional reports to the ETA at such times and 
containing such items as ETA directs.

(Approved by the Office of Management and Budget under control number 
1205-0039)

(Pub. L. No. 96-511, 94 Stat. 2812 (44 U.S.C. 3501 et seq.))

[45 FR 39459, June 10, 1980, as amended at 47 FR 145, Jan. 5, 1982; 71 
FR 35518, June 21, 2006]



Sec.  653.110  Disclosure of data.

    (a) State agencies shall disclose to the public, on written request, 
in conformance with applicable State and Federal law, the data collected 
by State and local offices pursuant toSec. 653.109, if possible within 
10 working days after receipt of the request.
    (b) If a request for data held by a State agency is made to the ETA 
national or regional office, the ETA shall forward the request to the 
State agency for response.
    (c) If the requested data cannot be supplied within 10 working days 
of receipt by the State agency of the request, the State agency shall 
respond to the requestor in writing, giving the reason for the delay and 
specifying the date by which it expects to be able to comply.
    (d) State agency intra-agency memoranda and reports (or parts 
thereof) and memoranda and reports (or parts thereof) between the State 
agency and the ETA, however, to the extent that they contain statements 
of opinion rather than facts, may be withheld from public disclosure 
provided this reason for withholding is given to the requestor in 
writing. Similarly, documents or parts thereof, which, if disclosed, 
would constitute an unwarranted invasion of personal or employer 
privacy, may also be withheld provided the reason is given to the 
requestor in writing.



Sec.  653.111  State agency staffing requirements.

    (a) On a statewide basis, staff representative of the racial and 
ethnic characteristics in the work force shall be distributed in 
substantially the same proportion among (1) all ``job groups'' (as that 
term is defined by the Office of Federal Contract Compliance

[[Page 452]]

Programs), and (2) all offices in the plan(s).
    (b)(1) As part of the PBP, each State agency shall develop and 
submit to the Regional Administrator affirmative action plans for all 
significant local offices within its jurisdiction (which, for the 
purposes of this provision, means those local offices representing the 
top 20 per cent of MSFW activity nationally). These affirmative action 
plans shall include goals and timetables and shall ensure that 
sufficient numbers of qualified, permanent minority staff are hired. 
Where qualified minority applicants are not available to be hired as 
permanent staff, qualified minority part-time, provisional, or temporary 
staff shall be hired in accordance with State merit system procedures, 
where applicable. These affirmative action plans shall be prepared on an 
individual office basis.
    (2) The affirmative action plans shall include an analysis of the 
racial and ethnic characteristics of the work force in the local office 
service area. To determine the ``work force'' for the purpose of this 
paragraph, the State agency shall include the racial and ethnic 
characteristics of any MSFW population which is not a part of the 
permanent work force by computing an estimate of the total work years 
MSFWs collectively spend in the area and including a number of workers 
equivalent to this estimate as part of the permanent work force. This 
computation shall be made by calculating the average length of time, as 
a fractional part of a year, MSFWs stay in the area and then multiplying 
this figure by the total estimated MSFW population in the area during 
the previous year.
    (3) The affirmative action plan also shall include an analysis of 
the local office staffing characteristics. The plan shall provide a 
comparison between the characteristics of the staff and the work force 
and determine if the composition of the local office staff(s) is 
representative of the racial and ethnic characteristics of the work 
force in the local office service area(s).
    (4) If the staff under-represents any of these characteristics, the 
State agency shall establish a staffing goal at a level equivalent to 
the percentage of the characteristics in the work force in the local 
office service areas. The State agency also shall establish a reasonable 
timetable for achieving the staffing goal by hiring or promoting 
available, qualified staff in the under-represented categories. In 
establishing timetables, the State agency shall consider the vacancies 
anticipated through expansion, contraction, and turnover in the 
office(s) and available funds, and all affirmative action plans shall 
establish timetables that are designed to achieve the staffing goal no 
later than December 31, 1983.
    (c) In addition, each State agency which has significant local 
offices, shall undertake special efforts to recruit MSFWs and persons 
from MSFW back-grounds for its staff, shall document achievements, and 
shall include in the affirmative action plan(s) a complete description 
of specific actions which the agency will take and time frames within 
which these actions will be taken.
    (d) In developing the affirmative action plan for significant local 
offices, the State agency shall solicit from WIA 167 National Farmworker 
Jobs Program and other appropriate MSFW groups, employer organizations 
and other interested organizations, estimates of the total MSFW 
population in each local office service area, and the average length of 
time the MSFWs stay in the area. In addition, State agencies shall 
solicit, consider, incorporate as appropriate, respond to and include 
copies of comments from WIA 167 National Farmworker Jobs Program, other 
appropriate MSFW groups, employer organizations, and other interested 
organizations, following procedures set forth for the annual outreach 
plan atSec. 653.107(d).
    (e) As part of the annual Program and Budget Plan (PBP) process, the 
funding of State agencies which are required to develop and implement 
affirmative action plans for significant local offices shall be 
contingent upon the timely submittal of adequate affirmative action 
plans and the substantial and timely attainment of the goals and 
timetables contained in those plans. However, if the Regional 
Administrator makes a finding of good faith efforts, he/she may fund a 
State agency

[[Page 453]]

even though it did not achieve substantial and timely compliance.
    (f) All State Workforce Agencies (SWAs) required to develop 
affirmative action plans for significant local offices shall keep 
accurate records of their employment practices for those offices, 
including information on all applications. These records shall be 
maintained in accordance with the recordkeeping requirements concerning 
affirmative action which are established by ETA and distributed to the 
SWAs. All records shall be made available to the State MSFW Monitor 
Advocate, EEO staff and Federal On-Site Review Teams.
    (g) Affirmative action plans shall contain a description of specific 
steps to be taken for the adequate recruitment of MSFWs for all vacant 
positions in significant local offices and the central office. These 
steps shall include advertisements in newspapers, radio or other media, 
in a manner calculated to best reach the MSFW population, and contacts 
by outreach workers and the State MSFW Monitor Advocate with groups 
serving the MSFW population.
    (h) State EEO staff shall have the responsibility for developing 
affirmative action plans. The State MSFW Monitor Advocate(s) shall 
comment on the plan to the State Administrator. Upon submission of the 
affirmative action plan as part of the State agency's PBP submittal, the 
Regional MSFW Monitor Advocate shall review the affirmative action 
plan(s) as it pertains to MSFWs and comment to the Regional 
Administrator. As part of his/her regular reviews of State agency 
compliance, the Regional MSFW Monitor Advocate shall monitor the extent 
to which the State has complied with its affirmative action plan(s) as 
it pertains to MSFWs. The Regional MSFW Monitor Advocate's finding as to 
the adequacy of the plan(s) and as to the State's compliance with the 
plan(s) shall be considered in PBP decisions involving future funding of 
the State agency.

(Approved by the Office of Management and Budget under control number 
1205-0039)

(Pub. L. No. 96-511, 94 Stat. 2812 (44 U.S.C. 3501 et seq.))

[45 FR 39459, June 10, 1980, as amended at 47 FR 145, Jan. 5, 1982; 71 
FR 35518, June 21, 2006]



Sec.  653.112  State agency program budget plans.

    (a) Each State agency, in its annual program budget plan, shall 
describe its plan to carry out the requirements of this subpart in the 
following year. The plan shall include, where applicable, the outreach 
and affirmative action plans required by Sec.Sec. 653.107 and 653.111, 
respectively. For significant MSFW States, ETA shall establish program 
performance indicators reflecting equity indicators and indicators 
measuring minimum levels of service to MSFWs which the significant MSFW 
State agencies will be required to meet. These program performance 
indicator requirements shall be contained in the PBP Guidelines which 
ETA promulgates on an annual basis.
    (b) Equity indicators shall address JS controllable services and 
shall include, at a minimum, individuals referred to a job; receiving 
counselling; receiving job development; receiving some service; and 
referred to supportive service.
    (c) Minimum level of service indicators shall address other services 
to MSFWs and shall include, at a minimum, individuals placed in a job; 
placed in a job with a wage exceeding the Federal minimum wage by at 
least 50 cents/hour; placed long-term (150 days or more) in a non-
agricultural job; review of significant MSFW local offices; field checks 
on agricultural clearance orders; outreach contacts per staff day; and 
processing of complaints. The determination of the minimum service 
levels required of significant MSFW States for each year shall be based 
on the following:
    (1) Past State agency performance in serving MSFWs, as reflected in 
on-site reviews and data collected underSec. 653.109;
    (2) The need for services to MSFWs in the following year, comparing 
prior and projected levels of MSFW activity;

[[Page 454]]

    (3) The ETA program priorities for the following year; and
    (4) Special circumstances and external factors existing in the 
particular State.
    (d) The Regional Administrator shall review this portion of the PBP, 
and approve it upon making a written determination that it is acceptable 
in light of the requirements of this subpart. The Regional 
Administrator's written determination shall be available to the public 
upon request.

(Approved by the Office of Management and Budget under control number 
1205-0039)

(Pub. L. No. 96-511, 94 Stat. 2812 (44 U.S.C. 3501 et seq.))

[45 FR 39459, June 10, 1980, as amended at 47 FR 145, Jan. 5, 1982]



Sec.  653.113  Processing apparent violations.

    (a) If a State agency employee observes, has reason to believe, or 
is in receipt of information regarding a suspected violation of 
employment related laws or JS regulations by an employer, except as 
provided atSec. 653.503 (field checks) orSec. 658.400 of this 
chapter (complaints), the employee shall document the suspected 
violation and refer this information to the local office manager.
    (b) If the employer has filed a job order with the JS office within 
the past 12 months, the local office shall attempt informal resolution. 
If the employer does not remedy the suspected violation within 5 working 
days, procedures at part 658, subpart F of this chapter shall be 
initiated and, if a violation of an employment related law is involved, 
the violation shall be referred to the appropriate enforcement agency in 
writing.
    (c) If the employer has not filed a job order with the local office 
during the past 12 months, the suspected violation of an employment 
related law shall be referred to the appropriate enforcement agency in 
writing.

Subpart C--Services for Veterans [Reserved]

Subpart D--Services to the Handicapped [Reserved]

Subpart E--Support Services [Reserved]



             Subpart F_Agricultural Clearance Order Activity

    Source: 45 FR 39466, June 10, 1980, unless otherwise noted.



Sec.  653.500  Purpose and scope of subpart.

    This section contains the requirements for acceptance and handling 
of intrastate and interstate job clearance orders seeking workers to 
perform agricultural or food processing work on a less than year round 
basis. Orders seeking workers to perform agricultural or food processing 
work on a year round basis which involves permanent relocation are not 
subject to the requirements of this subpart. This section, therefore, 
contains requirements which affect not only applicants who are 
categorized as MSFWs based on their past employment, but all workers who 
are recruited through the JS intrastate and interstate clearance systems 
for less than year round agricultural or food processing work.



Sec.  653.501  Requirements for accepting and processing clearance 
orders.

    (a) In view of the statutorily established basic function of the job 
service as a no-fee labor exchange, that is, as a forum for bringing 
together employers and job seekers, neither the ETA nor the State 
agencies are guarantors of the accuracy or truthfulness of information 
contained on job orders submitted by employers. Nor does any job order 
accepted or recruited upon by the JS constitute a contractual job offer 
to which the ETA or a State agency is in any way a party. Nevertheless, 
if the ETA or a State agency discovers that an employer's job order 
contains a material misrepresentation, the procedures of subpart F of 
part 658 of this chapter shall be followed.
    (b) Intrastate and interstate job orders shall include the language 
of the first two sentences of paragraph (a) of this section.
    (c) No local office or State agency shall place into intrastate or 
interstate

[[Page 455]]

clearance any job order seeking workers to perform agricultural or food 
processing work before reviewing it pursuant to paragraphs (d) or (e) of 
this section, as applicable.
    (d) No local office shall place a job order seeking workers to 
perform agricultural or food processing work into intrastate clearance 
unless:
    (1) The job order does not contain an unlawful discriminatory 
specification by race, color, religion, national origin, age, sex, or 
mental or physical status unrelated to job performance (handicap);
    (2) The employer has signed the job order and the job order states 
all the material terms and conditions of the employment, including:
    (i) The crop;
    (ii) The nature of the work;
    (iii) The anticipated period and hours of employment;
    (iv) The anticipated starting and ending date of employment and the 
anticipated number of days and hours per week for which work will be 
available;
    (v) An assurance that:
    (A) The employer will provide to workers referred through the 
clearance system the number of hours of work cited in paragraph 
(d)(2)(iv) of this section for the week beginning with the anticipated 
date of need, unless the employer has amended the date of need at least 
10 working days prior to the original date of need (pursuant to 
paragraph (d)(2)(xiii) of this section) by so notifying the order-
holding office. The State agency shall make a record of this 
notification and shall attempt to inform referred migrant workers of the 
change in accordance with the following procedure:
    (B) All workers referred through the clearance system, farm labor 
contractors on behalf of migrant workers or family heads on behalf of 
migrant family members referred through the clearance system shall be 
notified to contact a local job service office, preferably the order-
holding office, to verify the date of need cited no sooner than 9 
working days and no later than 5 working days prior to the original date 
of need cited on the job order; and that failure to do so will 
disqualify the referred migrant worker from the assurance provided in 
paragraphs (a) and (d) of this section.
    (C) If the worker referred through the clearance system contacts a 
local office (in any State) other than the order holding office, that 
local office shall assist the referred worker in contacting the order 
holding office on a timely basis. Such assistance shall include, if 
necessary, contacting the order holding office by telephone or other 
timely means on behalf of the worker referred through the clearance 
system.
    (D) If the employer fails to notify the order-holding office at 
least 10 working days prior to the original date of need the employer 
shall pay eligible (pursuant to paragraph (b) of this section) workers 
referred through the clearance system the specified hourly rate of pay, 
or in the absence of a specified hourly rate of pay, the higher of the 
Federal or State minimum wage for the first week starting with the 
originally anticipated date of need.
    (E) Employers may require workers to perform alternative work if the 
guarantee in this section is invoked and if such alternative work is 
stated on the job order.
    (F) For the purposes of this assurance, ``working days'' shall mean 
those days that the order-holding local office is open for public 
business.
    (vi) The hourly wage rate or the piece rate estimated in hourly wage 
rate equivalents for each activity and unit size;
    (vii) Any deductions to be made from wages;
    (viii) A specification of any non-monetary benefits to be provided 
by the employer;
    (ix) Any hours, days or weeks for which work is guaranteed, and, for 
each guaranteed week of work except as provided in paragraph (d)(2)(v) 
of this section, the exclusive manner in which the grarantee may be 
abated due to weather conditions or other acts of God beyond the 
employer's control;
    (x) Any bonus or work incentive payments or other expenses which 
will be paid by the employer in addition to the basic wage rate, 
including the anticipated time period(s) within which such

[[Page 456]]

payments will be made. No such payments, however, shall be made 
contingent upon the worker continuing employment beyond the period of 
employment specified in the job order or, in the case of any worker with 
children, beyond the time needed to return home for the beginning of the 
school year;
    (xi) An assurance that no extension of employment beyond the period 
of employment specified in the job order shall relieve the employer from 
paying the wages already earned, or if specified in the job order as a 
term of employment, providing transportation or paying transportation 
expenses to the worker's home;
    (xii) Assurances that the working conditions comply with applicable 
Federal and State minimum wage, child labor, social security, health and 
safety, farm labor contractor registration and other employment-related 
laws;
    (xiii) An assurance that the employer will expeditiously notify the 
order-holding local office or State agency by telephone immediately upon 
learning that a crop is maturing earlier or later, or that weather 
conditions, over-recruitment or other factors have changed the terms and 
conditions of employment. For orders submitted in conjunction with 
requests for foreign workers, an assurance that the employer will 
follow-up the telephone notification in writing.
    (xiv) An assurance that the employer, if acting as a farm labor 
contractor (``FLC'') or farm labor contractor employee (``FLCE'') on the 
order, has a valid FLC certificate or FLCE identification card; and
    (xv) An assurance of the availability of no cost or public housing 
which meets the Federal standards and which is sufficient to house the 
specified number of workers requested through the clearance system. This 
assurance shall cover the availability of housing for only those 
workers, and, when applicable, family members who are unable to return 
to their residence in the same day.
    (xvi) An assurance that outreach workers shall have reasonable 
access to the workers in the conduct of outreach activities pursuant to 
Sec.  653.107.
    (3) The job order contains all the material terms and conditions of 
the job, and the employer assures that all items therein are actual 
conditions of the job by signing the following statement: ``This job 
order describes the actual terms and conditions of the employment being 
offered by me and contains all the material terms and conditions of the 
job'';
    (4) The wages and working conditions offered are not less than the 
prevailing wages and working conditions among similarly employed 
agricultural workers in the area of intended employment or the 
applicable Federal or State minimum wage, whichever is higher. If the 
wages offered are expressed as piece rates or as base rates and bonuses, 
the employer shall make the method of calculating the wage and 
supporting materials available to JS staff who shall check if the 
employer's calculation of the estimated hourly wage rate is reasonably 
accurate and is not less than the prevailing wage rate or applicable 
Federal or State minimum wage, whichever is higher;
    (5) The employer has agreed to provide or pay for the transportation 
of the workers and their families on at least the same terms as 
transportation is commonly provided by employers in the area of intended 
employment to agricultural workers and their families recruited from the 
same area of supply;
    (6) JS staff have determined, through a preoccupancy housing 
inspection performed by JS staff or other appropriate public agencies, 
that the housing assured by the employer is in fact available, and meets 
the full set of standards set forth at 20 CFR part 654, subpart E which 
details applicable housing standards and contains provisions for 
conditional access to the clearance system; except that mobile range 
housing for sheepherders shall meet existing Departmental guidelines; 
and
    (7) The local office and employer have attempted and have not been 
able to obtain sufficient workers within the local labor market area, or 
the local office anticipates a shortage of local workers.
    (e) No state agency shall place a job order seeking workers to 
perform agricultural or food processing work with interstate clearance 
unless:

[[Page 457]]

    (1) The job order meets the requirements set forth at paragraphs 
(d)(1) through (d)(6) of this section;
    (2) The State agency and the employer have attempted and have not 
been able to locate sufficient workers within the state, or the State 
agency anticipates a shortage of workers within the State; and
    (3) The order has been reviewed and approved by the ETA regional 
office within 10 working days after receipt from the State agency, and 
the Regional Administrator has approved the areas of supply to which the 
order shall be extended. Any denial by the Regional Administrator shall 
be in writing and set forth the reasons for the denial.
    (f)(1) The local office shall use the agricultural clearance form 
prescribed by ETA, and shall see that all necessary items on the form 
are completed, including items on attachments to the form prescribed by 
ETA.
    (2)(i) The original of an interstate agricultural clearance form 
shall be retained for the order-holding local office files. If the 
clearance order is submitted in conjunction with a request for 
certification of temporary alien agricultural workers, the procedures at 
20 CFR 655.204(a) shall be followed. For other clearance orders, the 
order-holding local office shall transmit a complete copy to the State 
office. The State office shall distribute additional copies of the form 
with all attachments except that the State agency may, at its 
discretion, delegate this distribution to the local office, as follows:
    (A) At least one clear copy to each of the State agencies selected 
for recruitment (areas of supply);
    (B) One copy to each applicant-holding ETA regional office;
    (C) One copy to the order-holding ETA regional office; and
    (D) One copy to the Regional Farm Labor Coordinated Enforcement 
Committee in the area of employment, Attn: ESA Regional Administrator.
    (ii) Applicant-holding offices shall provide workers referred on 
clearance orders with a checklist summarizing wages, working conditions 
and other material specifications on the job order. Such checklists, 
where necessary, shall be in English and Spanish. The checklist shall 
include language notifying the worker that a copy of the complete order 
is available for inspection. One copy of the form with all attachments 
shall be available for inspection in the applicant-holding office and 
the order-holding office. State agencies shall use a standard checklist 
format provided by ETA unless a variance has been approved by the 
Regional Administrator.
    (iii) The applicant-holding office shall give each referred worker a 
copy of a description of worker's rights developed by the National Farm 
Labor Coordinated Enforcement Committee.
    (g) The local office may place an intrastate or interstate order 
seeking workers to perform agricultural or food processing work for a 
specific farm labor contractor or worker preferred by the employer 
provided the order meets JS nondiscrimination criteria. The order would 
not meet such criteria, for example, if it requested a ``white male crew 
leader'' or ``any white male crew leader.''
    (h) In local offices which have been designated significant MSFW 
bilingual offices by ETA, and in any other local office with bilingual 
staff, bilingual (English-Spanish) staff shall assist all agricultural 
workers, upon request, to understand the terms and conditions of 
employment set forth in intrastate and interstate job orders and shall 
provide such workers with checklists in Spanish showing wage payment 
schedules, working conditions and other material specifications of the 
job order.
    (i) No agricultural or food processing order shall be included in 
job bank listings available outside the local office commuting area 
unless the order has been processed according to requirements for 
intrastate or interstate clearance contained in this subpart. If the job 
bank for the local office area incorporates offices beyond the local 
office commuting area, the order may be included in the listing but must 
be clearly designated as prohibiting referral from outside the community 
area, unless the requirements of this subpart are met.
    (j) If the labor supply State agency accepts a clearance order, the 
State agency shall actively recruit workers for referral. In the event a 
potential

[[Page 458]]

labor supply State agency rejects a clearance order, the reasons for 
rejection shall be documented and submitted to the Regional 
Administrator having jurisdiction over the State agency. The Regional 
Administrator will examine the reasons for rejection, and, if the 
Regional Administrator agrees, will inform the Regional Administrator 
with jurisdiction over the order-holding State agency of the rejection 
and the justifiable reasons. If the Regional Administrator who receives 
the notification of rejection does not concur with the reasons for 
rejection, that Regional Administrator will so inform the OWI 
Administrator, who will make a final determination on the acceptance or 
rejection of the order.

(Approved by the Office of Management and Budget under control number 
1205-0039)

(Pub. L. No. 96-511, 94 Stat. 2812 (44 U.S.C. 3501 et seq.))

[45 FR 39466, June 10, 1980, as amended at 47 FR 145, Jan. 5, 1982; 71 
FR 35518, June 21, 2006]



Sec.  653.502  Changes in crop and recruitment situations.

    (a) If a labor demand State agency learns that a crop is maturing 
earlier than expected or that other material factors, including weather 
conditions and recruitment levels, have changed, the agency shall 
immediately contact the labor supply State agency, who shall in turn 
immediately inform crews and families scheduled through the JS clearance 
system of the changed circumstances and adjust arrangements on behalf of 
such crews of families.
    (b) When there is a delay in the date of need, procedures required 
of employers and workers atSec. 653.501(d)(2)(v) shall be followed. 
State agencies shall document notifications by employers and contacts by 
individual migrant workers or crew leaders on behalf of migrant workers 
or family heads on behalf of migrant family members to verify the date 
of need.
    (c) In addition, if weather conditions, overrecruitment or other 
conditions have eliminated the scheduled job opportunities, the State 
agencies involved shall make every effort to place the workers in 
alternate job opportunities as soon as possible, especially if the 
worker(s) is already enroute or at the job site. JS staff shall keep 
records of actions under this section.



Sec.  653.503  Field checks.

    (a) The State agency, through its local offices or otherwise, shall 
conduct random, unannounced field checks at a significant number of 
agricultural worksites to which JS placements have been made through the 
intrastate or interstate clearance system. These field checks shall 
include visit(s) to the worksite at a time when workers are there. Both 
the employees and the employer shall be consulted, and JS shall 
determine and document whether wages, hours, working and housing 
conditions are as specified in job orders. JS staff shall keep records 
of all field checks. If State agency personnel observe or receive 
information, or otherwise have reason to believe that conditions are not 
as stated on the job order or that an employer is violating an 
employment related law, the State agency shall document the finding and 
attempt informal resolution. If the matter has not been resolved within 
5 working days, the State agency shall follow the procedures set forth 
at subpart F of part 658 of this chapter. Violations of employment 
related laws shall be referred to appropriate enforcement agencies in 
writing.
    (b) State agencies, to the maximum extent possible, shall make 
formal or informal arrangements with appropriate State and Federal 
enforcement agencies pursuant to which such agencies will agree to 
conduct compliance reviews in their areas of enforcement responsibility 
at agricultural worksites where the State agency has placed workers 
through the agricultural clearance system and to inform the State agency 
if violations are found. An enforcement agency compliance review shall 
satisfy the requirement for State agency field checks where all aspects 
of wages, hours, working and housing conditions have been reviewed by 
the enforcement agency reviews. The State agency shall supplement 
enforcement agency efforts with field checks focusing on areas not 
addressed by enforcement agencies. State agencies shall report 
difficulties in making such formal or informal arrangements with State

[[Page 459]]

enforcement agencies as well as deficiencies in State enforcement agency 
activities to the Regional Farm Labor Coordinated Enforcement Committee.

(Approved by the Office of Management and Budget under control number 
1205-0039)

(Pub. L. No. 96-511, 94 Stat. 2812 (44 U.S.C. 3501 et seq.))

[46 FR 39466, June 10, 1980, as amended at 47 FR 145, Jan. 5, 1982]



PART 654_SPECIAL RESPONSIBILITIES OF THE EMPLOYMENT SERVICE SYSTEM--
Table of Contents



         Subpart A_Responsibilities Under Executive Order 12073

Sec.
654.1 Purpose of subpart.
654.3 Description of Executive Order 12073.
654.4 Definitions.
654.5 Classification of labor surplus areas.
654.6 Termination of classification.
654.7 Publication of area classifications.
654.8 Services to firms and individuals in labor surplus areas.
654.9 Filing of complaints.
654.10 Transition provisions.

         Subpart B_Responsibilities Under Executive Order 10582

654.11 Purpose of subpart.
654.12 Description of Executive Order 10582.
654.13 Determination of areas of substantial unemployment.
654.14 Filing of complaints.

Subparts C-D [Reserved]

               Subpart E_Housing for Agricultural Workers

                        Purpose and Applicability

654.400 Scope and purpose.
654.401 Applicability; transitional provisions.
654.402 Variances.
654.403 Conditional access to the intrastate or interstate clearance 
          system.

                            Housing Standards

654.404 Housing site.
654.405 Water supply.
654.406 Excreta and liquid waste disposal.
654.407 Housing.
654.408 Screening.
654.409 Heating.
654.410 Electricity and lighting.
654.411 Toilets.
654.412 Bathing, laundry, and handwashing.
654.413 Cooking and eating facilities.
654.414 Garbage and other refuse.
654.415 Insect and rodent control.
654.416 Sleeping facilities.
654.417 Fire, safety, and first aid.

    Source: 44 FR 1689, Jan. 5, 1979, unless otherwise noted.



         Subpart A_Responsibilities Under Executive Order 12073

    Authority: 41 U.S.C. 10a et seq; 29 U.S.C. 49 et seq; 15 U.S.C. 
644(n); E.O. 12073; 10582, as amended by E.O. 11051 and 12148.



Sec.  654.1  Purpose of subpart.

    This subpart implements the responsibilities of the Secretary of 
Labor in classifying labor surplus areas in accordance with Executive 
Order 12073 (Federal Procurement in Labor Surplus Areas). The Secretary 
of Labor has delegated responsibilities to the Assistant Secretary, 
Employment and Training Administration.

[44 FR 1689, Jan. 5, 1979, as amended at 48 FR 15616, Apr. 12, 1983]



Sec.  654.3  Description of Executive Order 12073.

    Executive Order 12073 requires executive agencies to emphasize 
procurement set-asides in labor surplus areas. The Secretary of Labor is 
responsible under this order for classifying and designating labor 
surplus areas.

[44 FR 1689, Jan. 5, 1979, as amended at 48 FR 15616, Apr. 12, 1983]



Sec.  654.4  Definitions.

    (a) Assistant Secretary shall mean Assistant Secretary for 
Employment and Training, U.S. Department of Labor.
    (b) Civil jurisdiction shall mean:
    (1) Cities of 25,000 or more population on the basis of the most 
recently available Bureau of the Census estimates; or
    (2) Towns and townships in the States of New Jersey, New York, 
Michigan, and Pennsylvania of 25,000 or more population and which 
possess powers and functions similar to cities; or
    (3) All counties, except those counties which contain any of the 
types of political jurisdictions defined in paragraphs (b) (1) and (2) 
of this section; or
    (4) All other counties are defined as ``balance of county'' (i.e., 
total county

[[Page 460]]

less component cities and townships identified in paragraphs (b) (1) and 
(2) of this section); or
    (5) County equivalents which are towns in the States of 
Massachusetts, Rhode Island and Connecticut.
    (c) Labor surplus area shall mean a civil jurisdiction that, in 
accordance with the criteria specified inSec. 654.5, has been 
classified as a labor surplus area.
    (d) Reference period shall mean the two year period ending December 
31 of the year prior to the October 1 annual date of eligibility 
determination.

[44 FR 1689, Jan. 5, 1979, as amended at 44 FR 26071, May 5, 1979; 48 FR 
15616, Apr. 12, 1983; 53 FR 23347, June 21, 1988]



Sec.  654.5  Classification of labor surplus areas.

    (a) Basic criteria. The Assistant Secretary shall classify a civil 
jurisdiction as a labor surplus area whenever, as determined by the 
Bureau of Labor Statistics, the average unemployment rate for all 
civilian workers in the civil jurisdiction for the reference period is 
(1) 120 percent of the national average unemployment rate for civilian 
workers or higher for the reference period as determined by the Bureau 
of Labor Statistics, or (2) 10 percent or higher. No civil jurisdiction 
shall be classified as a labor surplus area if the average unemployment 
rate for all civilian workers for the reference period is less than 6.0 
percent.
    (b) Criteria for exceptional circumstances. The Assistant Secretary, 
upon petition submitted by the appropriate State Workforce Agency, may 
classify a civil jurisdiction, a Metropolitan Statistical Area, or a 
Primary Metropolitan Statistical Area as a labor surplus area whenever 
such an area meets or is expected to meet the unemployment tests 
established underSec. 654.5(a) as a result of exceptional 
circumstances. For purposes of this paragraph ``exceptional 
circumstances'' shall mean catastrophic events, such as natural 
disasters, plant closings, and contract cancellations expected to have a 
long-term impact on labor market area conditions, discounting temporary 
or seasonal factors. For purposes of this paragraph, ``Metropolitan 
Statistical Area'' and ``Primary Metropolitan Statistical Area'' shall 
mean the areas officially defined and designated as such by the Office 
of Management and Budget.

(Approved by OMB under control number 1205-0207)

[48 FR 15616, Apr. 12, 1983, as amended at 53 FR 23347, June 21, 1988; 
71 FR 35518, June 21, 2006]



Sec.  654.6  Termination of classification.

    (a) Basic procedure. The Assistant Secretary shall terminate the 
classification of a civil jurisdiction as a labor surplus area after any 
year in which the Assistant Secretary determines that the criteria 
established underSec. 654.5 (a) are no longer met.
    (b) Procedure for exceptional circumstances. The Assistant Secretary 
shall terminate the classification of a civil jurisdiction classified as 
a labor surplus area pursuant to the provisions ofSec. 654.5(b) after 
any year in which the Assistant Secretary determines that the 
exceptional circumstances criteria of that paragraph are no longer met.

[44 FR 1689, Jan. 5, 1979, as amended at 48 FR 15616, Apr. 12, 1983]



Sec.  654.7  Publication of area classifications.

    The Assistant Secretary shall publish annually a list of labor 
surplus areas together with geographic descriptions thereof. The 
Assistant Secretary periodically may cause these lists to be published 
in the Federal Register.

[44 FR 1689, Jan. 5, 1979, as amended at 48 FR 15616, Apr. 12, 1983]



Sec.  654.8  Services to firms and individuals in labor surplus
areas.

    To carry out the purposes and policy objectives of Executive Order 
12073 and Executive Order 10582, the Assistant Secretary shall cooperate 
with and assist the State Workforce Agencies and the Secretary of 
Commerce, as appropriate, to:
    (a) Provide relevant labor market data and related economic 
information to assist in the initiation of industrial expansion programs 
in labor surplus areas;
    (b) Identify upon request the skills and numbers of unemployed 
persons available for work in labor surplus areas, providing such 
information to

[[Page 461]]

firms interested in establishing new plants and facilities or
expanding 
existing plants and facilities in such areas;
    (c) Identify the occupational composition and skill requirements of 
industries contemplating locating in labor surplus areas and make such 
information available to training and apprenticeship agencies and 
resources in the community for purposes of appropriate training and 
skill development;
    (d) Identify unemployed individuals in need of, and having the 
potential for, training in occupations and skills required by new or 
expanding industries and refer such individuals to appropriate training 
opportunities;
    (e) Receive job openings on a voluntary basis and/or under the 
mandatory listing program provided by 38 U.S.C. 2012 and Executive Order 
11701 and refer qualified unemployed workers to such openings, making 
appropriate efforts to refer to such openings qualified individuals who 
reside in the labor surplus area.

[44 FR 1689, Jan. 5, 1979, as amended at 48 FR 15616, Apr. 12, 1983; 71 
FR 35518, June 21, 2006]



Sec.  654.9  Filing of complaints.

    Complaints alleging that the Department of Labor has violated the 
labor surplus area regulations should be mailed to the Assistant 
Secretary for Employment and Training, U.S. Department of Labor, 
Washington, DC 20210. Such complaints should include: (a) The 
allegations of wrongdoing; (b) the date of the incident; and (c) any 
other relevant information available to the complainant. The Assistant 
Secretary shall make a determination and respond to the complainant 
after investigation of the incident. If the complaint is not resolved 
following this investigation, the Assistant Secretary, at his 
discretion, may offer, in writing by certified mail, the complainant a 
hearing before a Department of Labor Administrative Law Judge, provided 
that the complainant requests such a hearing from the Assistant 
Secretary within 20 working days of the certified date of receipt of the 
Assistant Secretary's offer of a hearing.

[48 FR 15616, Apr. 12, 1983]



Sec.  654.10  Transition provisions.

    The annual list of labor surplus areas for the period June 1, 1982, 
through May 31, 1983, shall be extended through September 30, 1983.

[48 FR 15616, Apr. 12, 1983]



         Subpart B_Responsibilities Under Executive Order 10582

    Authority: 41 U.S.C. 10a et seq.; 29 U.S.C. 49 et seq.; 15 U.S.C. 
644(n); E.O. 12073, E.O. 10582 as amended by E.O. 11051 and 12148.



Sec.  654.11  Purpose of subpart.

    This subpart implements the responsibilities of the Secretary of 
Labor in determining areas of substantial unemployment in accordance 
with Executive Order 10582 issued pursuant to the Buy American Act, 41 
U.S.C. 10a et seq.



Sec.  654.12  Description of Executive Order 10582.

    (a) Under the Buy American Act, heads of executive agencies are 
required to determine, as a condition precedent to the purchase by their 
agencies of materials of foreign origin for public use within the United 
States, (1) that the price of like materials of domestic origin is 
unreasonable, or (2) that the purchase of like materials of domestic 
origin is inconsistent with the public interest.
    (b) Section 3(c) of Executive Order 10582 issued pursuant to the Buy 
American Act permits executive agencies to reject a bid or offer to 
furnish materials of foreign origin in any situation in which the 
domestic supplier, offering the lowest price for furnishing the desired 
materials, undertakes to produce substantially all of the materials in 
areas of substantial unemployment, as determined by the Secretary of 
Labor.



Sec.  654.13  Determination of areas of substantial unemployment.

    An area of substantial unemployment, for purposes of Executive Order 
10582, shall be any area classified as a labor surplus area atSec. 
654.5 of this part pursuant to the procedures set forth at subpart A of 
this part.

[[Page 462]]



Sec.  654.14  Filing of complaints.

    Complaints arising under subpart B of this part alleging that the 
Department of Labor has violated the labor surplus area regulations 
shall be made pursuant to the procedures set forth atSec. 654.9 of 
this part.

[48 FR 15616, Apr. 12, 1983]

Subparts C-D [Reserved]



               Subpart E_Housing for Agricultural Workers

    Authority: 29 U.S.C. 49k; 8 U.S.C. 1188(c)(4); 41 Op.A.G. 406 
(1959).

    Source: 45 FR 14182, Mar. 4, 1980, unless otherwise noted.

                        Purpose and Applicability



Sec.  654.400  Scope and purpose.

    (a) This subpart sets forth the Employment and Training 
Administration standards for agricultural housing. Local Job Service 
offices, as part of the State employment service agencies and in 
cooperation with the United States Employment Service, assist employers 
in recruiting agricultural workers from places outside the area of 
intended employment. The experiences of the employment service indicate 
that employees so referred have on many occasions been provided with 
inadequate, unsafe, and unsanitary housing conditions. To discourage 
this practice, it is the policy of the Federal-State employment service 
system, as set forth inSec. 653.108 of this chapter, to deny its 
intrastate and interstate recruitment services to employers until the 
State employment service agency has ascertained that the employer's 
housing meets certain standards.
    (b) To implement this policy,Sec. 653.108 of this chapter provides 
that recruitment services shall be denied unless the employer has signed 
an assurance, a preoccupancy inspection has been conducted and the ES 
staff has ascertained that, with respect to intrastate clearance, if the 
workers are to be housed, the employer's housing meets or, with respect 
to interstate clearance, that the employer will provide housing for the 
workers which meets either the full set of standards set forth at 29 CFR 
1910.142 or the full set of standards set forth in this subpart. 
Whichever is applicable under the criteria set forth inSec. 654.401; 
except that for mobile range housing for sheepherders, the housing shall 
meet existing Departmental guidelines.

[45 FR 14182, Mar. 4, 1980; 45 FR 22901, Apr. 4, 1980]



Sec.  654.401  Applicability; transitional provisions.

    (a) Employers whose housing was constructed in accordance with the 
ETA housing standards may continue to follow the full set of ETA 
standards set forth in this subpart only where prior to April 3, 1980 
the housing was completed or under construction, or where prior to March 
4, 1980 a contract for the construction of the specific housing was 
signed.
    (b) To effectuate these transitional provisions, agricultural 
housing to which this subpart applies and which complies with the full 
set of standards set forth in this subpart shall be considered to be in 
compliance with the Occupational Safety and Health Administration 
temporary labor camp standards at 29 CFR 1910.142.



Sec.  654.402  Variances.

    (a) An employer may apply for a permanent, structural variance from 
a specific standard(s) in this subpart by filing a written application 
for such a variance with the local Job Service office serving the area 
in which the housing is located. This application must be filed by June 
2, 1980 and must:
    (1) Clearly specify the standard(s) from which the variance is 
desired;
    (2) Provide adequate justification that the variance is necessary to 
obtain a beneficial use of an existing facility, and to prevent a 
practical difficulty or unnecessary hardship; and
    (3) Clearly set forth the specific alternative measures which the 
employer has taken to protect the health and safety of workers and 
adequately show that such alternative measures have achieved the same 
result as the standard(s) from which the employer desires the variance.
    (b) Upon receipt of a written request for a variance under paragraph 
(a) of

[[Page 463]]

this section, the local Job Service office shall send the request to the 
State office which, in turn, shall forward it to the Regional 
Administrator, Employment and Training Administration (RA). The RA shall 
review the matter and, after consultation with OSHA, shall either grant 
or deny the request for a variance.
    (c) The variance granted by the RA shall be in writing, shall state 
the particular standard(s) involved, and shall state as conditions of 
the variance the specific alternative measures which have been taken to 
protect the health and safety of the workers. The RA shall send the 
approved variance to the employer and shall send copies to the Regional 
Administrator of the Occupational Safety and Health Administration, the 
Regional Administrator of the Employment Standards Administration, and 
the appropriate State agency and the local Job Service office. The 
employer shall submit and the local Job Service office shall attach 
copies of the approved variance to each of the employer's job orders 
which is placed into intrastate or interstate clearance.
    (d) If the RA denies the request for a variance, the RA shall 
provide written notice stating the reasons for the denial to the 
employer, the appropriate State agency and the local Job Service office. 
The notice shall also offer the employer an opportunity to request a 
hearing before a DOL Hearing Officer, provided the employer requests 
such a hearing from the RA within 30 calendar days of the date of the 
notice. The request for a hearing shall be handled in accordance with 
the employment service complaint procedures set forth at Sec.Sec. 
658.421 (i) and (j), 658.422 and 658.423 of this chapter.
    (e) The procedures of paragraphs (a) through (d) of this section 
shall only apply to an employer who has chosen, as evidenced by its 
written request for a variance, to comply with the ETA housing standards 
at Sec.Sec. 654.404-654.417 of this subpart.



Sec.  654.403  Conditional access to the intrastate or interstate
clearance system.

    (a) Filing requests for conditional access--(1) ``Noncriteria'' 
employers. Except as provided in paragraph (a)(2) of this section, an 
employer whose housing does not meet applicable standards may file with 
the local Job Service office serving the area in which its housing is 
located, a written request that its job orders be conditionally allowed 
into the intrastate or interstate clearance system, provided that the 
employer's request assures that its housing will be in full compliance 
with the requirements of the applicable housing standards at least 20 
calendar days (giving the specific date) before the housing is to be 
occupied.
    (2) ``Criteria'' employers. If the request for conditional access 
described in paragraph (a)(1) of this section is from an employer filing 
a job order pursuant to an application for temporary alien agricultural 
labor certification for H-2A alien agricultural workers or H-2 alien 
workers under subpart B or subpart C, respectively, of part 655 of this 
chapter, the request shall be filed with the RA as an attachment to the 
application for temporary alien agricultural labor certification.
    (3) Assurance. The employer's request pursuant to paragraphs (a)(1) 
or (a)(2) of this section shall contain an assurance that the housing 
will be in full compliance with the applicable housing standards at 
least 20 calendar days (stating the specific date) before the housing is 
to be occupied.
    (b) Processing requests--(1) State agency processing. Upon receipt 
of a written request for conditional access to the intrastate or 
interstate clearance system under paragraph (a)(1) of this section, the 
local Job Service office shall send the request to the State office, 
which, in turn, shall forward it to the Regional Administrator, 
Employment and Training Administration, (RA).
    (2) Regional office processing and determination. Upon receipt of a 
request for conditional access pursuant to paragraph (a)(2) or paragraph 
(b)(1) of this section, the RA shall review the matter and, as 
appropriate, shall either grant or deny the request.
    (c) Authorization. The authorization for conditional access to the 
intrastate or interstate clearance system shall be in writing, and shall 
state that although the housing does not comply with the applicable 
standards, the employer's job order may be placed into

[[Page 464]]

intrastate or interstate clearance until a specified date. The RA shall 
send the authorization to the employer and shall send copies to the 
appropriate State agency and local Job Service office. The employer 
shall submit and the local Job Service shall attach copies of the 
authorization to each of the employer's job orders which is placed into 
intrastate or interstate clearance.
    (d) Notice of denial. If the RA denies the request for conditional 
access to the intrastate or interstate clearance system, the RA shall 
provide written notice to the employer, the appropriate State agency, 
and the local Job Service office, stating the reasons for the denial.
    (e) Inspection. (1) The local Job Service office serving the area 
containing the housing of any employer granted conditional access to the 
intrastate or interstate clearance system shall assure that the housing 
is inspected no later than the date by which the employer has promised 
to have its housing in compliance with the requirements of this subpart. 
An employer, however, may request an earlier preliminary inspection. If, 
on the date set forth in the authorization, the housing is not in full 
compliance with the applicable housing standards as assured in the 
request for conditional access, the local Job Service office shall 
afford the employer five calendar days to bring the housing into full 
compliance. After the five-calendar-day period, if the housing is not in 
full compliance with the applicable housing standards as assured in the 
request for conditional access, the local Job Service office 
immediately:
    (i) Shall notify the RA;
    (ii) Shall remove the employer's job orders from intrastate and 
interstate clearance; and
    (iii) Shall, if workers have been recruited against these orders, in 
cooperation with the employment service agencies in other States, make 
every reasonable attempt to locate and notify the appropriate crew 
leaders or workers, and to find alternative and comparable employment 
for the workers.

[52 FR 20506, June 1, 1987, as amended at 64 FR 34965, June 29, 1999]

                            Housing Standards



Sec.  654.404  Housing site.

    (a) Housing sites shall be well drained and free from depressions in 
which water may stagnate. They shall be located where the disposal of 
sewage is provided in a manner which neither creates nor is likely to 
create a nuisance, or a hazard to health.
    (b) Housing shall not be subject to, or in proximity to conditions 
that create or are likely to create offensive odors, flies, noise, 
traffic, or any similar hazards.
    (c) Grounds within the housing site shall be free from debris, 
noxious plants (poison ivy, etc.) and uncontrolled weeds or brush.
    (d) The housing site shall provide a space for recreation reasonably 
related to the size of the facility and the type of occupancy.



Sec.  654.405  Water supply.

    (a) An adequate and convenient supply of water that meets the 
standards of the State health authority shall be provided.
    (b) A cold water tap shall be available within 100 feet of each 
individual living unit when water is not provided in the unit. Adequate 
drainage facilities shall be provided for overflow and spillage.
    (c) Common drinking cups shall not be permitted.



Sec.  654.406  Excreta and liquid waste disposal.

    (a) Facilities shall be provided and maintained for effective 
disposal of excreta and liquid waste. Raw or treated liquid waste shall 
not be discharged or allowed to accumulate on the ground surface.
    (b) Where public sewer systems are available, all facilities for 
disposal of excreta and liquid wastes shall be connected thereto.
    (c) Where public sewers are not available, a subsurface septic tank-
seepage system or other type of liquid waste treatment and disposal 
system, privies or portable toilets shall be provided. Any requirements 
of the State health authority shall be complied with.

[[Page 465]]



Sec.  654.407  Housing.

    (a) Housing shall be structurally sound, in good repair, in a 
sanitary condition and shall provide protection to the occupants against 
the elements.
    (b) Housing shall have flooring constructed of rigid materials, 
smooth finished, readily cleanable, and so located as to prevent the 
entrance of ground and surface water.
    (c) The following space requirements shall be provided:
    (1) For sleeping purposes only in family units and in dormitory 
accommodations using single beds, not less than 50 square feet of floor 
space per occupant;
    (2) For sleeping purposes in dormitory accommodations using double 
bunk beds only, not less than 40 square feet per occupant;
    (3) For combined cooking, eating, and sleeping purposes not less 
than 60 square feet of floor space per occupant.
    (d) Housing used for families with one or more children over 6 years 
of age shall have a room or partitioned sleeping area for the husband 
and wife. The partition shall be of rigid materials and installed so as 
to provide reasonable privacy.
    (e) Separate sleeping accommodations shall be provided for each sex 
or each family.
    (f) Adequate and separate arrangements for hanging clothing and 
storing personal effects for each person or family shall be provided.
    (g) At least one-half of the floor area in each living unit shall 
have a minimum ceiling height of 7 feet. No floor space shall be counted 
toward minimum requirements where the ceiling height is less than 5 
feet.
    (h) Each habitable room (not including partitioned areas) shall have 
at least one windown or skylight opening directly to the out-of-doors. 
The minimum total window or skylight area, including windows in doors, 
shall equal at least 10 percent of the usable floor area. The total 
openable area shall equal at least 45 percent of the minimum window or 
skylight area required, except where comparably adequate ventilation is 
supplied by mechanical or some other method.



Sec.  654.408  Screening.

    (a) All outside openings shall be protected with screening of not 
less than 16 mesh.
    (b) All screen doors shall be tight fitting, in good repair, and 
equipped with self-closing devices.



Sec.  654.409  Heating.

    (a) All living quarters and service rooms shall be provided with 
properly installed, operable heating equipment capable of maintaining a 
temperature of at least 68 [deg]F. if during the period of normal 
occupancy the temperature in such quarters falls below 68[deg].
    (b) Any stoves or other sources of heat utilizing combustible fuel 
shall be installed and vented in such a manner as to prevent fire 
hazards and a dangerous concentration of gases. No portable heaters 
other than those operated by electricity shall be provided. If a solid 
or liquid fuel stove is used in a room with wooden or other combustible 
flooring, there shall be a concrete slab, insulated metal sheet, or 
other fireproof material on the floor under each stove, extending at 
least 18 inches beyond the perimeter of the base of the stove.
    (c) Any wall or ceiling within 18 inches of a solid or liquid fuel 
stove or a stovepipe shall be of fireproof material. A vented metal 
collar shall be installed around a stovepipe, or vent passing through a 
wall, ceiling, floor or roof.
    (d) When a heating system has automatic controls, the controls shall 
be of the type which cut off the fuel supply upon the failure or 
interruption of the flame or ignition, or whenever a predetermined safe 
temperature or pressure is exceeded.

[45 FR 14182, Mar. 4, 1980; 45 FR 22901, Apr. 4, 1980]



Sec.  654.410  Electricity and lighting.

    (a) All housing sites shall be provided with electric service.
    (b) Each habitable room and all common use rooms, and areas such as: 
Laundry rooms, toilets, privies, hallways, stairways, etc., shall 
contain adequate ceiling or wall-type light fixtures. At least one wall-
type electrical

[[Page 466]]

convenience outlet shall be provided in each individual living room.
    (c) Adequate lighting shall be provided for the yard area, and 
pathways to common use facilities.
    (d) All wiring and lighting fixtures shall be installed and 
maintained in a safe condition.



Sec.  654.411  Toilets.

    (a) Toilets shall be constructed, located and maintained so as to 
prevent any nuisance or public health hazard.
    (b) Water closets or privy seats for each sex shall be in the ratio 
of not less than one such unit for each 15 occupants, with a minimum of 
one unit for each sex in common use facilities.
    (c) Urinals, constructed of nonabsorbent materials, may be 
substituted for men's toilet seats on the basis of one urinal or 24 
inches of trough-type urinal for one toilet seat up to a maximum of one-
third of the required toilet seats.
    (d) Except in individual family units, separate toilet 
accommodations for men and women shall be provided. If toilet facilities 
for men and women are in the same building, they shall be separated by a 
solid wall from floor to roof or ceiling. Toilets shall be distinctly 
marked ``men'' and ``women'' in English and in the native language of 
the persons expected to occupy the housing.
    (e) Where common use toilet facilities are provided, an adequate and 
accessible supply of toilet tissue, with holders, shall be furnished.
    (f) Common use toilets and privies shall be well lighted and 
ventilated and shall be clean and sanitary.
    (g) Toilet facilities shall be located within 200 feet of each 
living unit.
    (h) Privies shall not be located closer than 50 feet from any living 
unit or any facility where food is prepared or served.
    (i) Privy structures and pits shall be fly tight. Privy pits shall 
have adequate capacity for the required seats.



Sec.  654.412  Bathing, laundry, and handwashing.

    (a) Bathing and handwashing facilities, supplied with hot and cold 
water under pressure, shall be provided for the use of all occupants. 
These facilities shall be clean and sanitary and located within 200 feet 
of each living unit.
    (b) There shall be a minimum of 1 showerhead per 15 persons. 
Showerheads shall be spaced at least 3 feet apart, with a minimum of 9 
square feet of floor space per unit. Adequate, dry dressing space shall 
be provided in common use facilities. Shower floors shall be constructed 
of nonabsorbent nonskid materials and sloped to properly constructed 
floor drains. Except in individual family units, separate shower 
facilities shall be provided each sex. When common use shower facilities 
for both sexes are in the same building they shall be separated by a 
solid nonabsorbent wall extending from the floor to ceiling, or roof, 
and shall be plainly designated ``men'' or ``women'' in English and in 
the native language of the persons expected to occupy the housing.
    (c) Lavatories or equivalent units shall be provided in a ratio of 1 
per 15 persons.
    (d) Laundry facilities, supplied with hot and cold water under 
pressure, shall be provided for the use of all occupants. Laundry trays 
or tubs shall be provided in the ratio of 1 per 25 persons. Mechanical 
washers may be provided in the ratio of 1 per 50 persons in lieu of 
laundry trays, although a minimum of 1 laundry tray per 100 persons 
shall be provided in addition to the mechanical washers.



Sec.  654.413  Cooking and eating facilities.

    (a) When workers or their families are permitted or required to cook 
in their individual unit, a space shall be provided and equipped for 
cooking and eating. Such space shall be provided with:
    (1) A cookstove or hot plate with a minimum of two burners; and (2) 
adequate food storage shelves and a counter for food preparation; and 
(3) provisions for mechanical refrigeration of food at a temperature of 
not more than 45 [deg]F.; and (4) a table and chairs or equivalent 
seating and eating arrangements, all commensurate with the capacity of 
the unit; and (5) adequate lighting and ventilation.
    (b) When workers or their families are permitted or required to cook 
and

[[Page 467]]

eat in a common facility, a room or building separate from the sleeping 
facilities shall be provided for cooking and eating. Such room or 
building shall be provided with:
    (1) Stoves or hot plates, with a minimum equivalent of two burners, 
in a ratio of 1 stove or hot plate to 10 persons, or 1 stove or hot 
plate to 2 families; and (2) adequate food storage shelves and a counter 
for food preparation; and (3) mechanical refrigeration for food at a 
temperature of not more than 45 [deg]F.; and (4) tables and chairs or 
equivalent seating adequate for the intended use of the facility; and 
(5) adequate sinks with hot and cold water under pressure; and (6) 
adequate lighting and ventilation; and (7) floors shall be of 
nonabsorbent, easily cleaned materials.
    (c) When central mess facilities are provided, the kitchen and mess 
hall shall be in proper proportion to the capacity of the housing and 
shall be separate from the sleeping quarters. The physical facilities, 
equipment and operation shall be in accordance with provisions of 
applicable State codes.
    (d) Wall surface adjacent to all food preparation and cooking areas 
shall be of nonabsorbent, easily cleaned material. In addition, the wall 
surface adjacent to cooking areas shall be of fire-resistant material.



Sec.  654.414  Garbage and other refuse.

    (a) Durable, fly-tight, clean containers in good condition of a 
minimum capacity of 20 gallons, shall be provided adjacent to each 
housing unit for the storage of garbage and other refuse. Such 
containers shall be provided in a minimum ratio of 1 per 15 persons.
    (b) Provisions shall be made for collection of refuse at least twice 
a week, or more often if necessary. The disposal of refuse, which 
includes garbage, shall be in accordance with State and local law.



Sec.  654.415  Insect and rodent control.

    Housing and facilities shall be free of insects, rodents, and other 
vermin.



Sec.  654.416  Sleeping facilities.

    (a) Sleeping facilities shall be provided for each person. Such 
facilities shall consist of comfortable beds, cots, or bunks, provided 
with clean mattresses.
    (b) Any bedding provided by the housing operator shall be clean and 
sanitary.
    (c) Triple deck bunks shall not be provided.
    (d) The clear space above the top of the lower mattress of a double 
deck bunk and the bottom of the upper bunk shall be a minimum of 27 
inches. The distance from the top of the upper mattress to the ceiling 
shall be a minimum of 36 inches.
    (e) Beds used for double occupancy may be provided only in family 
accommodations.



Sec.  654.417  Fire, safety, and first aid.

    (a) All buildings in which people sleep or eat shall be constructed 
and maintained in accordance with applicable State or local fire and 
safety laws.
    (b) In family housing and housing units for less than 10 persons, of 
one story construction, two means of escape shall be provided. One of 
the two required means of escape may be a readily accessible window with 
an openable space of not less than 24x24 inches.
    (c) All sleeping quarters intended for use by 10 or more persons, 
central dining facilities, and common assembly rooms shall have at least 
two doors remotely separated so as to provide alternate means of escape 
to the outside or to an interior hall.
    (d) Sleeping quarters and common assembly rooms on the second story 
shall have a stairway, and a permanent, affixed exterior ladder or a 
second stairway.
    (e) Sleeping and common assembly rooms located above the second 
story shall comply with the State and local fire and building codes 
relative to multiple story dwellings.
    (f) Fire extinguishing equipment shall be provided in a readily 
accessible place located not more than 100 feet from each housing unit. 
Such equipment shall provide protection equal to a 2\1/2\ gallon stored 
pressure or 5-gallon pump-type water extinguisher.
    (g) First aid facilities shall be provided and readily accessible 
for use at

[[Page 468]]

all time. Such facilities shall be equivalent to the 16 unit first aid 
kit recommended by the American Red Cross, and provided in a ratio of 1 
per 50 persons.
    (h) No flammable or volatile liquids or materials shall be stored in 
or adjacent to rooms used for living purposes, except for those needed 
for current household use.
    (i) Agricultural pesticides and toxic chemicals shall not be stored 
in the housing area.



PART 655_TEMPORARY EMPLOYMENT OF FOREIGN WORKERS IN THE UNITED STATES
--Table of Contents



Sec.
655.0 Purpose and scope of part.
655.00 Authority of the Office of Foreign Labor Certification (OFLC) 
          Administrator under subparts A, B, and C.

 Subpart A_Labor Certification Process and Enforcement of Attestations 
   for Temporary Employment in Occupations Other Than Agriculture or 
         Registered Nursing in the United States (H	2B Workers)

655.1 Purpose and scope of subpart A.
655.2 Territory of Guam.
655.3 Special procedures.
655.4 Definitions of terms used in this subpart.
655.5 Purpose and scope of subpart A.
655.6 Temporary need.
655.7 Persons and entities authorized to file.
655.8 Requirements for agents.
655.9 Disclosure of foreign worker recruitment.

                          Prefiling Procedures

655.10 Determination of prevailing wage for temporary labor 
          certification purposes.
655.11 Certifying officer review of prevailing wage determinations.
655.12 Use of registration of H-2B employers.
655.13 Review of PWDs.
655.14 [Reserved]

  Application for Temporary Employment Certification Filing Procedures

655.15 Required pre-filing recruitment.
655.16 Filing of the job order at the SVA.
655.17 Advertising requirements.
655.18 Job order assurances and contents.
655.19 Job contractor filing requirements.

                       Assurances and Obligations

655.20 Applications for temporary employment certification.
655.21 Supporting evidence for temporary need.
655.22 Obligations of H-2B employers.
655.23 Receipt and processing of applications.
655.24 Audits.
655.25-655.29 [Reserved]

   Processing of an Application for Temporary Employment Certification

655.30 Supervised recruitment.
655.31 Debarment.
655.32 Labor certification determinations.
655.33 Administrative review.
655.34 Validity of temporary labor certifications.
655.35 Required departure.
655.36-655.39 [Reserved]

                      Post-Acceptance Requirements

655.40 Employer-conducted recruitment.
655.41 Advertising requirements.
655.42 Newspaper advertisements.
655.43 Contact with former U.S. employees.
655.44 [Reserved]
655.45 Contact with bargaining representative, posting and other contact 
          requirements.
655.46 Additional employer-conducted recruitment.
655.47 Referrals of U.S. workers.
655.48 Recruitment report.
655.49 [Reserved]

                   Labor Certification Determinations

655.50 Determinations.
655.51 Criteria for certification.
655.52 Approved certification.
655.53 Denied certification.
655.54 Partial certification.
655.55 Validity of temporary labor certification.
655.56 Document retention requirements of H-2B employers.
655.57 Request for determination based on nonavailability of U.S. 
          workers.
655.58-655.59 [Reserved]
655.60 Violations.
655.61 Administrative review.
655.62 Withdrawal of an Application for Temporary Employment 
          Certification.
655.63 Public disclosure.
655.64 [Reserved]
655.65 Remedies for violations.
655.66-655.69 [Reserved]

                           Integrity Measures

655.70 WHD Administrator's determination.
655.71 Request for hearing.
655.72 Hearing rules of practice.
655.73 Service of pleadings.
655.74 Conduct of proceedings.

[[Page 469]]

655.75 Decision and order of administrative law judge.
655.76 Appeal of administrative law judge decision.
655.80 Notice to OFLC and DHS.
655.81 Application filing transition.
655.82-655.99 [Reserved]

    Subpart B_Labor Certification Process for Temporary Agricultural 
             Employment in the United States (H	2A Workers)

655.100 Scope and purpose of subpart B.
655.101 Authority of the Office of Foreign Labor Certification (OFLC) 
          administrator.
655.102 Special procedures.
655.103 Overview of this subpart and definition of terms.

                          Prefiling Procedures

655.120 Offered wage rate.
655.121 Job orders.
655.122 Contents of job offers.

  Application for Temporary Employment Certification Filing Procedures

655.130 Application filing requirements.
655.131 Association filing requirements.
655.132 H-2A labor contractor (H-2ALC) filing requirements.
655.133 Requirements for agents.
655.134 Emergency situations.
655.135 Assurances and obligations of H-2A employers.

    Processing of Application for Temporary Employment Certification

655.140 Review of applications.
655.141 Notice of deficiency.
655.142 Submission of modified applications.
655.143 Notice of acceptance.
655.144 Electronic job registry.
655.145 Amendments to applications for temporary employment 
          certification.

                      Post-Acceptance Requirements

655.150 Interstate clearance of job order.
655.151 Newspaper advertisements.
655.152 Advertising requirements.
655.153 Contact with former U.S. employees.
655.154 Additional positive recruitment.
655.155 Referrals of U.S. workers.
655.156 Recruitment report.
655.157 Withholding of U.S. workers prohibited.
655.158 Duration of positive recruitment.

                   Labor Certification Determinations

655.160 Determinations.
655.161 Criteria for certification.
655.162 Approved certification.
655.163 Certification fee.
655.164 Denied certification.
655.165 Partial certification.
655.166 Requests for determinations based on nonavailability of U.S. 
          workers.
655.167 Document retention requirements.

                           Post Certification

655.170 Extensions.
655.171 Appeals.
655.172 Withdrawal of job order and application for temporary employment 
          certification.
655.173 Setting meal charges; petition for higher meal charges.
655.174 Public disclosure.

                           Integrity Measures

655.180 Audit.
655.181 Revocation.
655.182 Debarment.
655.183 Less than substantial violations.
655.184 Applications involving fraud or willful misrepresentation.
655.185 Job service complaint system; enforcement of work contracts.

 Subpart C_Labor Certification Process for Logging Employment and Non-H	
                       2A Agricultural Employment

655.200 General description of this subpart and definition of terms.
655.201 Temporary labor certification applications.
655.202 Contents of job offers.
655.203 Assurances.
655.204 Determinations based on temporary labor certification 
          applications.
655.205 Recruitment period.
655.206 Determinations of U.S. worker availability and adverse effect on 
          U.S. workers.
655.207 Adverse effect rates.
655.208 Temporary labor certification applications involving fraud or 
          willful misrepresentation.
655.209 Invalidation of temporary labor certifications.
655.210 Failure of employers to comply with the terms of a temporary 
          labor certification.
655.211 Petition for higher meal charges.
655.212 Administrative-judicial reviews.
655.215 Territory of Guam.

   Subpart D_Attestations by Facilities Using Nonimmigrant Aliens as 
                            Registered Nurses

655.300 Purpose and scope of subparts D and E.
655.301 Overview of process.
655.302 Definitions.
655.310 Attestations.
655.315 State plans.
655.320 Appeals of acceptance and rejection of attestations submitted 
          for filing and of State plans.
655.350 Public access.

[[Page 470]]

               Subpart E_Enforcement of H	1A Attestations

655.400 Enforcement authority of Administrator, Wage and Hour Division.
655.405 Complaints and investigative procedures.
655.410 Civil money penalties and other remedies.
655.415 Written notice and service of Administrator's determination.
655.420 Request for hearing.
655.425 Rules of practice for administrative law judge proceedings.
655.430 Service and computation of time.
655.435 Administrative law judge proceedings.
655.440 Decision and order of administrative law judge.
655.445 Secretary's review of administrative law judge's decision.
655.450 Administrative record.
655.455 Notice to the Attorney General and the Employment and Training 
          Administration.
655.460 Non-applicability of the Equal Access to Justice Act.

    Subpart F_Attestations by Employers Using Alien Crewmembers for 
                   Longshore Activities in U.S. Ports

                           General Provisions

655.500 Purpose, procedure and applicability of subparts F and G of this 
          part.
655.501 Overview of responsibilities.
655.502 Definitions.
655.510 Employer attestations.
655.520 Special provisions regarding automated vessels.

                            Alaska Exception

655.530 Special provisions regarding the performance of longshore 
          activities at locations in the State of Alaska.
655.531 Who may submit attestations for locations in Alaska?
655.532 Where and when should attestations be submitted for locations in 
          Alaska?
655.533 What should be submitted for locations in Alaska?
655.534 The first attestation element for locations in Alaska: Bona fide 
          request for dispatch of United States longshore workers.
655.535 The second attestation element for locations in Alaska: 
          Employment of United States longshore workers.
655.536 The third attestation element for locations in Alaska: No 
          intention or design to influence bargaining representative 
          election.
655.537 The fourth attestation element for locations in Alaska: Notice 
          of filing.
655.538 Actions on attestations submitted for filing for locations in 
          Alaska.
655.539 Effective date and validity of filed attestations for locations 
          in Alaska.
655.540 Suspension or invalidation of filed attestations for locations 
          in Alaska.
655.541 Withdrawal of accepted attestations for locations in Alaska.

                              Public Access

655.550 Public access.

Appendix A to Subpart F--U.S. Seaports

  Subpart G_Enforcement of the Limitations Imposed on Employers Using 
        Alien Crewmembers for Longshore Activities in U.S. Ports

655.600 Enforcement authority of Administrator, Wage and Hour Division.
655.605 Complaints and investigative procedures.
655.610 Automated vessel exception to prohibition on utilization of 
          alien crewmember(s) to perform longshore activity(ies) at a 
          U.S. port.
655.615 Cease and desist order.
655.620 Civil money penalties and other remedies.
655.625 Written notice, service and Federal Register publication of 
          Administrator's determination.
655.630 Request for hearing.
655.635 Rules of practice for administrative law judge proceedings.
655.640 Service and computation of time.
655.645 Administrative law judge proceedings.
655.650 Decision and order of administrative law judge.
655.655 Secretary's review of administrative law judge's decision.
655.660 Administrative record.
655.665 Notice to the Department of Homeland Security and the Employment 
          and Training Administration.
655.670 Federal Register notice of determination of prevailing practice.
655.675 Non-applicability of the Equal Access to Justice Act.

 Subpart H_Labor Condition Applications and Requirements for Employers 
 Seeking To Employ Nonimmigrants on H	1b Visas in Specialty Occupations 
and as Fashion Models, and Requirements for Employers Seeking To Employ 
      Nonimmigrants on H-1b1 and E-3 Visas in Specialty Occupations

655.700 What statutory provisions govern the employment of H-1B, H-1B1, 
          and E-3 nonimmigrants and how do employers apply for H-1B, H-
          1B1, and E-3 visas?
655.705 What Federal agencies are involved in the H-1B and H-1B1 
          programs, and what are the responsibilities of those agencies 
          and of employers?

[[Page 471]]

655.710 What is the procedure for filing a complaint?
655.715 Definitions
655.720 Where are labor condition applications (LCAs) to be filed and 
          processed?
655.721 [Reserved]
655.730 What is the process for filing a labor condition application?
655.731 What is the first LCA requirement, regarding wages?
655.732 What is the second LCA requirement, regarding working 
          conditions?
655.733 What is the third LCA requirement, regarding strikes and 
          lockouts?
655.734 What is the fourth LCA requirement, regarding notice?
655.735 What are the special provisions for short-term placement of H-1B 
          nonimmigrants at place(s) of employment outside the area(s) of 
          intended employment listed on the LCA?
655.736 What are H-1B-dependent employers and willful violators?
655.737 What are ``exempt'' H-1B nonimmigrants, and how does their 
          employment affect the additional attestation obligations of H-
          1B-dependent employers and willful violator employers?
655.738 What are the ``non-displacement of U.S. workers'' obligations 
          that apply to H-1B-dependent employers and willful violators, 
          and how do they operate?
655.739 What is the ``recruitment of U.S. workers'' obligation that 
          applies to H-1B-dependent employers and willful violators, and 
          how does it operate?
655.740 What actions are taken on labor condition applications?
655.750 What is the validity period of the labor condition application?
655.760 What records are to be made available to the public, and what 
          records are to be retained?

Subpart I_Enforcement of H	1B Labor Condition Applications and H	1B1 and 
                         E	3 Labor Attestations

655.800 Who will enforce the LCAs and how will they be enforced?
655.801 What protection do employees have from retaliation?
655.805 What violations may the Administrator investigate?
655.806 Who may file a complaint and how is it processed?
655.807 How may someone who is not an ``aggrieved party'' allege 
          violations, and how will those allegations be processed?
655.808 Under what circumstances may random investigations be conducted?
655.810 What remedies may be ordered if violations are found?
655.815 What are the requirements for the Administrator's determination?
655.820 How is a hearing requested?
655.825 What rules of practice apply to the hearing?
655.830 What rules apply to service of pleadings?
655.835 How will the administrative law judge conduct the proceeding?
655.840 What are the requirements for a decision and order of the 
          administrative law judge?
655.845 What rules apply to appeal of the decision of the administrative 
          law judge?
655.850 Who has custody of the administrative record?
655.855 What notice shall be given to the Employment and Training 
          Administration and the DHS of the decision regarding 
          violations?

  Subpart J_Attestations by Employers Using F	1 Students in Off-Campus 
                                  Work

655.900 Purpose, procedure and applicability of subparts J and K of this 
          part.
655.910 Overview of process.
655.920 Definitions.
655.930 Addresses of Department of Labor regional offices.
655.940 Employer attestations.
655.950 Public access.

Appendix A to Subpart J of Part 655--Documentation in Support of 
          Attestations Made by Employers

Subpart K_Enforcement of the Attestation Process for Attestations Filed 
         by Employers Utilizing F	1 Students in Off-campus Work

655.1000 Enforcement authority of Administrator, Wage and Hour Division.
655.1005 Complaints and investigative procedures.
655.1010 Remedies.
655.1015 Written notice and service of Administrator's determination.
655.1020 Request for hearing.
655.1025 Rules of practice for administrative law judge proceedings.
655.1030 Service and computation of time.
655.1035 Administrative law judge proceedings.
655.1040 Decision and order of administrative law judge.
655.1045 Secretary's review of administrative law judge's decision.
655.1050 Administrative record.
655.1055 Notice to the Employment and Training Administration (ETA) and 
          the Attorney General (AG).

[[Page 472]]

655.1060 Non-applicability of the Equal Access to Justice Act.

    Subpart L_What requirements must a facility meet to employ H	1C 
               nonimmigrant workers as registered nurses?

655.1100 What are the purposes, procedures and applicability of the 
          regulations in subparts L and M of this part?
655.1101 What are the responsibilities of the government agencies and 
          the facilities that participate in the H-1C program?
655.1102 What are the definitions of terms that are used in these 
          regulations?
655.1110 What requirements are imposed in the filing of an attestation?
655.1111 Element I--What hospitals are eligible to participate in the H-
          1C program?
655.1112 Element II--What does ``no adverse effect on wages and working 
          conditions'' mean?
655.1113 Element III--What does ``facility wage rate'' mean?
655.1114 Element IV--What are the timely and significant steps an H-1C 
          employer must take to recruit and retain U.S. nurses?
655.1115 Element V--What does ``no strike/lockout or layoff'' mean?
655.1116 Element VI--What notification must facilities provide to 
          registered nurses?
655.1117 Element VII--What are the limitations as to the number of H-1C 
          nonimmigrants that a facility may employ?
655.1118 Element VIII--What are the limitations as to where the H-1C 
          nonimmigrant may be employed?
655.1130 What criteria does the Department use to determine whether or 
          not to certify an Attestation?
655.1132 When will the Department suspend or invalidate an already-
          approved Attestation?
655.1135 What appeals procedures are available concerning ETA's actions 
          on a facility's Attestation?
655.1150 What materials must be available to the public?

Subpart M_What are the Department's enforcement obligations with respect 
                          to H	1C Attestations?

655.1200 What enforcement authority does the Department have with 
          respect to a facility's H-1C Attestation?
655.1205 What is the Administrator's responsibility with respect to 
          complaints and investigations?
655.1210 What penalties and other remedies may the Administrator impose?
655.1215 How are the Administrator's investigation findings issued?
655.1220 Who can appeal the Administrator's findings and what is the 
          process?
655.1225 What are the rules of practice before an ALJ?
655.1230 What time limits are imposed in ALJ proceedings?
655.1235 What are the ALJ proceedings?
655.1240 When and how does an ALJ issue a decision?
655.1245 Who can appeal the ALJ's decision and what is the process?
655.1250 Who is the official record keeper for these administrative 
          appeals?
655.1255 What are the procedures for the debarment of a facility based 
          on a finding of violation?
655.1260 Can Equal Access to Justice Act attorney fees be awarded?

    Subpart N_Labor Certification Process for Temporary Agricultural 
             Employment in the United States (H	2A Workers)

655.1290 Purpose and scope of subpart B.
655.1292 Authority of ETA-OFLC.
655.1293 Special procedures.
655.1300 Overview of subpart B and definition of terms.
655.1301 Applications for temporary employment certification in 
          agriculture.
655.1302 Required pre-filing activity.
655.1303 Advertising requirements.
655.1304 Contents of job offers.
655.1305 Assurances and obligations of H-2A employers.
655.1306 Assurances and obligations of H-2A Labor Contractors.
655.1307 Processing of applications.
655.1308 Offered wage rate.
655.1309 Labor certification determinations.
655.1310 Validity and scope of temporary labor certifications.
655.1311 Required departure.
655.1312 Audits.
655.1313 H-2A applications involving fraud or willful misrepresentation.
655.1314 Setting meal charges; petition for higher meal charges.
655.1315 Administrative review and de novo hearing before an 
          administrative law judge.
655.1316 Job Service Complaint System; enforcement of work contracts.
655.1317 Revocation of approved labor certifications.
655.1318 Debarment.
655.1319 Document retention requirements.

    Authority: Section 655.0 issued under 8 U.S.C. 1101(a)(15)(H)(i) and 
(ii), 1182(m), (n), and (t), 1184, 1188, and 1288(c) and (d); 29 U.S.C. 
49 et seq.; sec. 3(c)(1), Pub. L. 101-238, 103 Stat. 2099, 2102 (8 
U.S.C. 1182 note); sec. 221(a), Pub. L. 101-649, 104 Stat. 4978, 5027 (8 
U.S.C. 1184 note); sec. 323, Pub. L. 103-206, 107 Stat. 2149; Title IV, 
Pub. L. 105-277, 112 Stat. 2681; Pub. L. 106-95, 113 Stat. 1312 (8 
U.S.C. 1182 note); and 8 CFR 213.2(h)(4)(i).

[[Page 473]]

    Section 655.00 issued under 8 U.S.C. 1101(a)(15)(H)(ii), 1184, and 
1188; 29 U.S.C. 49 et seq.; and 8 CFR 214.2(h)(4)(i).
    Subparts A and C issued under 8 U.S.C. 1101(a)(15)(H)(ii)(b) and 
1184; 29 U.S.C. 49 et seq.; and 8 CFR 214.2(h)(4)(i).
    Subpart B issued under 8 U.S.C. 1101(a)(15)(H)(ii)(a), 1184, and 
1188; and 29 U.S.C. 49 et seq.
    Subparts D and E issued under 8 U.S.C. 1101(a)(15)(H)(i)(a), 
1182(m), and 1184; 29 U.S.C. 49 et seq.; and sec. 3(c)(1), Pub. L. 101-
238, 103 Stat. 2099, 2103 (8 U.S.C. 1182 note).
    Subparts F and G issued under 8 U.S.C. 1184 and 1288(c); and 29 
U.S.C. 49 et seq.
    Subparts H and I issued under 8 U.S.C. 1101(a)(15)(H)(i)(b) and 
(b1), 1182(n), 1182(t), and 1184; 29 U.S.C. 49 et seq.; sec 303(a)(8), 
Pub. L. 102-232, 105 Stat. 1733, 1748 (8 U.S.C. 1182 note); and Title 
IV, Pub. L. 105-277, 112 Stat. 2681.
    Subparts J and K issued under 29 U.S.C. 49 et seq.; and sec. 221(a), 
Pub. L. 101-649, 104 Stat. 4978, 5027 (8 U.S.C. 1184 note).
    Subparts L and M issued under 8 U.S.C. 1101(a)(15)(H)(i)(c), 
1182(m), and 1184; 29 U.S.C. 49 et seq., and Pub. L. 109-423, 120 Stat. 
2900.

    Source: 42 FR 45899, Sept. 13, 1977, unless otherwise noted.

    Editorial Note: Nomenclature changes to part 655 appear at 71 FR 
35521, 35522, June 21, 2006.



Sec.  655.0  Scope and purpose of part.

    (a) Subparts A, B, and C--(1) General. Subparts A, B, and C of this 
part set out the procedures adopted by the Secretary to secure 
information sufficient to make factual determinations of: (i) Whether 
U.S. workers are available to perform temporary employment in the United 
States, for which an employer desires to employ nonimmigrant foreign 
workers, and (ii) whether the employment of aliens for such temporary 
work will adversely affect the wages or working conditions of similarly 
employed U.S. workers. These factual determinations (or a determination 
that there are not sufficient facts to make one or both of these 
determinations) are required to carry out the policies of the 
Immigration and Nationality Act (INA), that a nonimmigrant alien worker 
not be admitted to fill a particular temporary job opportunity unless no 
qualifed U.S. worker is available to fill the job opportunity, and 
unless the employment of the foreign worker in the job opportunity will 
not adversely affect the wages or working conditions of similarly 
employed U.S. workers.
    (2) The Secretary's determinations. Before any factual determination 
can be made concerning the availability of U.S. workers to perform 
particular job opportunities, two steps must be taken. First, the 
minimum level of wages, terms, benefits, and conditions for the 
particular job opportunities, below which similarly employed U.S. 
workers would be adversely affected, must be established. (The 
regulations in this part establish such minimum levels for wages, terms, 
benefits, and conditions of employment.) Second, the wages, terms, 
benefits, and conditions offered and afforded to the aliens must be 
compared to the established minimum levels. If it is concluded that 
adverse effect would result, the ultimate determination of availability 
within the meaning of the INA cannot be made since U.S. workers cannot 
be expected to accept employment under conditions below the established 
minimum levels. Florida Sugar Cane League, Inc. v. Usery, 531 F. 2d 299 
(5th Cir. 1976).

Once a determination of no adverse effect has been made, the 
availability of U.S. workers can be tested only if U.S. workers are 
actively recruited through the offer of wages, terms, benefits, and 
conditions at least at the minimum level or the level offered to the 
aliens, whichever is higher. The regulations in this part set forth 
requirements for recruiting U.S. workers in accordance with this 
principle.
    (3) Construction. This part and its subparts shall be construed to 
effectuate the purpose of the INA that U.S. workers rather than aliens 
be employed wherever possible. Elton Orchards, Inc. v. Brennan, 508 F. 
2d 493, 500 (1st Cir. 1974), Flecha v. Quiros, 567 F. 2d 1154 (1st Cir. 
1977). Where temporary alien workers are admitted, the terms and 
conditions of their employment must not result in a lowering of the 
terms and conditions of domestic workers similarly employed, Williams v. 
Usery, 531 F. 2d 305 (5th Cir. 1976); Florida Sugar Cane League, Inc. v. 
Usery, 531 F. 2d 299 (5th Cir. 1976), and the job benefits extended to 
any U.S. workers shall be at least those extended to the alien workers.

[[Page 474]]

    (b) Subparts D and E. Subparts D and E of this part set forth the 
process by which health care facilities can file attestations with the 
Department of Labor for the purpose of employing or otherwise using 
nonimmigrant registered nurses under H-1A visas.
    (c) Subparts F and G. Subparts F and G of this part set forth the 
process by which employers can file attestations with the Department of 
Labor for the purpose of employing alien crewmembers in longshore work 
under D-visas and enforcement provisions relating thereto.
    (d) Subparts H and I of this part. Subpart H of this part sets forth 
the process by which employers can file labor condition applications 
(LCAs) with, and the requirements for obtaining approval from, the 
Department of Labor to temporarily employ the following three categories 
of nonimmigrants in the United States: (1) H-1B visas for temporary 
employment in specialty occupations or as fashion models of 
distinguished merit and ability; (2) H-1B1 visas for temporary 
employment in specialty occupations of nonimmigrant professionals from 
countries with which the United States has entered into certain 
agreements identified in section 214(g)(8)(A) of the INA; and (3) E-3 
visas for nationals of the Commonwealth of Australia for temporary 
employment in specialty occupations. Subpart I of this part establishes 
the enforcement provisions that apply to the H-1B, H-1B1, and E-3 visa 
programs.
    (e) Subparts J and K of this part. Subparts J and K of this part set 
forth the process by which employers can file attestations with the 
Department of Labor for the purpose of employing nonimmigrant alien 
students on F-visas in off-campus employment and enforcement provisions 
relating thereto.

[43 FR 10312, Mar. 10, 1978, as amended at 52 FR 20507, June 1, 1987; 55 
FR 50510, Dec. 6, 1990; 56 FR 24667, May 30, 1991; 56 FR 54738, Oct. 22, 
1991; 56 FR 56875, Nov. 6, 1991; 57 FR 1337, Jan. 13, 1992; 57 FR 40989, 
Sept. 8, 1992; 69 FR 68226, Nov. 23, 2004; 73 FR 19947, Apr. 11, 2008]



Sec.  655.00  Authority of the Office of Foreign Labor Certification
(OFLC) Administrator under subparts A, B, and C.

    Pursuant to the regulations under this part, temporary labor 
certification determinations under subparts A, B, and C of this part are 
ordinarily made by the Office of Foreign Labor Certification (OFLC) 
Administrator (OFLC Administrator) of the Employment and Training 
Administration. The OFLC Administrator will informally advise the 
employer or agent of the name of the official who will make 
determinations with respect to the application.

[71 FR 35518, June 21, 2006]



 Subpart A_Labor Certification Process and Enforcement of Attestations 
   for Temporary Employment in Occupations Other Than Agriculture or 
         Registered Nursing in the United States (H	2B Workers)

    Source: 73 FR 78052, Dec. 19, 2008, unless otherwise noted.



Sec.  655.1  Purpose and scope of subpart A.

    This subpart sets forth the procedures governing the labor 
certification process for the temporary employment of nonimmigrant 
foreign workers in the United States (U.S.) in occupations other than 
agriculture or registered nursing.

[75 FR 6959, Feb. 12, 2010]

    Effective Date Note: At 77 FR 10148, Feb. 21, 2012,Sec. 655.1 was 
revised, effective Apr. 23, 2012. For the convenience of the user, the 
revised text is set forth as follows:



Sec.  655.1  Scope and purpose of subpart A.

    The Immigration and Nationality Act (INA) at 8 U.S.C. 1184(c)(1) 
requires the Secretary of the Department of Homeland Security (DHS) to 
consult with appropriate agencies before authorizing the entry of H-2B 
workers. DHS regulations at 8 CFR 214.2(h)(6)(iv) provide that an 
employer's petition to employ nonimmigrant workers on H-2B visas for 
temporary non-agricultural employment in the United States (U.S.), 
except for Guam, must be accompanied by an approved temporary labor 
certification from the Secretary of Labor (Secretary).

[[Page 475]]

    (a) Purpose. The temporary labor certification reflects a 
determination by the Secretary that:
    (1) There are not sufficient U.S. workers who are qualified and who 
will be available to perform the temporary services or labor for which 
an employer desires to hire foreign workers, and that
    (2) The employment of the H-2B worker(s) will not adversely affect 
the wages and working conditions of U.S. workers similarly employed.
    (b) Scope. This subpart sets forth the procedures governing the 
labor certification process for the temporary employment of nonimmigrant 
foreign workers in the H-2B visa category, as defined in 8 U.S.C. 
1101(a)(15)(H)(ii)(b). It also establishes obligations with respect to 
the terms and conditions of the temporary labor certification with which 
H-2B employers must comply, as well as their obligations to H-2B workers 
and workers in corresponding employment. Additionally, this subpart sets 
forth integrity measures for ensuring employers' continued compliance 
with the terms and conditions of the temporary labor certification.



Sec.  655.2  Territory of Guam.

    Subpart A of this part does not apply to temporary employment in the 
Territory of Guam, and the Department of Labor (Department or DOL) does 
not certify to the USCIS of DHS the temporary employment of nonimmigrant 
foreign workers under H-2B visas, or enforce compliance with the 
provisions of the H-2B visa program provisions in the Territory of Guam. 
Pursuant to DHS regulations, 8 CFR 214.2(h)(6)(v) administration of the 
H-2B temporary labor certification program is performed by the Governor 
of Guam, or the Governor's designated representative.

    Effective Date Note: At 77 FR 10148, Feb. 21, 2012,Sec. 655.2 was 
revised, effective Apr. 23, 2012. For the convenience of the user, the 
revised text is set forth as follows:



Sec.  655.2  Authority of the agencies, offices, and divisions in the 
          Department of Labor.

    (a) Authority and role of the Office of Foreign Labor Certification 
(OFLC). The Secretary has delegated her authority to make determinations 
under this subpart, pursuant to 8 CFR 214.2(h)(6)(iv), to the Assistant 
Secretary for the Employment and Training Administration (ETA), who in 
turn has delegated that authority to OFLC. Determinations on an 
Application for Temporary Employment Certification in the H-2B program 
are made by the Administrator, OFLC who, in turn, may delegate this 
responsibility to designated staff members, e.g., a Certifying Officer 
(CO).
    (b) Authority of the Wage and Hour Division (WHD). Pursuant to its 
authority under the INA, 8 U.S.C. 1184(c)(14)(B), DHS has delegated to 
the Secretary certain investigatory and law enforcement functions with 
respect to terms and conditions of employment in the H-2B program. The 
Secretary has, in turn, delegated that authority to WHD. The regulations 
governing WHD investigation and enforcement functions, including those 
related to the enforcement of temporary labor certifications, issued 
under this subpart, may be found in 29 CFR part 503.
    (c) Concurrent authority. OFLC and WHD have concurrent authority to 
impose a debarment remedy underSec. 655.73 or under 29 CFR 503.24.



Sec.  655.3  Special procedures.

    (a) Systematic process. This subpart provides procedures for the 
processing of H-2B applications from employers for the certification of 
employment of nonimmigrant positions in nonagricultural employment.
    (b) Establishment of special procedures. The Office of Foreign Labor 
Certification (OFLC) Administrator has the authority to establish or to 
devise, continue, revise, or revoke special procedures in the form of 
variances for the processing of certain H-2B applications when employers 
can demonstrate, upon written application to the OFLC Administrator, 
that special procedures are necessary. These include special procedures 
currently in effect for the handling of applications for tree planters 
and related reforestation workers, professional athletes, boilermakers 
coming to the U.S. on an emergency basis, and professional entertainers. 
Prior to making determinations under this paragraph (b), the OFLC 
Administrator may consult with employer and worker representatives.

    Effective Date Note: At 77 FR 10148, Feb. 21, 2012,Sec. 655.3 was 
revised, effective Apr. 23, 2012. For the convenience of the user, the 
revised text is set forth as follows:



Sec.  655.3  Territory of Guam.

    Subpart A of this part does not apply to temporary employment in the 
Territory of Guam, except that an employer seeking certification for a 
job opportunity on Guam must obtain a prevailing wage from the 
Department in accordance withSec. 655.10 of this subpart. The U.S. 
Department of Labor (Department or DOL) does not certify to the

[[Page 476]]

United States Citizenship and Immigration Services (USCIS) of DHS the 
temporary employment of nonimmigrant foreign workers under H-2B visas, 
or enforce compliance with the provisions of the H-2B visa program, in 
the Territory of Guam. Under DHS regulations, administration of the H-2B 
temporary labor certification program is undertaken by the Governor of 
Guam, or the Governor's designated representative.



Sec.  655.4  Definitions of terms used in this subpart.

    For the purposes of this subpart:
    Act means the Immigration and Nationality Act or INA, as amended, 8 
U.S.C. 1101 et seq.
    Administrative Law Judge means a person within the Department's 
Office of Administrative Law Judges appointed pursuant to 5 U.S.C. 3105, 
or a panel of such persons designated by the Chief Administrative Law 
Judge from the Board of Alien Labor Certification Appeals established by 
part 656 of this chapter, which will hear and decide appeals as set 
forth inSec. 655.115.
    Administrator, Office of Foreign Labor Certification (OFLC) means 
the primary official of the Office of Foreign Labor Certification, ETA, 
or the Administrator's designee.
    Administrator, Wage and Hour Division (WHD), Employment Standards 
Administration means the primary official of the WHD, or the 
Administrator's designee.
    Agent means a legal entity or person authorized to act on behalf of 
the employer for temporary non-agricultural labor certification purposes 
that is not itself an employer as defined in this subpart. The term 
``agent''' specifically excludes associations or other organizations of 
employers.
    Applicant means a lawful U.S. worker who is applying for a job 
opportunity for which an employer has filed an Application for Temporary 
Employment Certification (Form ETA 9142).
    Application for Temporary Employment Certification means the Office 
of Management and Budget (OMB)-approved form submitted by an employer to 
secure a temporary nonagricultural labor certification determination 
from DOL. A complete submission of the Application for Temporary 
Employment Certification includes the form, all valid wage 
determinations as required bySec. 655.101(a)(1) and the U.S. worker 
recruitment report.
    Area of Intended Employment means the geographic area within normal 
commuting distance of the place (worksite address) of intended 
employment of the job opportunity for which the certification is sought. 
There is no rigid measure of distance which constitutes a normal 
commuting distance or normal commuting area, because there may be widely 
varying factual circumstances among different areas (e.g., average 
commuting times, barriers to reaching the worksite, quality of regional 
transportation network, etc.). If the place of intended employment is 
within a Metropolitan Statistical Area (MSA), including a multistate 
MSA, any place within the MSA is deemed to be within normal commuting 
distance of the place of intended employment. The borders of MSAs are 
not controlling in the identification of the normal commuting area; a 
location outside of an MSA may be within normal commuting distance of a 
location that is inside (e.g., near the border of) the MSA.
    Attorney means any person who is currently a member in good standing 
of the bar of the highest court of any State, possession, territory, or 
commonwealth of the United States, or the District of Columbia, and who 
is not under suspension, debarment or disbarment from practice before 
any court or the Department, the Board of Immigration Appeals, the 
immigration judges, or DHS under 8 CFR 292.3, 1003.101. Such a person is 
permitted to act as an agent or attorney for an employer under this 
subpart.
    Board of Alien Labor Certification Appeals (BALCA or Board) means 
the permanent Board established by part 656 of this chapter, chaired by 
the Chief Administrative Law Judge, and consisting of Administrative Law 
Judges assigned to the Department and designated by the Chief 
Administrative Law Judge to be members of BALCA. The Board is located in 
Washington, DC, and reviews and decides appeals in Washington, DC.
    Center Director means the OFLC official to whom the OFLC 
Administrator

[[Page 477]]

has delegated his authority for purposes of National Processing Center 
(NPC) operations and functions.
    Certifying Officer (CO) means the OFLC official designated by the 
Administrator, OFLC with making programmatic determinations on employer-
filed applications under the H-2B program.
    Chief Administrative Law Judge means the chief official of the 
Department's Office of Administrative Law Judges or the Chief 
Administrative Law Judge's designee.
    Date of need means the first date the employer requires services of 
the H-2B workers as listed on the application.
    Department of Homeland Security (DHS) means the Federal agency 
having jurisdiction over certain immigration-related functions, acting 
through its agencies, including the U.S. Citizenship and Immigration 
Services.
    Eligible worker means an individual who is not an unauthorized alien 
(as defined in sec. 274A(h)(3) of the INA, 8 U.S.C. 1324a(h)(3), or in 
this paragraph (c)) with respect to the employment in which the worker 
is engaging.
    Employee means employee as defined under the general common law of 
agency. Some of the factors relevant to the determination of employee 
status include: The hiring party's right to control the manner and means 
by which the work is accomplished; the skill required to perform the 
work; the source of the instrumentalities and tools for accomplishing 
the work; the location of the work; the hiring party's discretion over 
when and how long to work; and whether the work is part of the regular 
business of the hiring party. Other applicable factors should be 
considered and no one factor is dispositive.
    Employer means:
    (1) A person, firm, corporation or other association or 
organization:
    (i) Has a place of business (physical location) in the U.S. and a 
means by which it may be contacted;
    (ii) Has an employer relationship with respect to H-2B employees or 
related U.S. workers under this part; and
    (iii) Possesses, for purposes of the filing of an application, a 
valid Federal Employer Identification Number (FEIN).
    (2) Where two or more employers each have the definitional indicia 
of employment with respect to an employee, those employers may be 
considered to jointly employ that employee.
    Employment and Training Administration or ETA means the agency 
within the Department, which includes the OFLC and has been delegated 
authority by the Secretary to fulfill the Secretary's mandate under the 
Act.
    ETA National Processing Center (NPC) means a National Processing 
Center established by the OFLC for the processing of applications 
submitted in connection with the Department's mandate pursuant to the 
INA.
    Full-time, for purposes of temporary labor certification employment, 
means 30 or more hours per week, except that where a State or an 
established practice in an industry has developed a definition of full-
time employment for any occupation that is less than 30 hours per week, 
that definition shall have precedence.
    H-2B Petition means the form and accompanying documentation required 
by DHS for employers seeking to employ foreign persons as H-2B 
nonimmigrant workers.
    INA means the Immigration and Nationality Act, as amended, 8 U.S.C. 
1101 et seq.
    Job contractor means a person, association, firm, or a corporation 
that meets the definition of an employer and who contracts services or 
labor on a temporary basis to one or more employers, which is not an 
affiliate, branch or subsidiary of the job contractor, and where the job 
contractor will not exercise any supervision or control in the 
performance of the services or labor to be performed other than hiring, 
paying, and firing the workers.
    Job opportunity means one or more job openings with the petitioning 
employer for temporary employment at a place in the U.S. to which U.S. 
workers can be referred. Job opportunities consisting solely of job 
duties that will be performed totally outside the United States, its 
territories, possessions, or commonwealths cannot be the subject of an 
Application for Temporary Employment Certification.

[[Page 478]]

    Joint employment means that where two or more employers each have 
sufficient definitional indicia of employment to be considered the 
employer of an employee, those employers may be considered to jointly 
employ that employee. An employer in a joint employment relationship to 
an employee may be considered a ``joint employer'' of that employee.
    Layoff means any involuntary separation of one or more U.S. 
employees without cause or prejudice.
    Metropolitan Statistical Area (MSA) means those geographic entities 
defined by the U.S. Office of Management and Budget (OMB) for use by 
Federal statistical agencies in collecting, tabulating, and publishing 
Federal statistics. A metro area contains a core urban area of 50,000 or 
more population, and a micro area contains an urban core of at least 
10,000 (but less than 50,000) population. Each metro or micro area 
consists of one or more counties and includes the counties containing 
the core urban area, as well as any adjacent counties that have a high 
degree of social and economic integration (as measured by commuting to 
work) with the urban core.
    Offered wage means the highest of the prevailing wage, Federal 
minimum wage, the State minimum wage, or local minimum wage.
    Office of Foreign Labor Certification (OFLC) means the 
organizational component within ETA that provides national leadership 
and policy guidance and develops regulations and procedures by which it 
carries out the responsibilities of the Secretary under the INA, as 
amended, concerning foreign workers seeking admission to the U.S. in 
order to work under sec. 101(a)(15)(H)(ii)(b) of the INA, as amended.
    Occupational Employment Statistics Survey (OES) means that program 
under the jurisdiction of the Bureau of Labor Statistics (BLS) that 
provides annual wage estimates for occupations at the State and MSA 
levels.
    Prevailing Wage Determination (PWD) means the prevailing wage for 
the position, as described inSec. 655.10(b), that is the subject of 
the Application for Temporary Employment Certification.
    Professional athlete shall have the meaning ascribed to it in INA 
sec. 212(a)(5)(A)(iii)(II), which defines ``professional athlete'' as an 
individual who is employed as an athlete by:
    (1) A team that is a member of an association of six or more 
professional sports teams whose total combined revenues exceed 
$10,000,000 per year, if the association governs the conduct of its 
members and regulates the contests and exhibitions in which its member 
teams regularly engage; or
    (2) Any minor league team that is affiliated with such an 
association.
    Representative means an individual employed by or authorized to act 
on behalf of the employer with respect to the recruitment activities 
entered into for and attestations made with respect to the Application 
for Temporary Employment Certification. A representative who interviews 
and/or considers U.S. workers for the job that is subject of the 
Application must be the person who normally interviews or considers, on 
behalf of the employer, applicants for job opportunities such as that 
offered in the application, but which do not involve labor 
certifications.
    Secretary means the Secretary of Labor, the chief official of the 
U.S. Department of Labor, or the Secretary's designee.
    Secretary of Homeland Security means the chief official of the 
Department of Homeland Security or the Secretary of Homeland Security's 
designee.
    Secretary of State means the chief official of the U.S. Department 
of State or the Secretary of State's designee.
    State Workforce Agency (SWA), formerly known as State Employment 
Security Agency, means the State government agency that receives funds 
pursuant to the Wagner-Peyser Act to administer public labor exchange 
delivered through the State's one-stop delivery system in accordance 
with the Wagner-Peyser Act. (29 U.S.C. 49 et seq.).
    Strike means a labor dispute wherein employees engage in a concerted 
stoppage of work (including stoppage by reason of the expiration of a 
collective-bargaining agreement) or engage in any concerted slowdown or 
other concerted interruption of operations. Whether a job opportunity is 
vacant by

[[Page 479]]

reason of a strike or lock out will be determined by evaluating for each 
position identified as vacant in the Application for Temporary 
Employment Certification whether the specific vacancy has been caused by 
the strike or lock out.
    Successor in interest means that, in determining whether an employer 
is a successor in interest, the factors used under Title VII of the 
Civil Rights Act and the Vietnam Era Veterans' Readjustment Assistance 
Act will be considered. When considering whether an employer is a 
successor, the primary consideration will be the personal involvement of 
the firm's ownership, management, supervisors, and others associated 
with the firm in the violations resulting in debarment. Normally, wholly 
new management or ownership of the same business operation, one in which 
the former management or owner does not retain a direct or indirect 
interest, will not be deemed to be a successor in interest for purposes 
of debarment. A determination of whether or not a successor in interest 
exists is based on the entire circumstances viewed in their totality. 
The factors to be considered include:
    (1) Substantial continuity of the same business operations;
    (2) Use of the same facilities;
    (3) Continuity of the work force;
    (4) Similarity of jobs and working conditions;
    (5) Similarity of supervisory personnel;
    (6) Similarity in machinery, equipment, and production methods;
    (7) Similarity of products and services; and
    (8) The ability of the predecessor to provide relief.
    United States (U.S.), when used in a geographic sense, means the 
continental United States, Alaska, Hawaii, the Commonwealth of Puerto 
Rico, and the territories of Guam, the Virgin Islands, and, as of the 
transition program effective date, as defined in the Consolidated 
Natural Resources Act of 2008, Public Law 110-229, Title VII, the 
Commonwealth of the Northern Mariana Islands.
    United States Citizenship and Immigration Services (USCIS) means the 
Federal agency within DHS making the determination under the INA whether 
to grant petitions filed by employers seeking H-2B workers to perform 
temporary nonagricultural work in the U.S.
    United States worker (U.S. worker) means a worker who is either
    (1) A citizen or national of the U.S.; or
    (2) An alien who is lawfully admitted for permanent residence in the 
U.S., is admitted as a refugee under sec. 207 of the INA, is granted 
asylum under sec. 208 of the INA, or is an immigrant otherwise 
authorized (by the INA or by DHS) to be employed in the U.S.
    Within [number and type] days will, for purposes of determining an 
employer's compliance with timing requirements with respect to appeals 
and requests for review, begin to run on the first business day after 
the Department sends a notice to the employer by means normally assuring 
next-day delivery, and will end on the day that the employer sends 
whatever communication is required by these rules back to the 
Department, as evidenced by a postal mark or other similar receipt.

    Effective Date Note: At 77 FR 10148, Feb. 21, 2012,Sec. 655.4 was 
revised, effective Apr. 23, 2012. For the convenience of the user, the 
revised text is set forth as follows:



Sec.  655.4  Special procedures.

    To provide for a limited degree of flexibility in carrying out the 
Secretary's responsibilities, the Administrator, OFLC has the authority 
to establish, continue, revise, or revoke special procedures in the form 
of variances for processing certain H-2B applications. Employers must 
request and demonstrate in writing to the Administrator, OFLC that 
special procedures are necessary. Before making determinations under 
this section, the Administrator, OFLC may consult with affected 
employers and worker representatives. Special procedures in place on the 
effective date of this regulation, including special procedures 
currently in effect for handling applications for tree planters and 
related reforestation workers, professional athletes, boilermakers 
coming to the U.S. on an emergency basis, and professional entertainers, 
will remain in force until modified or withdrawn by the Administrator, 
OFLC.



Sec.  655.5  Purpose and scope of subpart A.

    (a) Before granting the petition of an employer to admit 
nonimmigrant workers on H-2B visas for temporary nonagricultural 
employment in the

[[Page 480]]

United States (U.S.), the Secretary of Homeland Security is required to 
consult with appropriate agencies regarding the availability of U.S. 
workers. Immigration and Nationality Act of 1952 (INA), as amended, 
secs. 101(a)(15)(H)(ii)(b) and 214(c)(1), 8 U.S.C. 1101(a)(15)(H)(ii)(b) 
and 1184(c)(1).
    (b) Regulations of the Department of Homeland Security (DHS) for the 
U.S. Citizenship and Immigration Services (USCIS) at 8 CFR 
214.2(h)(6)(iv) require that, except for Guam, the petitioning H-2B 
employer attach to its petition a determination from the Secretary of 
Labor (Secretary) that:
    (1) There are not sufficient U.S. workers available who are capable 
of performing the temporary services or labor at the time of filing of 
the petition for H-2B classification and at the place where the foreign 
worker is to perform the work; and
    (2) The employment of the foreign worker will not adversely affect 
the wages and working conditions of U.S. workers similarly employed.
    (c) This subpart sets forth the procedures governing the labor 
certification process for the temporary employment of nonimmigrant 
foreign workers in the U.S. in occupations other than agriculture and 
registered nursing.
    (1) This subpart sets forth the procedures through which employers 
may apply for H-2B labor certifications, as well as the procedures by 
which such applications are considered and how they are granted or 
denied.
    (2) This subpart sets forth the procedures governing the 
Department's investigatory, inspection, and law enforcement functions to 
assure compliance with the terms and conditions of employment under the 
H-2B program. The authority for such functions has been delegated by the 
Secretary of Homeland Security to the Secretary of Labor and re-
delegated within the Department to the Employment Standards 
Administration (ESA) Wage and Hour Division (WHD). This subpart sets 
forth the WHD's investigation and enforcement actions.

[73 FR 78052, Dec. 19, 2008. Redesignated at 74 FR 25985, May 29, 2009]

    Effective Date Note: At 74 FR 25985, May 29, 2009,Sec. 655.1 was 
redesignated asSec. 655.5 and suspended, effective June 29, 2009.

    Effective Date Note: At 77 FR 10148, Feb. 21, 2012,Sec. 655.5 was 
revised, effective Apr. 23, 2012. For the convenience of the user, the 
revised text is set forth as follows:



Sec.  655.5  Definition of terms.

    For purposes of this subpart:
    Act means the Immigration and Nationality Act or INA, as amended, 8 
U.S.C. 1101 et seq.
    Administrative Law Judge (ALJ) means a person within the 
Department's Office of Administrative Law Judges appointed under 5 
U.S.C. 3105.
    Administrator, Office of Foreign Labor Certification (OFLC) means 
the primary official of the Office of Foreign Labor Certification, ETA, 
or the Administrator's designee.
    Administrator, Wage and Hour Division (WHD) means the primary 
official of the WHD, or the Administrator's designee.
    Agent. (1) Agent means a legal entity or person who:
    (i) Is authorized to act on behalf of an employer for temporary 
nonagricultural labor certification purposes;
    (ii) Is not itself an employer, or a joint employer, as defined in 
this part with respect to a specific application; and
    (iii) Is not an association or other organization of employers.
    (2) No agent who is under suspension, debarment, expulsion, 
disbarment, or otherwise restricted from practice before any court, the 
Department, the Executive Office for Immigration Review under 8 CFR 
1003.101, or DHS under 8 CFR 292.3 may represent an employer under this 
part.
    Agricultural labor or services means those duties and occupations 
defined in subpart B of this part.
    Applicant means a U.S. worker who is applying for a job opportunity 
for which an employer has filed an Application for Temporary Employment 
Certification (ETA Form 9142 and the appropriate appendices).
    Application for Temporary Employment Certification means the Office 
of Management and Budget (OMB)-approved ETA Form 9142 and the 
appropriate appendices, a valid wage determination, as required bySec. 
655.10, and a subsequently-filed U.S. worker recruitment report, 
submitted by an employer to secure a temporary labor certification 
determination from DOL.
    Area of intended employment means the geographic area within normal 
commuting distance of the place (worksite address) of the job 
opportunity for which the certification is sought. There is no rigid 
measure of distance that constitutes a normal commuting distance or 
normal commuting area, because there may be widely varying factual 
circumstances among different areas (e.g., average commuting times, 
barriers to reaching the worksite, or quality of the regional

[[Page 481]]

transportation network). If the place of intended employment is within a 
Metropolitan Statistical Area (MSA), including a multistate MSA, any 
place within the MSA is deemed to be within normal commuting distance of 
the place of intended employment. The borders of MSAs are not 
controlling in the identification of the normal commuting area; a 
location outside of an MSA may be within normal commuting distance of a 
location that is inside (e.g., near the border of) the MSA.
    Area of substantial unemployment means a contiguous area with a 
population of at least 10,000 in which there is an average unemployment 
rate equal to or exceeding 6.5 percent for the 12 months preceding the 
determination of such areas made by the ETA.
    Attorney means any person who is a member in good standing of the 
bar of the highest court of any State, possession, territory, or 
commonwealth of the U.S., or the District of Columbia. No attorney who 
is under suspension, debarment, expulsion, disbarment, or otherwise 
restricted from practice before any court, the Department, the Executive 
Office for Immigration Review under 8 CFR 1003.101, or DHS under 8 CFR 
292.3 may represent an employer under this subpart.
    Board of Alien Labor Certification Appeals (BALCA or Board) means 
the permanent Board established by part 656 of this chapter, chaired by 
the Chief Administrative Law Judge (Chief ALJ), and consisting of ALJs 
assigned to the Department and designated by the Chief ALJ to be members 
of BALCA.
    Certifying Officer (CO) means an OFLC official designated by the 
Administrator, OFLC to make determinations on applications under the H-
2B program. The Administrator, OFLC is the National CO. Other COs may 
also be designated by the Administrator, OFLC to make the determinations 
required under this subpart.
    Chief Administrative Law Judge (Chief ALJ) means the chief official 
of the Department's Office of Administrative Law Judges or the Chief 
Administrative Law Judge's designee.
    Corresponding employment. (1) Corresponding employment means the 
employment of workers who are not H-2B workers by an employer that has a 
certified H-2B Application for Temporary Employment Certification when 
those workers are performing either substantially the same work included 
in the job order or substantially the same work performed by the H-2B 
workers, except that workers in the following two categories are not 
included in corresponding employment:
    (i) Incumbent employees continuously employed by the H-2B employer 
to perform substantially the same work included in the job order or 
substantially the same work performed by the H-2B workers during the 52 
weeks prior to the period of employment certified on the Application for 
Temporary Employment Certification and who have worked or been paid for 
at least 35 hours in at least 48 of the prior 52 workweeks, and who have 
worked or been paid for an average of at least 35 hours per week over 
the prior 52 weeks, as demonstrated on the employer's payroll records, 
provided that the terms and working conditions of their employment are 
not substantially reduced during the period of employment covered by the 
job order. In determining whether this standard was met, the employer 
may take credit for any hours that were reduced by the employee 
voluntarily choosing not to work due to personal reasons such as illness 
or vacation; or
    (ii) Incumbent employees covered by a collective bargaining 
agreement or an individual employment contract that guarantees both an 
offer of at least 35 hours of work each workweek and continued 
employment with the H-2B employer at least through the period of 
employment covered by the job order, except that the employee may be 
dismissed for cause.
    (2) To qualify as corresponding employment, the work must be 
performed during the period of the job order, including any approved 
extension thereof.
    Date of need means the first date the employer requires services of 
the H-2B workers as listed on the Application for Temporary Employment 
Certification.
    Department of Homeland Security (DHS) means the Federal Department 
having jurisdiction over certain immigration-related functions, acting 
through its agencies, including USCIS.
    Employee means a person who is engaged to perform work for an 
employer, as defined under the general common law. Some of the factors 
relevant to the determination of employee status include: the hiring 
party's right to control the manner and means by which the work is 
accomplished; the skill required to perform the work; the source of the 
instrumentalities and tools for accomplishing the work; the location of 
the work; the hiring party's discretion over when and how long to work; 
and whether the work is part of the regular business of the hiring 
party. Other applicable factors may be considered and no one factor is 
dispositive. The terms employee and worker are used interchangeably in 
this subpart.
    Employer means a person (including any individual, partnership, 
association, corporation, cooperative, firm, joint stock company, trust, 
or other organization with legal rights and duties) that:
    (1) Has a place of business (physical location) in the U.S. and a 
means by which it may be contacted for employment;
    (2) Has an employer relationship (such as the ability to hire, pay, 
fire, supervise or otherwise control the work of employees) with respect 
to an H-2B worker or a worker in corresponding employment; and

[[Page 482]]

    (3) Possesses, for purposes of filing an Application for Temporary 
Employment Certification, a valid Federal Employer Identification Number 
(FEIN).
    Employer-client means an employer that has entered into an agreement 
with a job contractor and that is not an affiliate, branch or subsidiary 
of the job contractor, under which the job contractor provides services 
or labor to the employer on a temporary basis and will not exercise 
substantial, direct day-to-day supervision and control in the 
performance of the services or labor to be performed other than hiring, 
paying and firing the workers.
    Employment and Training Administration (ETA) means the agency within 
the Department which includes OFLC and has been delegated authority by 
the Secretary to fulfill the Secretary's mandate under the DHS 
regulations for the administration and adjudication of an Application 
for Temporary Employment Certification and related functions.
    Federal holiday means a legal public holiday as defined at 5 U.S.C. 
6103.
    Full-time means 35 or more hours of work per week.
    H-2B Petition means the DHS Petition for a Nonimmigrant Worker form, 
or successor form, and accompanying documentation required by DHS for 
employers seeking to employ foreign persons as H-2B nonimmigrant 
workers. The H-2B Petition includes the approved Application for 
Temporary Employment Certification and the Final Determination letter.
    H-2B Registration means the OMB-approved ETA Form 9155, submitted by 
an employer to register its intent to hire H-2B workers and to file an 
Application for Temporary Employment Certification.
    H-2B worker means any temporary foreign worker who is lawfully 
present in the U.S. and authorized by DHS to perform nonagricultural 
labor or services of a temporary or seasonal nature under 8 U.S.C. 
1101(a)(15)(H)(ii)(b).
    Job contractor means a person, association, firm, or a corporation 
that meets the definition of an employer and that contracts services or 
labor on a temporary basis to one or more employers, which is not an 
affiliate, branch or subsidiary of the job contractor and where the job 
contractor will not exercise substantial, direct day-to-day supervision 
and control in the performance of the services or labor to be performed 
other than hiring, paying and firing the workers.
    Job offer means the offer made by an employer or potential employer 
of H-2B workers to both U.S. and H-2B workers describing all the 
material terms and conditions of employment, including those relating to 
wages, working conditions, and other benefits.
    Job opportunity means one or more openings for full-time employment 
with the petitioning employer within a specified area(s) of intended 
employment for which the petitioning employer is seeking workers.
    Job order means the document containing the material terms and 
conditions of employment relating to wages, hours, working conditions, 
worksite and other benefits, including obligations and assurances under 
29 CFR part 503 and this subpart that is posted between and among the 
State Workforce Agencies (SWAs) on their job clearance systems.
    Joint employment means that where two or more employers each have 
sufficient definitional indicia of being an employer to be considered 
the employer of a worker, those employers will be considered to jointly 
employ that worker. Each employer in a joint employment relationship to 
a worker is considered a joint employer of that worker.
    Layoff means any involuntary separation of one or more U.S. 
employees without cause.
    Metropolitan Statistical Area (MSA) means a geographic entity 
defined by OMB for use by Federal statistical agencies in collecting, 
tabulating, and publishing Federal statistics. A metro area contains a 
core urban area of 50,000 or more population, and a micro area contains 
an urban core of at least 10,000 (but fewer than 50,000) population. 
Each metro or micro area consists of one or more counties and includes 
the counties containing the core urban area, as well as any adjacent 
counties that have a high degree of social and economic integration (as 
measured by commuting to work) with the urban core.
    National Prevailing Wage Center (NPWC) means that office within OFLC 
from which employers, agents, or attorneys who wish to file an 
Application for Temporary Employment Certification receive a prevailing 
wage determination (PWD).
    NPWC Director means the OFLC official to whom the Administrator, 
OFLC has delegated authority to carry out certain NPWC operations and 
functions.
    National Processing Center (NPC) means the office within OFLC which 
is charged with the adjudication of an Application for Temporary 
Employment Certification or other applications. For purposes of this 
subpart, the NPC receiving a request for an H-2B Registration and an 
Application for Temporary Employment Certification is the Chicago NPC 
whose address is published in the Federal Register.
    NPC Director means the OFLC official to whom the Administrator, OFLC 
has delegated authority for purposes of certain Chicago NPC operations 
and functions.
    Non-agricultural labor and services means any labor or services not 
considered to be agricultural labor or services as defined in subpart B 
of this part. It does not include the provision of services as members 
of the medical profession by graduates of medical schools.

[[Page 483]]

    Occupational employment statistics (OES) survey means the program 
under the jurisdiction of the Bureau of Labor Statistics (BLS) that 
provides annual wage estimates for occupations at the State and MSA 
levels.
    Offered wage means the wage offered by an employer in an H-2B job 
order. The offered wage must equal or exceed the highest of the 
prevailing wage or Federal, State or local minimum wage.
    Office of Foreign Labor Certification (OFLC) means the 
organizational component of the ETA that provides national leadership 
and policy guidance and develops regulations to carry out the 
Secretary's responsibilities for the admission of foreign workers to the 
U.S. to perform work described in 8 U.S.C. 1101(a)(15)(H)(ii)(b).
    Prevailing wage determination (PWD) means the prevailing wage for 
the position, as described inSec. 655.10, that is the subject of the 
Application for Temporary Employment Certification. The PWD is made on 
ETA Form 9141, Application for Prevailing Wage Determination.
    Professional athlete is defined in 8 U.S.C. 1182(a)(5)(A)(iii)(II), 
and means an individual who is employed as an athlete by:
    (1) A team that is a member of an association of six or more 
professional sports teams whose total combined revenues exceed 
$10,000,000 per year, if the association governs the conduct of its 
members and regulates the contests and exhibitions in which its member 
teams regularly engage; or
    (2) Any minor league team that is affiliated with such an 
association.
    Secretary means the Secretary of Labor, the chief official of the 
U.S. Department of Labor, or the Secretary's designee.
    Secretary of the Department of Homeland Security means the chief 
official of the U.S. Department of Homeland Security (DHS) or the 
Secretary of DHS's designee.
    Secretary of State means the chief official of the U.S. Department 
of State or the Secretary of State's designee.
    State Workforce Agency (SWA) means a State government agency that 
receives funds under the Wagner-Peyser Act (29 U.S.C. 49 et seq.) to 
administer the State's public labor exchange activities.
    Strike means a concerted stoppage of work by employees as a result 
of a labor dispute, or any concerted slowdown or other concerted 
interruption of operation (including stoppage by reason of the 
expiration of a collective bargaining agreement).
    Successor in interest means:
    (1) Where an employer has violated 29 CFR part 503, or this subpart, 
and has ceased doing business or cannot be located for purposes of 
enforcement, a successor in interest to that employer may be held liable 
for the duties and obligations of the violating employer in certain 
circumstances. The following factors, as used under Title VII of the 
Civil Rights Act and the Vietnam Era Veterans' Readjustment Assistance 
Act, may be considered in determining whether an employer is a successor 
in interest; no one factor is dispositive, but all of the circumstances 
will be considered as a whole:
    (i) Substantial continuity of the same business operations;
    (ii) Use of the same facilities;
    (iii) Continuity of the work force;
    (iv) Similarity of jobs and working conditions;
    (v) Similarity of supervisory personnel;
    (vi) Whether the former management or owner retains a direct or 
indirect interest in the new enterprise;
    (vii) Similarity in machinery, equipment, and production methods;
    (viii) Similarity of products and services; and
    (ix) The ability of the predecessor to provide relief.
    (2) For purposes of debarment only, the primary consideration will 
be the personal involvement of the firm's ownership, management, 
supervisors, and others associated with the firm in the violation(s) at 
issue.
    United States (U.S.) means the continental U.S., Alaska, Hawaii, the 
Commonwealth of Puerto Rico, and the territories of Guam, the U.S. 
Virgin Islands, and the Commonwealth of the Northern Mariana Islands 
(CNMI).
    United States Citizenship and Immigration Services (USCIS) means the 
Federal agency within DHS that makes the determination under the INA 
whether to grant petitions filed by employers seeking H-2B workers to 
perform temporary non-agricultural work in the U.S.
    United States worker (U.S. worker) means a worker who is:
    (1) A citizen or national of the U.S.;
    (2) An alien who is lawfully admitted for permanent residence in the 
U.S., is admitted as a refugee under 8 U.S.C. 1157, is granted asylum 
under 8 U.S.C. 1158, or is an immigrant otherwise authorized (by the INA 
or by DHS) to be employed in the U.S.; or
    (3) An individual who is not an unauthorized alien (as defined in 8 
U.S.C. 1324a(h)(3)) with respect to the employment in which the worker 
is engaging.
    Wage and Hour Division (WHD) means the agency within the Department 
with investigatory and law enforcement authority, as delegated from DHS, 
to carry out the provisions under 8 U.S.C. 1184(c).
    Wages mean all forms of cash remuneration to a worker by an employer 
in payment for personal services.



Sec.  655.6  Temporary need.

    (a) To use the H-2B program, the employer must establish that its 
need for nonagricultural services or labor is temporary, regardless of 
whether the

[[Page 484]]

underlying job is permanent or temporary. 8 CFR 214.2(h)(6)(ii).
    (b) The employer's need is considered temporary if justified to the 
Secretary as either a one-time occurrence, a seasonal need, a peakload 
need, or an intermittent need, as defined by the Department of Homeland 
Security. 8 CFR 214.2(h)(6)(ii)(B).
    (c) Except where the employer's need is based on a one-time 
occurrence, the Secretary will, absent unusual circumstances, deny an 
Application for Temporary Employment Certification where the employer 
has a recurring, seasonal or peakload need lasting more than 10 months.
    (d) The temporary nature of the work or services to be performed in 
applications filed by job contractors will be determined by examining 
the job contractor's own need for the services or labor to be performed 
in addition to the needs of each individual employer with whom the job 
contractor has agreed to provide workers as part of a signed work 
contract or labor services agreement.
    (e) The employer filing the application must maintain documentation 
evidencing the temporary need and be prepared to submit this 
documentation in response to a Request for Further Information (RFI) 
from the CO prior to rendering a Final Determination or in the event of 
an audit examination. The documentation required in this section must be 
retained by the employer for a period of no less than 3 years from the 
date of the labor certification.

    Effective Date Note: At 77 FR 10148, Feb. 21, 2012,Sec. 655.6 was 
revised, effective Apr. 23, 2012. For the convenience of the user, the 
revised text is set forth as follows:



Sec.  655.6  Temporary need.

    (a) An employer seeking certification under this subpart must 
establish that its need for non-agricultural services or labor is 
temporary, regardless of whether the underlying job is permanent or 
temporary. 8 CFR 214.2(h)(6)(ii)(A).
    (b) The employer's need is considered temporary if justified to the 
CO as one of the following: A one-time occurrence; a seasonal need; a 
peakload need; or an intermittent need, as defined by DHS. 8 CFR 
214.2(h)(6)(ii)(B). Except where the employer's need is based on a one-
time occurrence, the CO will deny a request for an H-2B Registration or 
an Application for Temporary Employment Certification where the employer 
has a need lasting more than 9 months.
    (c) A job contractor will only be permitted to seek certification if 
it can demonstrate through documentation its own temporary need, not 
that of its employer-client(s). A job contractor will only be permitted 
to file applications based on a seasonal need or a one-time occurrence.



Sec.  655.7  Persons and entities authorized to file.

    (a) Persons authorized to file. In addition to the employer 
applicant, a request for an H-2B Registration or an Application for 
Temporary Employment Certification may be filed by an attorney or agent, 
as defined inSec. 655.5.
    (b) Employer's signature required. Regardless of whether the 
employer is represented by an attorney or agent, the employer is 
required to sign the H-2B Registration and Application for Temporary 
Employment Certification and all documentation submitted to the 
Department.

[77 FR 10151, Feb. 21, 2012]

    Effective Date Note: At 77 FR 10151, Feb. 21, 2012,Sec. 655.7 was 
added, effective Apr. 23, 2012.



Sec.  655.8  Requirements for agents.

    An agent filing an Application for Temporary Employment 
Certification on behalf of an employer must provide:
    (a) A copy of the agent agreement or other document demonstrating 
the agent's authority to represent the employer; and
    (b) A copy of the Migrant and Seasonal Agricultural Worker 
Protection Act (MSPA) Farm Labor Contractor Certificate of Registration, 
if the agent is required under MSPA, at 29 U.S.C. 1801 et seq., to have 
such a certificate, identifying the specific farm labor contracting 
activities the agent is authorized to perform.

[77 FR 10151, Feb. 21, 2012]

    Effective Date Note: At 77 FR 10151, Feb. 21, 2012,Sec. 655.8 was 
added, effective Apr. 23, 2012.



Sec.  655.9  Disclosure of foreign worker recruitment.

    (a) The employer, and its attorney or agent, as applicable, must 
provide a copy of all agreements with any agent or recruiter whom it 
engages or plans

[[Page 485]]

to engage in the international recruitment of H-2B workers under this 
Application for Temporary Employment Certification. These agreements 
must contain the contractual prohibition against charging fees as set 
forth inSec. 655.20(p).
    (b) The employer, and its attorney or agent, as applicable, must 
also provide the identity and location of all persons and entities hired 
by or working for the recruiter or agent referenced in paragraph (a) of 
this section, and any of the agents or employees of those persons and 
entities, to recruit prospective foreign workers for the H-2B job 
opportunities offered by the employer.
    (c) The Department will maintain a publicly available list of agents 
and recruiters who are party to the agreements referenced in paragraph 
(a) of this section, as well as the persons and entities referenced in 
paragraph (b) of this section and the locations in which they are 
operating.

[77 FR 10151, Feb. 21, 2012]

    Effective Date Note: At 77 FR 10151, Feb. 21, 2012,Sec. 655.9 was 
added, effective Apr. 23, 2012.

                          Prefiling Procedures

    Effective Date Note: At 77 FR 10151, Feb. 21, 2012, an undesignated 
center heading was added beforeSec. 655.10, effective Apr. 23, 2012.



Sec.  655.10  Determination of prevailing wage for temporary labor
certification purposes.

    (a) Application process. (1) The employer must request a prevailing 
wage determination from the NPC in accordance with the procedures 
established by this regulation.
    (2) The employer must obtain a prevailing wage determination that is 
valid either on the date recruitment begins or the date of filing a 
complete Application for Temporary Employment Certification with the 
Department.
    (3) The employer must offer and advertise the position to all 
potential workers at a wage at least equal to the prevailing wage 
obtained from the NPC.
    (b) Determinations. Prevailing wages shall be determined as follows:
    (1) Except as provided in paragraph (e) of this section, if the job 
opportunity is covered by a collective bargaining agreement (CBA) that 
was negotiated at arms' length between the union and the employer, the 
wage rate set forth in the CBA is considered as not adversely affecting 
the wages of U.S. workers, that is, it is considered the ``prevailing 
wage'' for labor certification purposes.
    (2) If the job opportunity is not covered by a CBA, the prevailing 
wage for labor certification purposes shall be the arithmetic mean, 
except as provided in paragraph (b)(4) of this section, of the wages of 
workers similarly employed at the skill level in the area of intended 
employment. The wage component of the BLS Occupational Employment 
Statistics Survey (OES) shall be used to determine the arithmetic mean, 
unless the employer provides a survey acceptable to OFLC under paragraph 
(f) of this section.
    (3) If the job opportunity involves multiple worksites within an 
area of intended employment and different prevailing wage rates exist 
for the same opportunity and staff level within the area of intended 
employment, the prevailing wage shall be based on the highest applicable 
wage among all relevant worksites.
    (4) If the employer provides a survey acceptable under paragraph (f) 
of this section that provides a median but does not provide an 
arithmetic mean, the prevailing wage applicable to the employer's job 
opportunity shall be the median of the wages of U.S. workers similarly 
employed in the area of intended employment.
    (5) The employer may use a current wage determination in the area 
determined under the Davis-Bacon Act, 40 U.S.C. 276a et seq., 29 CFR 
part 1, or the McNamara-O'Hara Service Contract Act, 41 U.S.C. 351 et 
seq.
    (6) The NPC will enter its wage determination on the form it uses 
for these purposes, indicate the source, and return the form with its 
endorsement to the employer within 30 days of receipt of the request for 
a prevailing wage determination. The employer must offer this wage (or 
higher) to both its H-2B workers and any similarly employed U.S. worker 
hired in response to the recruitment required as part of the 
application.

[[Page 486]]

    (c) Similarly employed. For purposes of this section, ``similarly 
employed'' means having substantially comparable jobs in the 
occupational category in the area of intended employment, except that, 
if a representative sample of workers in the occupational category 
cannot be obtained in the area of intended employment, similarly 
employed means:
    (1) Having jobs requiring a substantially similar level of 
comparable skills within the area of intended employment; or
    (2) If there are no substantially comparable jobs in the area of 
intended employment, having substantially comparable jobs with employers 
outside of the area of intended employment.
    (d) Validity period. The NPC must specify the validity period of the 
prevailing wage, which in no event may be more than 1 year or less than 
3 months from the determination date. For employment that is less than 
one year in duration, the prevailing wage determination shall apply and 
shall be paid the prevailing wage by the employer, at a minimum, for the 
duration of the employment.
    (e) Professional athletes. In computing the prevailing wage for a 
professional athlete when the job opportunity is covered by professional 
sports league rules or regulations, the wage set forth in those rules or 
regulations is considered the prevailing wage (see sec. 212(p)(2) of the 
INA).
    (f) Employer-provided wage information. (1) If the job opportunity 
is not covered by a CBA, or by a professional sports league's rules or 
regulations, the NPC will consider wage information provided by the 
employer in making a Prevailing Wage Determination. An employer survey 
can be submitted either initially or after NPC issuance of a PWD derived 
from the OES survey.
    (2) In each case where the employer submits a survey or other wage 
data for which it seeks acceptance, the employer must provide specific 
information about the survey methodology, including such items as sample 
size and source, sample selection procedures, and survey job 
descriptions, to allow a determination of the adequacy of the data 
provided and validity of the statistical methodology used in conducting 
the survey in accordance with guidance issued by the OFLC national 
office.
    (3) The survey must be based upon recently collected data:
    (i) Any published survey must have been published within 24 months 
of the date of submission, must be the most current edition of the 
survey, and must be based on data collected not more than 24 months 
before the publication date.
    (ii) A survey conducted by the employer must be based on data 
collected within 24 months of the date it is submitted for 
consideration.
    (4) If the employer-provided survey is found not to be acceptable, 
the NPC shall inform the employer in writing of the reasons the survey 
was not accepted.
    (5) The employer, after receiving notification that the survey it 
provided for consideration is not acceptable, may file supplemental 
information as provided in paragraph (g) of this section, file a new 
request for a PWD, appeal underSec. 655.11, or, if the initial PWD was 
requested prior to submission of the employer survey, acquiesce to the 
initial PWD.
    (g) Submission of supplemental information by employer. (1) If the 
employer disagrees with the wage level assigned to its job opportunity, 
or if the NPC informs the employer its survey is not acceptable, or if 
there is another legitimate basis for such a review, the employer may 
submit supplemental information to the NPC.
    (2) The NPC must consider one supplemental submission relating to 
the employer's survey, the skill level assigned to the job opportunity, 
or any other legitimate basis for the employer to request such a review. 
If the NPC does not accept the employer's survey after considering the 
supplemental information, or affirms its determination concerning the 
skill level, the NPC must inform the employer, in writing, of the 
reasons for its decision.
    (3) The employer may then apply for a new wage determination, appeal 
underSec. 655.11, or acquiesce to the initial PWD.
    (h) The prevailing wage cannot be lower than required by any other 
law. No PWD for labor certification purposes made

[[Page 487]]

under this section permits an employer to pay a wage lower than the 
highest wage required by any applicable Federal, State, or local law.
    (i) Retention of documentation. The employer must retain the PWD for 
3 years and submitted to a CO in the event it is requested in an RFI or 
an audit or to a Wage and Hour representative in the event of a Wage and 
Hour investigation.

    Effective Date Note 1: At 76 FR 3483, Jan. 19, 2011,Sec. 655.10 
was amended by revising paragraphs (b) introductory text, (b)(1), and 
(2); removing paragraphs (b)(4) and (b)(5) and redesignating paragraph 
(b)(3) as (b)(4) and (b)(6) as (b)(5); adding new paragraphs (b)(3), 
(b)(6), and (b)(7); and removing paragraphs (f) and (g) and 
redesignating paragraph (h) as (f) and paragraph (i) as (g), effective 
Jan. 1, 2012. At 76 FR 45673, Aug. 1, 2011, the effective date was 
changed to Sept. 30, 2011. At 76 FR 59896, Sept. 28, 2011, the effective 
date was delayed until Nov. 30, 2011. At 76 FR 73508, Nov. 29, 2011, the 
effective date was further delayed until Jan. 1, 2012. At 76 FR 82115, 
Dec. 30, 2012, the effective date was further delayed until Oct. 1, 
2012. For the convenience of the user, the added and revised text is set 
forth as follows:



Sec.  655.10  Determination of prevailing wage for temporary labor 
          certification purposes.

                                * * * * *

    (b) Basis for prevailing wage determinations. The prevailing wage is 
the highest of the following:
    (1) The wage rate set forth in the CBA, if the job opportunity is 
covered by a CBA that was negotiated at arms' length between the union 
and the employer;
    (2) The wage rate established under the DBA or SCA for the 
occupation in the area of intended employment if the job opportunity is 
in an occupation for which such a wage rate has been determined; or
    (3) The arithmetic mean of the wages of workers similarly employed 
in the occupation in the area of intended employment as determined by 
the OES. This computation will be based on the arithmetic mean wage of 
all workers in the occupation.

                                * * * * *

    (6) In geographic areas where the OES does not gather wage data, 
including but not limited to the jurisdiction of the Commonwealth of the 
Northern Mariana Islands, and there is no CBA, DBA, or SCA wage 
available for the job opportunity, the NPC will consider wage 
information in the form of a wage survey provided by an employer in 
making a prevailing wage determination. Such a survey may only be 
submitted with a request for a prevailing wage determination. A request 
filed under this paragraph does not need to be preceded by a request and 
approval to submit wage information as described in paragraph (b)(7) of 
this section.
    (7)(i) An employer may submit a written request to the 
Administrator, OFLC to provide a private wage survey for OFLC to 
consider in making a prevailing wage determination which must 
demonstrate that the following factors are present:
    (A) There is no CBA, DBA, or SCA wage available for the job 
opportunity;
    (B) The job opportunity was not listed in the Dictionary of 
Occupational Titles (DOT) and is not listed in the Standard Occupational 
Classification (SOC) system, or if the job opportunity was listed in the 
DOT or is listed in the SOC system, the DOT crosswalk to the SOC system 
links to an occupational classification signifying a generalized set of 
occupations as ``all other''; and
    (C) The job description entails job duties which require knowledge, 
skills, abilities, and work tasks that are significantly different, as 
defined in guidance to be issued by the OFLC, than those in any other 
SOC occupation.
    (ii) The Administrator, OFLC may approve or deny an employer's 
written request to provide a wage survey. If the Administrator, OFLC 
approves the employer's written request, the Administrator, OFLC will 
send an approval letter to the employer. Approvals shall be valid for 1 
year from the date of approval and only for the job opportunity and area 
of intended employment specified in the original written request. This 
approval does not constitute an acceptance of any particular wage 
survey.
    (iii) If approval is granted, the employer may submit a request for 
a prevailing wage determination to the NPC along with a copy of the 
Administrator, OFLC's approval letter and a complete copy of the private 
survey. The NPC will evaluate the adequacy of the data provided and 
validity of the statistical methodology used in conducting the survey in 
accordance with guidance issued by the OFLC National Office.
    (iv) In each case where the employer submits a wage survey for which 
it seeks acceptance, the employer must provide specific information 
about the survey methodology, including such items as sample size and 
source, sample selection procedures, and survey job descriptions, to 
allow a determination of the adequacy of the data provided and validity 
of the statistical methodology used in conducting the survey in 
accordance with guidance issued by the OFLC National Office.
    (v) The survey must be based upon recently collected data:

[[Page 488]]

    (A) Any published survey must have been published within 24 months 
of the date of submission, must be the most current edition of the 
survey, and must be based on data collected not more than 24 months 
before the publication date.
    (B) A survey conducted by the employer must be based on data 
collected within 24 months of the date it is submitted for 
consideration.
    (vi) The survey cannot as any part of its data wage information 
reflect the wages of H-2B workers or other nonimmigrant workers.
    (vii) If the NPC does not approve the survey for use in the H-2B 
program, the NPC shall inform the employer in writing of the reasons the 
survey was not accepted. An employer may appeal the NPC's decision in 
accordance withSec. 655.11.

    Effective Date Note 2: At 77 FR 10151, Feb. 21, 2012,Sec. 655.10 
was amended by revising paragraphs (a), (c) through (e), (h), and (i), 
and adding paragraphs (j) and (k), effective Apr. 23, 2012. For the 
convenience of the user, the added and revised text is set forth as 
follows:



Sec.  655.10  Prevailing wage.

    (a) Offered wage. The employer must advertise the position to all 
potential workers at a wage at least equal to the prevailing wage 
obtained from the NPWC, or the Federal, State or local minimum wage, 
whichever is highest. The employer must offer and pay this wage (or 
higher) to both its H-2B workers and its workers in corresponding 
employment. The issuance of a PWD under this section does not permit an 
employer to pay a wage lower than the highest wage required by any 
applicable Federal, State or local law.

                                * * * * *

    (c) Request for PWD. (1) An employer must request and receive a PWD 
from the NPWC before filing the job order with the SWA.
    (2) The PWD must be valid on the date the job order is posted.
    (d) Multiple worksites. If the job opportunity involves multiple 
worksites within an area of intended employment and different prevailing 
wage rates exist for the opportunity within the area of intended 
employment, the prevailing wage is the highest applicable wage among all 
the worksites.
    (e) NPWC action. The NPWC will provide the PWD, indicate the source, 
and return the Application for Prevailing Wage Determination (ETA Form 
9141) with its endorsement to the employer.

                                * * * * *

    (h) Validity period. The NPWC must specify the validity period of 
the prevailing wage, which in no event may be more than 365 days and no 
less than 90 days from the date that the determination is issued.
    (i) Professional athletes. In computing the prevailing wage for a 
professional athlete when the job opportunity is covered by professional 
sports league rules or regulations, the wage set forth in those rules or 
regulations is considered the prevailing wage. 8 U.S.C. 1182(p)(2).
    (j) Retention of documentation. The employer must retain the PWD for 
3 years from the date of issuance or the date of a final determination 
on the Application for Temporary Employment Certification, whichever is 
later, and submit it to a CO if requested by a Notice of Deficiency, 
described inSec. 655.31, or audit, as described inSec. 655.70, or to 
a WHD representative during a WHD investigation.
    (k) Guam. The requirements of this paragraph apply to any request 
filed for an H-2B job opportunity on Guam.



Sec.  655.11  Certifying officer review of prevailing wage determinations.

    (a) Request for review of prevailing wage determinations. Any 
employer desiring review of a PWD must make a written request for such 
review within 10 days of the date from when the final PWD was issued. 
The request for review must be sent to the NPC postmarked no later than 
10 days after the determination; clearly identify the PWD for which 
review is sought; set forth the particular grounds for the request; and 
include all materials submitted to the NPC for purposes of securing the 
PWD.
    (b) NPC review. Upon the receipt of a written request for review, 
the NPC shall review the employer's request and accompanying 
documentation, including any supplementary material submitted by the 
employer.
    (c) Designations. The Director of the NPC will determine which CO 
will review the employer's request for review.
    (d) Review on the record. The CO shall review the PWD solely on the 
basis upon which the PWD was made and after review may:
    (1) Affirm the PWD issued by the NPC; or
    (2) Modify the PWD.
    (e) Request for review by BALCA. Any employer desiring review of a 
CO's decision on a PWD must make a written request for review of the 
determination by BALCA within 30 calendar days of

[[Page 489]]

the date of the decision of the CO. The CO must receive the written 
request for BALCA review no later than the 30th day after the date of 
its final determination including the date of the final determination.
    (1) The request for review, statements, briefs, and other 
submissions of the parties and amicus curiae must contain only legal 
arguments and only such evidence that was within the record upon which 
the decision on the PWD by the NPC was based.
    (2) The request for review must be in writing and addressed to the 
CO who made the determination. Upon receipt of a request for a review, 
the CO must immediately assemble an indexed appeal file in reverse 
chronological order, with the index on top followed by the most recent 
document.
    (3) The CO must send the Appeal File to the Office of Administrative 
Law Judges, Board of Alien Labor Certification Appeals, 800 K Street, 
NW., Suite 400-N, Washington, DC 20001-8002.
    (4) The BALCA shall handle appeals in accordance withSec. 655.33.

    Effective Date Note: At 77 FR 10152, Feb. 21, 2012,Sec. 655.11 was 
revised, effective Apr. 23, 2012. For the convenience of the user, the 
revised text is set forth as follows:



Sec.  655.11  Registration of H-2B employers.

    All employers that desire to hire H-2B workers must establish their 
need for services or labor is temporary by filing an H-2B Registration 
with the Chicago NPC.
    (a) Registration filing. An employer must file an H-2B Registration. 
The H-2B Registration must be accompanied by documentation evidencing:
    (1) The number of positions that will be sought in the first year of 
registration;
    (2) The time period of need for the workers requested;
    (3) That the nature of the employer's need for the services or labor 
to be performed is non-agricultural and temporary, and is justified as 
either a one-time occurrence, a seasonal need, a peakload need, or an 
intermittent need, as defined at 8 CFR 214.2(h)(6)(ii)(B) andSec. 
655.6 (or in the case of job contractors, a seasonal need or one-time 
occurrence); and
    (4) For job contractors, the job contractor's own seasonal need or 
one-time occurrence, such as through the provision of payroll records.
    (b) Original signature. The H-2B Registration must bear the original 
signature of the employer (and that of the employer's attorney or agent 
if applicable). If and when the H-2B Registration is permitted to be 
filed electronically, the employer will satisfy this requirement by 
signing the H-2B Registration as directed by the CO.
    (c) Timeliness of registration filing. A completed request for an H-
2B Registration must be received by no less than 120 calendar days and 
no more than 150 calendar days before the employer's date of need, 
except where the employer submits the H-2B Registration in support of an 
emergency filing underSec. 655.17.
    (d) Temporary need. (1) The employer must establish that its need 
for non-agricultural services or labor is temporary, regardless of 
whether the underlying job is permanent or temporary. 8 CFR 
214.2(h)(6)(ii)(A). A job contractor must also demonstrate through 
documentation its own seasonal need or one-time occurrence.
    (2) The employer's need will be assessed in accordance with the 
definitions provided by the Secretary of DHS and as further defined in 
Sec.  655.6.
    (e) NPC review. The CO will review the H-2B Registration and its 
accompanying documentation for completeness and make a determination 
based on the following factors:
    (1) The job classification and duties qualify as non-agricultural;
    (2) The employer's need for the services or labor to be performed is 
temporary in nature, and for job contractors, demonstration of the job 
contractor's own seasonal need or one-time occurrence;
    (3) The number of worker positions and period of need are justified; 
and
    (4) The request represents a bona fide job opportunity.
    (f) Mailing and postmark requirements. Any notice or request 
pertaining to an H-2B Registration sent by the CO to an employer 
requiring a response will be mailed to the address provided on the H-2B 
Registration using methods to assure next day delivery, including 
electronic mail. The employer's response to the notice or request must 
be mailed using methods to assure next day delivery, including 
electronic mail, and be sent by the due date specified by the CO or by 
the next business day if the due date falls on a Saturday, Sunday or 
Federal holiday.
    (g) Request for information (RFI). If the CO determines the H-2B 
Registration cannot be approved, the CO will issue an RFI. The RFI will 
be issued within 7 business days of the CO's receipt of the H-2B 
Registration. The RFI will:
    (1) State the reason(s) why the H-2B Registration cannot be approved 
and what supplemental information or documentation is needed to correct 
the deficiencies;
    (2) Specify a date, no later than 7 business days from the date the 
RFI is issued, by which the supplemental information or documentation 
must be sent by the employer;

[[Page 490]]

    (3) State that, upon receipt of a response to the RFI, the CO will 
review the H-2B Registration as well as any supplemental information and 
documentation and issue a Notice of Decision on the H-2B Registration. 
The CO may, at his or her discretion, issue one or more additional RFIs 
before issuing a Notice of Decision on the H-2B Registration; and
    (4) State that failure to comply with an RFI, including not 
responding in a timely manner or not providing all required 
documentation within the specified timeframe, will result in a denial of 
the H-2B Registration.
    (h) Notice of Decision. The CO will notify the employer in writing 
of the final decision on the H-2B Registration.
    (1) Approved H-2B Registration. If the H-2B Registration is 
approved, the CO will send a Notice of Decision to the employer, and a 
copy to the employer's attorney or agent, if applicable. The Notice of 
Decision will notify the employer that it is eligible to seek H-2B 
workers in the occupational classification for the anticipated number of 
positions and period of need stated on the approved H-2B Registration. 
The CO may approve the H-2B Registration for a period of up to 3 
consecutive years.
    (2) Denied H-2B Registration. If the H-2B Registration is denied, 
the CO will send a Notice of Decision to the employer, and a copy to the 
employer's attorney or agent, if applicable. The Notice of Decision 
will:
    (i) State the reason(s) why the H-2B Registration is denied;
    (ii) Offer the employer an opportunity to request administrative 
review underSec. 655.61 within 10 business days from the date the 
Notice of Decision is issued and state that if the employer does not 
request administrative review within that period the denial is final.
    (i) Retention of documents. All employers filing an H-2B 
Registration are required to retain any documents and records not 
otherwise submitted proving compliance with this subpart. Such records 
and documents must be retained for a period of 3 years from the date of 
certification of the last Application for Temporary Employment 
Certification supported by the H-2B Registration, if approved, or 3 
years from the date the decision is issued if the H-2B Registration is 
denied or 3 years from the day the Department receives written 
notification from the employer withdrawing its pending H-2B 
Registration.
    (j) Transition period. In order to allow OFLC to make the necessary 
changes to its program operations to accommodate the new registration 
process, OFLC will announce in the Federal Register a separate 
transition period for the registration process, and until that time, 
will continue to adjudicate temporary need during the processing of 
applications.



Sec.  655.12  Use of registration of H-2B employers.

    (a) Upon approval of the H-2B Registration, the employer is 
authorized for the specified period of up to 3 consecutive years from 
the date the H-2B Registration is approved to file an Application for 
Temporary Employment Certification, unless:
    (1) The number of workers to be employed has increased by more than 
20 percent (or 50 percent for employers requesting fewer than 10 
workers) from the initial year;
    (2) The dates of need for the job opportunity have changed by more 
than a total of 30 calendar days from the initial year for the entire 
period of need;
    (3) The nature of the job classification and/or duties has 
materially changed; or
    (4) The temporary nature of the employer's need for services or 
labor to be performed has materially changed.
    (b) If any of the changes in paragraphs (a)(1) through (4) of this 
section apply, the employer must file a new H-2B Registration in 
accordance withSec. 655.11.

[77 FR 10153, Feb. 21, 2012]

    Effective Date Note: At 77 FR 10153, Feb. 21, 2012,Sec. 655.12 was 
added, effective Apr. 23, 2012.



Sec.  655.13  Review of PWDs.

    (a) Request for review of PWDs. Any employer desiring review of a 
PWD must make a written request for such review to the NPWC Director 
within 7 business days from the date the PWD is issued. The request for 
review must clearly identify the PWD for which review is sought; set 
forth the particular grounds for the request; and include any materials 
submitted to the NPWC for purposes of securing the PWD.
    (b) NPWC review. Upon the receipt of the written request for review, 
the NPWC Director will review the employer's request and accompanying 
documentation, including any supplementary material submitted by the 
employer, and after review shall issue a Final Determination letter; 
that letter may:
    (1) Affirm the PWD issued by the NPWC; or
    (2) Modify the PWD.

[[Page 491]]

    (c) Request for review by BALCA. Any employer desiring review of the 
NPWC Director's decision on a PWD must make a written request for review 
of the determination by BALCA within 10 business days from the date the 
Final Determination letter is issued.
    (1) The request for BALCA review must be in writing and addressed to 
the NPWC Director who made the final determinations. Upon receipt of a 
request for BALCA review, the NPWC will prepare an appeal file and 
submit it to BALCA.
    (2) The request for review, statements, briefs, and other 
submissions of the parties must contain only legal arguments and may 
refer to only the evidence that was within the record upon which the 
decision on the PWD was based.
    (3) BALCA will handle appeals in accordance withSec. 655.61.

[77 FR 10153, Feb. 21, 2012]

    Effective Date Note: At 77 FR 10153, Feb. 21, 2012,Sec. 655.13 was 
added, effective Apr. 23, 2012.



Sec.  655.14  [Reserved]

  Application for Temporary Employment Certification Filing Procedures

    Effective Date Note: At 77 FR 10153, Feb. 21, 2012, an undesignated 
center heading was added beforeSec. 655.15, effective Apr. 23, 2012.



Sec.  655.15  Required pre-filing recruitment.

    (a) Time of filing of application. An employer may not file an 
Application for Temporary Employment Certification before all of the 
pre-filing recruitment steps set forth in this section have been fully 
satisfied, except where specifically exempted from some or all of those 
requirements by these regulations or special procedures. Applications 
submitted not meeting this requirement shall not be accepted for 
processing.
    (b) General attestation obligation. An employer must attest on the 
Application for Temporary Employment Certification to having performed 
all required steps of the recruitment process as specified in this 
section.
    (c) Retention of documentation. The employer filing the Application 
for Temporary Employment Certification must maintain documentation of 
its advertising and recruitment efforts, including prevailing wage 
determinations, as required in this subpart and be prepared, upon 
written request, to submit this documentation in response to an RFI from 
the CO prior to the CO rendering a Final Determination or in the event 
of a CO-directed audit examination. The documentation required in this 
section must be retained by the employer for a period of no less than 3 
years from the date of the certification.
    (d) Recruitment steps. An employer filing an application must:
    (1) Obtain a prevailing wage determination from the NPC in 
accordance with procedures inSec. 655.10;
    (2) Submit a job order to the SWA serving the area of intended 
employment;
    (3) Publish two print advertisements (one of which must be on a 
Sunday, except as provided in paragraph (f)(4) of this section); and
    (4) Where the employer is a party to a collective bargaining 
agreement governing the job classification that is the subject of the H-
2B labor certification application, the employer must formally contact 
the local union that is party to the collective bargaining agreement as 
a recruitment source for able, willing, qualified, and available U.S. 
workers.
    (e) Job order. (1) The employer must place an active job order with 
the SWA serving the area of intended employment no more than 120 
calendar days before the employer's date of need for H-2B workers, 
identifying it as a job order to be placed in connection with a future 
application for H-2B workers. Unless otherwise directed by the CO, the 
SWA must keep the job order open for a period of not less than 10 
calendar days. Documentation of this step shall be satisfied by 
maintaining a copy of the SWA job order downloaded from the SWA Internet 
job listing site, a copy of the job order provided by the SWA, or other 
proof of publication from the SWA containing the text of the job order 
and the start and end dates of posting. If the job opportunity

[[Page 492]]

contains multiple work locations within the same area of intended 
employment and the area of intended employment is found in more than one 
State, the employer shall place a job order with the SWA having 
jurisdiction over the place where the work has been identified to begin. 
Upon placing a job order, the SWA receiving the job order under this 
paragraph shall promptly transmit, on behalf of the employer, a copy of 
the active job order to all States listed in the application as 
anticipated worksites.
    (2) The job order submitted by the employer to the SWA must satisfy 
all the requirements for newspaper advertisements contained inSec. 
655.17.
    (f) Newspaper advertisements. (1) During the period of time that the 
job order is being circulated for intrastate clearance by the SWA under 
paragraph (e) of this section, the employer must publish an 
advertisement on 2 separate days, which may be consecutive, one of which 
must be a Sunday advertisement (except as provided in paragraph (f)(2) 
of this section), in a newspaper of general circulation serving the area 
of intended employment that has a reasonable distribution and is 
appropriate to the occupation and the workers likely to apply for the 
job opportunity. Both newspaper advertisements must be published only 
after the job order is placed for active recruitment by the SWA.
    (2) If the job opportunity is located in a rural area that does not 
have a newspaper with a Sunday edition, the employer must, in place of a 
Sunday edition advertisement, advertise in the regularly published daily 
edition with the widest circulation in the area of intended employment.
    (3) The newspaper advertisements must satisfy the requirements 
contained inSec. 655.17. The employer must maintain copies of 
newspaper pages (with date of publication and full copy of 
advertisement), or tear sheets of the pages of the publication in which 
the advertisements appeared, or other proof of publication containing 
the text of the printed advertisements and the dates of publication 
furnished by the newspaper.
    (4) If a professional, trade or ethnic publication is more 
appropriate for the occupation and the workers likely to apply for the 
job opportunity than a general circulation newspaper, and is the most 
likely source to bring responses from able, willing, qualified, and 
available U.S. workers, then the employer may use a professional, trade 
or ethnic publication in place of one of the newspaper advertisements, 
but may not replace the Sunday advertisement (or the substitute 
permitted by paragraph (f)(2) of this section).
    (g) Labor organizations. During the period of time that the job 
order is being circulated for intrastate clearance by the SWA under 
paragraph (e) of this section, an employer that is already a party to a 
collective bargaining agreement governing the job classification that is 
the subject of the H-2B labor certification application must formally 
contact by U.S. Mail or other effective means the local union that is 
party to the collective bargaining agreement. An employer governed by 
this paragraph must maintain dated logs demonstrating that such 
organizations were contacted and notified of the position openings and 
whether they referred qualified U.S. worker(s), including number of 
referrals, or were non-responsive to the employer's request.
    (h) Layoff. If there has been a layoff of U.S. workers by the 
applicant employer in the occupation in the area of intended employment 
within 120 days of the first date on which an H-2B worker is needed as 
indicated on the submitted Application for Temporary Employment 
Certification, the employer must document it has notified or will notify 
each laid-off worker of the job opportunity involved in the application 
and has considered or will consider each laid-off worker who expresses 
interest in the opportunity, and the result of the notification and 
consideration.
    (i) Referral of U.S. workers. SWAs may only refer for employment 
individuals for whom they have verified identity and employment 
authorization through the process for employment verification of all 
workers that is established by INA sec. 274A(b). SWAs must provide 
documentation certifying the employment verification that satisfies the 
standards of INA sec.

[[Page 493]]

274A(a)(5) and its implementing regulations at 8 CFR 274a.6.
    (j) Recruitment report. (1) No fewer than 2 calendar days after the 
last date on which the job order was posted and no fewer than 5 calendar 
days after the date on which the last newspaper or journal advertisement 
appeared, the employer must prepare, sign, and date a written 
recruitment report. The employer may not submit the H-2B application 
until the recruitment report is completed. The recruitment report must 
be submitted to the NPC with the application. The employer must retain a 
copy of the recruitment report for a period of 3 years.
    (2) The recruitment report must:
    (i) Identify each recruitment source by name;
    (ii) State the name and contact information of each U.S. worker who 
applied or was referred to the job opportunity up to the date of the 
preparation of the recruitment report, and the disposition of each 
worker, including any applicable laid-off workers;
    (iii) If applicable, explain the lawful job-related reason(s) for 
not hiring any U.S. workers who applied or were referred to the 
position.
    (3) The employer must retain r[eacute]sum[eacute]s (if available) 
of, and evidence of contact with (which may be in the form of an 
attestation), each U.S. worker who applied or was referred to the job 
opportunity. Such r[eacute]sum[eacute]s and evidence of contact must be 
retained along with the recruitment report for a period of no less than 
3 years, and must be provided in response to an RFI or in the event of 
an audit or an investigation.

    Effective Date Note: At 77 FR 10153, Feb. 21, 2012,Sec. 655.15 was 
revised, effective Apr. 23, 2012. For the convenience of the user, the 
revised text is set forth as follows:



Sec.  655.15  Application filing requirements.

    All registered employers that desire to hire H-2B workers must file 
an Application for Temporary Employment Certification with the NPC 
designated by the Administrator, OFLC. Except for employers that qualify 
for emergency procedures atSec. 655.17, employers that fail to 
register under the procedures inSec. 655.11 and/or that fail to submit 
a PWD obtained underSec. 655.10 will not be eligible to file an 
Application for Temporary Employment Certification and their 
applications will be returned without review.
    (a) What to file. A registered employer seeking H-2B workers must 
file a completed Application for Temporary Employment Certification (ETA 
Form 9142 and the appropriate appendices and valid PWD), a copy of the 
job order being submitted concurrently to the SWA serving the area of 
intended employment, as set forth inSec. 655.16, and copies of all 
contracts and agreements with any agent and/or recruiter, executed in 
connection with the job opportunities and all information required, as 
specified in Sec.Sec. 655.8 and 655.9.
    (b) Timeliness. A completed Application for Temporary Employment 
Certification must be filed no more than 90 calendar days and no less 
than 75 calendar days before the employer's date of need.
    (c) Location and method of filing. The employer must submit the 
Application for Temporary Employment Certification and all required 
supporting documentation to the NPC. At a future date the Department may 
also permit an Application for Temporary Employment Certification to be 
filed electronically in addition to or instead of by mail. Notice of 
such procedure will be published in the Federal Register.
    (d) Original signature. The Application for Temporary Employment 
Certification must bear the original signature of the employer (and that 
of the employer's authorized attorney or agent if the employer is so 
represented). If and when an Application for Temporary Employment 
Certification is permitted to be filed electronically, the employer will 
satisfy this requirement by signing the Application for Temporary 
Employment Certification as directed by the CO.
    (e) Requests for multiple positions. Certification of more than one 
position may be requested on the Application for Temporary Employment 
Certification as long as all H-2B workers will perform the same services 
or labor under the same terms and conditions, in the same occupation, in 
the same area of intended employment, and during the same period of 
employment.
    (f) Separate applications. Only one Application for Temporary 
Employment Certification may be filed for worksite(s) within one area of 
intended employment for each job opportunity with an employer for each 
period of employment. Except where otherwise permitted underSec. 
655.4, an association or other organization of employers is not 
permitted to file master applications on behalf of its employer-members 
under the H-2B program.
    (g) One-time occurrence. Where a one-time occurrence lasts longer 
than 1 year, the CO will instruct the employer on any additional 
recruitment requirements with respect to the continuing validity of the 
labor market test or offered wage obligation.
    (h) Information dissemination. Information received in the course of 
processing a request for an H-2B Registration, an Application for

[[Page 494]]

Temporary Employment Certification or program integrity measures such as 
audits may be forwarded from OFLC to WHD, or any other Federal agency as 
appropriate, for investigative and/or enforcement purposes.



Sec.  655.16  Filing of the job order at the SWA.

    (a) Submission of the job order. (1) The employer must submit the 
job order to the SWA serving the area of intended employment at the same 
time it submits the Application for Temporary Employment Certification 
and a copy of the job order to the NPC in accordance withSec. 655.15. 
If the job opportunity is located in more than one State within the same 
area of intended employment, the employer may submit the job order to 
any one of the SWAs having jurisdiction over the anticipated worksites, 
but must identify the receiving SWA on the copy of the job order 
submitted to the NPC with its Application for Temporary Employment 
Certification. The employer must inform the SWA that the job order is 
being placed in connection with a concurrently submitted Application for 
Temporary Employment Certification for H-2B workers.
    (2) In addition to complying with State-specific requirements 
governing job orders, the job order submitted to the SWA must satisfy 
the requirements set forth inSec. 655.18.
    (b) SWA review of the job order. The SWA must review the job order 
and ensure that it complies with criteria set forth inSec. 655.18. If 
the SWA determines that the job order does not comply with the 
applicable criteria, the SWA must inform the CO at the NPC of the noted 
deficiencies within 6 business days of receipt of the job order.
    (c) Intrastate and interstate clearance. Upon receipt of the Notice 
of Acceptance, as described inSec. 655.33, the SWA must promptly place 
the job order in intrastate clearance and provide to other states as 
directed by the CO.
    (d) Duration of job order posting and SWA referral of U.S. workers. 
Upon receipt of the Notice of Acceptance, any SWA in receipt of the 
employer's job order must keep the job order on its active file until 
the end of the recruitment period, as set forth inSec. 655.40(c), and 
must refer to the employer in a manner consistent withSec. 655.47 all 
qualified U.S. workers who apply for the job opportunity or on whose 
behalf a job application is made.
    (e) Amendments to a job order. The employer may amend the job order 
at any time before the CO makes a final determination, in accordance 
with procedures set forth inSec. 655.35.

[77 FR 10154, Feb. 21, 2012]

    Effective Date Note: At 77 FR 10154, Feb. 21, 2012,Sec. 655.16 was 
added, effective Apr. 23, 2012.



Sec.  655.17  Advertising requirements.

    All advertising conducted to satisfy the required recruitment steps 
underSec. 655.15 before filing the Application for Temporary 
Employment Certification must meet the requirements set forth in this 
section and must contain terms and conditions of employment which are 
not less favorable than those to be offered to the H-2B workers. All 
advertising must contain the following information:
    (a) The employer's name and appropriate contact information for 
applicants to send r[eacute]sum[eacute]s directly to the employer;
    (b) The geographic area of employment with enough specificity to 
apprise applicants of any travel requirements and where applicants will 
likely have to reside to perform the services or labor;
    (c) If transportation to the worksite(s) will be provided by the 
employer, the advertising must say so;
    (d) A description of the job opportunity (including the job duties) 
for which labor certification is sought with sufficient detail to 
apprise applicants of services or labor to be performed and the duration 
of the job opportunity;
    (e) The job opportunity's minimum education and experience 
requirements and whether or not on-the-job training will be available;
    (f) The work hours and days, expected start and end dates of 
employment, and whether or not overtime will be available;
    (g) The wage offer, or in the event that there are multiple wage 
offers, the range of applicable wage offers, each of which must not be 
less than the highest of the prevailing wage, the Federal minimum wage, 
State minimum wage, or local minimum wage applicable

[[Page 495]]

throughout the duration of the certified H-2B employment; and
    (h) That the position is temporary and the total number of job 
openings the employer intends to fill.

    Effective Date Note: At 77 FR 10153, Feb. 21, 2012,Sec. 655.17 was 
revised, effective Apr. 23, 2012. For the convenience of the user, the 
revised text is set forth as follows:



Sec.  655.17  Emergency situations.

    (a) Waiver of time period. The CO may waive the time period(s) for 
filing an H-2B Registration and/or an Application for Temporary 
Employment Certification for employers that have good and substantial 
cause, provided that the CO has sufficient time to thoroughly test the 
domestic labor market on an expedited basis and to make a final 
determination as required bySec. 655.50.
    (b) Employer requirements. The employer requesting a waiver of the 
required time period(s) must submit to the NPC a request for a waiver of 
the time period requirement, a completed Application for Temporary 
Employment Certification and the proposed job order identifying the SWA 
serving the area of intended employment, and must otherwise meet the 
requirements ofSec. 655.15. If the employer did not previously apply 
for an H-2B Registration, the employer must also submit a completed H-2B 
Registration with all supporting documentation, as required bySec. 
655.11. If the employer did not previously apply for a PWD, the employer 
must also submit a completed PWD request. The employer's waiver request 
must include detailed information describing the good and substantial 
cause that has necessitated the waiver request. Good and substantial 
cause may include, but is not limited to, the substantial loss of U.S. 
workers due to Acts of God, or a similar unforeseeable man-made 
catastrophic event (such as an oil spill or controlled flooding) that is 
wholly outside of the employer's control, unforeseeable changes in 
market conditions, or pandemic health issues. A denial of a previously 
submitted H-2B Registration in accordance with the procedures set forth 
inSec. 655.11 does not constitute good and substantial cause 
necessitating a waiver under this section.
    (c) Processing of emergency applications. The CO will process the 
emergency H-2B Registration and/or Application for Temporary Employment 
Certification and job order in a manner consistent with the provisions 
of this subpart and make a determination on the Application for 
Temporary Employment Certification in accordance withSec. 655.50. If 
the CO grants the waiver request, the CO will forward a Notice of 
Acceptance and the approved job order to the SWA serving the area of 
intended employment identified by the employer in the job order. If the 
CO determines that the certification cannot be granted because, under 
paragraph (a) of this section, the request for emergency filing is not 
justified and/or there is not sufficient time to make a determination of 
temporary need or ensure compliance with the criteria for certification 
contained inSec. 655.51, the CO will send a Final Determination letter 
to the employer in accordance withSec. 655.53.



Sec.  655.18  Job order assurances and contents.

    (a) General. Each job order placed in connection with an Application 
for Temporary Employment Certification must at a minimum include the 
information contained in paragraph (b) of this section. In addition, by 
submitting the Application for Temporary Employment Certification, an 
employer agrees to comply with the following assurances with respect to 
each job order:
    (1) Prohibition against preferential treatment. The employer's job 
order must offer to U.S. workers no less than the same benefits, wages, 
and working conditions that the employer is offering, intends to offer, 
or will provide to H-2B workers. Job offers may not impose on U.S. 
workers any restrictions or obligations that will not be imposed on the 
employer's H-2B workers. This does not relieve the employer from 
providing to H-2B workers at least the minimum benefits, wages, and 
working conditions which must be offered to U.S. workers consistent with 
this section.
    (2) Bona fide job requirements. Each job qualification and 
requirement must be listed in the job order and must be bona fide and 
consistent with the normal and accepted qualifications and requirements 
imposed by non-H-2B employers in the same occupation and area of 
intended employment.
    (b) Contents. In addition to complying with the assurances in 
paragraph (a) of this section, the employer's job order must meet the 
following requirements:
    (1) State the employer's name and contact information;
    (2) Indicate that the job opportunity is a temporary, full-time 
position, including the total number of job openings the employer 
intends to fill;
    (3) Describe the job opportunity for which certification is sought 
with sufficient information to apprise U.S. workers of the services or 
labor to be performed, including the duties, the

[[Page 496]]

minimum education and experience requirements, the work hours and days, 
and the anticipated start and end dates of the job opportunity;
    (4) Indicate the geographic area of intended employment with enough 
specificity to apprise applicants of any travel requirements and where 
applicants will likely have to reside to perform the services or labor;
    (5) Specify the wage that the employer is offering, intends to 
offer, or will provide to H-2B workers, or, in the event that there are 
multiple wage offers (such as where an itinerary is authorized through 
special procedures for an employer), the range of wage offers, and 
ensure that the wage offer equals or exceeds the highest of the 
prevailing wage or the Federal, State, or local minimum wage;
    (6) If applicable, specify that overtime will be available to the 
worker and the wage offer(s) for working any overtime hours;
    (7) If applicable, state that on-the-job training will be provided 
to the worker;
    (8) State that the employer will use a single workweek as its 
standard for computing wages due;
    (9) Specify the frequency with which the worker will be paid, which 
must be at least every 2 weeks or according to the prevailing practice 
in the area of intended employment, whichever is more frequent;
    (10) If the employer provides the worker with the option of board, 
lodging, or other facilities, including fringe benefits, or intends to 
assist workers to secure such lodging, disclose the provision and cost 
of the board, lodging, or other facilities, including fringe benefits or 
assistance to be provided;
    (11) State that the employer will make all deductions from the 
worker's paycheck required by law. Specify any deductions the employer 
intends to make from the worker's paycheck which are not required by 
law, including, if applicable, any deductions for the reasonable cost of 
board, lodging, or other facilities;
    (12) Detail how the worker will be provided with or reimbursed for 
transportation and subsistence from the place from which the worker has 
come to work for the employer, whether in the U.S. or abroad, to the 
place of employment, if the worker completes 50 percent of the period of 
employment covered by the job order, consistent withSec. 
655.20(j)(1)(i);
    (13) State that the employer will provide or pay for the worker's 
cost of return transportation and daily subsistence from the place of 
employment to the place from which the worker, disregarding intervening 
employment, departed to work for the employer, if the worker completes 
the certified period of employment or is dismissed from employment for 
any reason by the employer before the end of the period, consistent with 
Sec.  655.20(j)(1)(ii);
    (14) If applicable, state that the employer will provide daily 
transportation to and from the worksite;
    (15) State that the employer will reimburse the H-2B worker in the 
first workweek for all visa, visa processing, border crossing, and other 
related fees, including those mandated by the government, incurred by 
the H-2B worker (but need not include passport expenses or other charges 
primarily for the benefit of the worker);
    (16) State that the employer will provide to the worker, without 
charge or deposit charge, all tools, supplies, and equipment required to 
perform the duties assigned, in accordance withSec. 655.20(k);
    (17) State the applicability of the three-fourths guarantee, 
offering the worker employment for a total number of work hours equal to 
at least three-fourths of the workdays of each 12-week period, if the 
period of employment covered by the job order is 120 or more days, or 
each 6-week period, if the period of employment covered by the job order 
is less than 120 days, in accordance withSec. 655.20(f); and
    (18) Instruct applicants to inquire about the job opportunity or 
send applications, indications of availability, and/or resumes directly 
to the nearest office of the SWA in the State in which the advertisement 
appeared and include the SWA contact information.

[77 FR 10154, Feb. 21, 2012]

    Effective Date Note: At 77 FR 10154, Feb. 21, 2012,Sec. 655.18 was 
added, effective Apr. 23, 2012.

[[Page 497]]



Sec.  655.19  Job contractor filing requirements.

    (a) Provided that a job contractor and any employer-client are joint 
employers, a job contractor may submit an Application for Temporary 
Employment Certification on behalf of itself and that employer-client.
    (b) A job contractor must have separate contracts with each 
different employer-client. Each contract or agreement may support only 
one Application for Temporary Employment Certification for each 
employer-client job opportunity within a single area of intended 
employment.
    (c) Either the job contractor or its employer-client may submit an 
ETA Form 9141, Application for Prevailing Wage Determination, describing 
the job opportunity to the NPWC. However, each of the joint employers is 
separately responsible for ensuring that the wage offer listed on the 
Application for Temporary Employment Certification, ETA Form 9142, and 
related recruitment at least equals the prevailing wage rate determined 
by the NPWC and that all other wage obligations are met.
    (d)(1) A job contractor that is filing as a joint employer with its 
employer-client must submit to the NPC a completed Application for 
Temporary Employment Certification, ETA Form 9142, that clearly 
identifies the joint employers (the job contractor and its employer-
client) and the employment relationship (including the actual worksite), 
in accordance with the instructions provided by the Department. The 
Application for Temporary Employment Certification must bear the 
original signature of the job contractor and the employer-client and be 
accompanied by a recruitment report bearing both joint employers' 
signatures and the contract or agreement establishing the employers' 
relationship related to the workers sought.
    (2) By signing the Application for Temporary Employment 
Certification, each employer independently attests to the conditions of 
employment required of an employer participating in the H-2B program and 
assumes full responsibility for the accuracy of the representations made 
in the application and for all of the responsibilities of an employer in 
the H-2B program.
    (e)(1) Either the job contractor or its employer-client may place 
the required job order and conduct recruitment as described inSec. 
655.16 and Sec.Sec. 655.42-46. Also, either one of the joint employers 
may assume responsibility for interviewing applicants. However, both of 
the joint employers must sign the recruitment report that is submitted 
to the NPC with the Application for Temporary Employment Certification, 
ETA Form 9142.
    (2) The job order and all recruitment conducted by joint employers 
must satisfy the content requirements identified inSec. 655.18 and 
Sec.  655.41. Additionally, in order to fully apprise applicants of the 
job opportunity and avoid potential confusion inherent in a job 
opportunity involving two employers, joint employer recruitment must 
clearly identify both employers (the job contractor and its employer-
client) by name and must clearly identify the worksite location(s) where 
workers will perform labor or services.
    (3)(i) Provided that all of the employer-clients' job opportunities 
are in the same occupation and area of intended employment and have the 
same requirements and terms and conditions of employment, including 
dates of employment, a job contractor may combine more than one of its 
joint employer employer-clients' job opportunities in a single 
advertisement. Each advertisement must fully apprise potential workers 
of the job opportunity available with each employer-client and otherwise 
satisfy the advertising content requirements required for all H-2B-
related advertisements, as identified inSec. 655.41. Such a shared 
advertisement must clearly identify the job contractor by name, the 
joint employment relationship, and the number of workers sought for each 
job opportunity, identified by employer-client name and location (e.g. 5 
openings with Employer-Client 1 (worksite location), 3 openings with 
Employer-Client 2 (worksite location)).
    (ii) In addition, the advertisement must contain the following 
statement: ``Applicants may apply for any or all of the jobs listed. 
When applying, please identify the job(s) (by company and

[[Page 498]]

work location) you are applying to for the entire period of employment 
specified.'' If an applicant fails to identify one or more specific work 
location(s), that applicant is presumed to have applied to all work 
locations listed in the advertisement.
    (f) If an application for joint employers is approved, the NPC will 
issue one certification and send it to the job contractor. In order to 
ensure notice to both employers, a courtesy copy of the certification 
cover letter will be sent to the employer-client.
    (g) When submitting a certified Application for Temporary Employment 
Certification to USCIS, the job contractor should submit the complete 
ETA Form 9142 containing the original signatures of both the job 
contractor and employer-client.

[77 FR 10151, Feb. 21, 2012]

    Effective Date Note: At 77 FR 10154, Feb. 21, 2012,Sec. 655.19 was 
added, effective Apr. 23, 2012.

                       Assurances and Obligations

    Effective Date Note: At 77 FR 10156, Feb. 21, 2012, an undesignated 
center heading was added beforeSec. 655.20, effective Apr. 23, 2012.



Sec.  655.20  Applications for temporary employment certification.

    (a) Application filing requirements. An employer who desires to 
apply for labor certification of temporary employment for one or more 
nonimmigrant foreign positions must file a completed Application for 
Temporary Employment Certification form, and a copy of the recruitment 
report completed in accordance withSec. 655.15(j).
    (b) Filing. An employer must complete the Application for Temporary 
Employment Certification and send it by U.S. Mail or private mail 
courier to the NPC. Employers are strongly encouraged to keep receipts 
of any mailings. The Department will publish a Notice in the Federal 
Register identifying the address or addresses to which applications must 
be mailed, and will also post these addresses on the Department's 
Internet Web site at http://www.foreignlaborcert.doleta.gov/. The form 
must bear the original signature of the employer (and that of the 
employer's authorized attorney or agent if the employer is represented 
by an attorney or agent). The Department may, at a future date, require 
applications to be filed electronically in addition to or instead of by 
U.S. Mail or private mail courier.
    (c) Except where otherwise permitted underSec. 655.3, an 
association or other organization of employers is not permitted to file 
master applications on behalf of its employer-members under the H-2B 
program.
    (d) Certification of more than one position may be requested on the 
application as long as all H-2B workers will perform the same services 
or labor on the same terms and conditions, in the same occupation, in 
the same area of intended employment, and during the same period of 
employment.
    (e) Except where otherwise permitted underSec. 655.3, only one 
Application for Temporary Employment Certification may be filed for 
worksite(s) within one area of intended employment for each job 
opportunity with an employer.
    (f) Where a one-time occurrence lasts longer than one year, but less 
than 18 months, the employer will be issued a labor certification for 
the entire period of need. Where a one-time occurrence lasts 18 months 
or longer, the employer will be required to conduct another labor market 
for the portion of time beyond 12 months.

    Effective Date Note: At 77 FR 10156, Feb. 21, 2012,Sec. 655.20 was 
revised, effective Apr. 23, 2012. For the convenience of the user, the 
revised text is set forth as follows:



Sec.  655.20  Assurances and obligations of H-2B employers.

    An employer employing H-2B workers and/or workers in corresponding 
employment under an Application for Temporary Employment Certification 
has agreed as part of the Application for Temporary Employment 
Certification that it will abide by the following conditions with 
respect to its H-2B workers and any workers in corresponding employment:
    (a) Rate of pay. (1) The offered wage in the job order equals or 
exceeds the highest of the prevailing wage or Federal minimum wage, 
State minimum wage, or local minimum wage. The employer must pay at 
least the offered wage, free and clear, during the entire period of the 
Application for Temporary Employment Certification granted by OFLC.
    (2) The offered wage is not based on commissions, bonuses, or other 
incentives, including paying on a piece-rate basis, unless the employer 
guarantees a wage earned

[[Page 499]]

every workweek that equals or exceeds the offered wage.
    (3) If the employer requires one or more minimum productivity 
standards of workers as a condition of job retention, the standards must 
be specified in the job order and the employer must demonstrate that 
they are normal and usual for non-H-2B employers for the same occupation 
in the area of intended employment.
    (4) An employer that pays on a piece-rate basis must demonstrate 
that the piece rate is no less than the normal rate paid by non-H-2B 
employers to workers performing the same activity in the area of 
intended employment. The average hourly piece rate earnings must result 
in an amount at least equal to the offered wage. If the worker is paid 
on a piece rate basis and at the end of the workweek the piece rate does 
not result in average hourly piece rate earnings during the workweek at 
least equal to the amount the worker would have earned had the worker 
been paid at the offered hourly wage, then the employer must supplement 
the worker's pay at that time so that the worker's earnings are at least 
as much as the worker would have earned during the workweek if the 
worker had instead been paid at the offered hourly wage for each hour 
worked.
    (b) Wages free and clear. The payment requirements for wages in this 
section will be satisfied by the timely payment of such wages to the 
worker either in cash or negotiable instrument payable at par. The 
payment must be made finally and unconditionally and ``free and clear.'' 
The principles applied in determining whether deductions are reasonable 
and payments are received free and clear and the permissibility of 
deductions for payments to third persons are explained in more detail in 
29 CFR part 531.
    (c) Deductions. The employer must make all deductions from the 
worker's paycheck required by law. The job order must specify all 
deductions not required by law which the employer will make from the 
worker's pay; any such deductions not disclosed in the job order are 
prohibited. The wage payment requirements of paragraph (b) of this 
section are not met where unauthorized deductions, rebates, or refunds 
reduce the wage payment made to the worker below the minimum amounts 
required by the offered wage or where the worker fails to receive such 
amounts free and clear because the worker ``kicks back'' directly or 
indirectly to the employer or to another person for the employer's 
benefit the whole or part of the wages delivered to the worker. 
Authorized deductions are limited to: Those required by law, such as 
taxes payable by workers that are required to be withheld by the 
employer and amounts due workers which the employer is required by court 
order to pay to another; deductions for the reasonable cost or fair 
value of board, lodging, and facilities furnished; and deductions of 
amounts which are authorized to be paid to third persons for the 
worker's account and benefit through his or her voluntary assignment or 
order or which are authorized by a collective bargaining agreement with 
bona fide representatives of workers which covers the employer. 
Deductions for amounts paid to third persons for the worker's account 
and benefit which are not so authorized or are contrary to law or from 
which the employer, agent or recruiter including any agents or employees 
of these entities, or any affiliated person derives any payment, rebate, 
commission, profit, or benefit directly or indirectly, may not be made 
if they reduce the actual wage paid to the worker below the offered wage 
indicated on the Application for Temporary Employment Certification.
    (d) Job opportunity is full-time. The job opportunity is a full-time 
temporary position, consistent withSec. 655.5, and the employer must 
use a single workweek as its standard for computing wages due. An 
employee's workweek must be a fixed and regularly recurring period of 
168 hours--seven consecutive 24-hour periods. It need not coincide with 
the calendar week but may begin on any day and at any hour of the day.
    (e) Job qualifications and requirements. Each job qualification and 
requirement must be listed in the job order and must be bona fide and 
consistent with the normal and accepted qualifications and requirements 
imposed by non-H-2B employers in the same occupation and area of 
intended employment. The employer's job qualifications and requirements 
imposed on U.S. workers must be no less favorable than the 
qualifications and requirements that the employer is imposing or will 
impose on H-2B workers. A qualification means a characteristic that is 
necessary to the individual's ability to perform the job in question. A 
requirement means a term or condition of employment which a worker is 
required to accept in order to obtain the job opportunity. The CO may 
require the employer to submit documentation to substantiate the 
appropriateness of any job qualification and/or requirement specified in 
the job order.
    (f) Three-fourths guarantee. (1) The employer must guarantee to 
offer the worker employment for a total number of work hours equal to at 
least three-fourths of the workdays in each 12-week period (each 6-week 
period if the period of employment covered by the job order is less than 
120 days) beginning with the first workday after the arrival of the 
worker at the place of employment or the advertised first date of need, 
whichever is later, and ending on the expiration date specified in the 
job order or in its extensions, if any. See the exception in paragraph 
(y) of this section.
    (2) For purposes of this paragraph a workday means the number of 
hours in a workday

[[Page 500]]

as stated in the job order. The employer must offer a total number of 
hours of work to ensure the provision of sufficient work to reach the 
three-fourths guarantee in each 12-week period (each 6-week period if 
the period of employment covered by the job order is less than 120 days) 
during the work period specified in the job order, or during any 
modified job order period to which the worker and employer have mutually 
agreed and that has been approved by the CO.
    (3) In the event the worker begins working later than the specified 
beginning date the guarantee period begins with the first workday after 
the arrival of the worker at the place of employment, and continues 
until the last day during which the job order and all extensions thereof 
are in effect.
    (4) The 12-week periods (6-week periods if the period of employment 
covered by the job order is less than 120 days) to which the guarantee 
applies are based upon the workweek used by the employer for pay 
purposes. The first 12-week period (or 6-week period, as appropriate) 
also includes any partial workweek, if the first workday after the 
worker's arrival at the place of employment is not the beginning of the 
employer's workweek, with the guaranteed number of hours increased on a 
pro rata basis (thus, the first period may include up to 12 weeks and 6 
days (or 6 weeks and 6 days, as appropriate)). The final 12-week period 
(or 6-week period, as appropriate) includes any time remaining after the 
last full 12-week period (or 6-week period) ends, and thus may be as 
short as 1 day, with the guaranteed number of hours decreased on a pro 
rata basis.
    (5) Therefore, if, for example, a job order is for a 32-week period 
(a period greater than 120 days), during which the normal workdays and 
work hours for the workweek are specified as 5 days a week, 7 hours per 
day, the worker would have to be guaranteed employment for at least 315 
hours (12 weeks x 35 hours/week = 420 hours x 75 percent = 315) in the 
first 12-week period, at least 315 hours in the second 12-week period, 
and at least 210 hours (8 weeks x 35 hours/week = 280 hours x 75 percent 
= 210) in the final partial period. If the job order is for a 16-week 
period (less than 120 days), during which the normal workdays and work 
hours for the workweek are specified as 5 days a week, 7 hours per day, 
the worker would have to be guaranteed employment for at least 157.5 
hours (6 weeks x 35 hours/week = 210 hours x 75 percent = 157.5) in the 
first 6-week period, at least 157.5 hours in the second 6-week period, 
and at least 105 hours (4 weeks x 35 hours/week = 140 hours x 75 percent 
= 105) in the final partial period.
    (6) If the worker is paid on a piece rate basis, the employer must 
use the worker's average hourly piece rate earnings or the offered wage, 
whichever is higher, to calculate the amount due under the guarantee.
    (7) A worker may be offered more than the specified hours of work on 
a single workday. For purposes of meeting the guarantee, however, the 
worker will not be required to work for more than the number of hours 
specified in the job order for a workday. The employer, however, may 
count all hours actually worked in calculating whether the guarantee has 
been met. If during any 12-week period (6-week period if the period of 
employment covered by the job order is less than 120 days) during the 
period of the job order the employer affords the U.S. or H-2B worker 
less employment than that required under paragraph (f)(1) of this 
section, the employer must pay such worker the amount the worker would 
have earned had the worker, in fact, worked for the guaranteed number of 
days. An employer has not met the work guarantee if the employer has 
merely offered work on three-fourths of the workdays in an 12-week 
period (or 6-week period, as appropriate) if each workday did not 
consist of a full number of hours of work time as specified in the job 
order.
    (8) Any hours the worker fails to work, up to a maximum of the 
number of hours specified in the job order for a workday, when the 
worker has been offered an opportunity to work in accordance with 
paragraph (f)(1) of this section, and all hours of work actually 
performed (including voluntary work over 8 hours in a workday), may be 
counted by the employer in calculating whether each 12-week period (or 
6-week period, as appropriate) of guaranteed employment has been met. An 
employer seeking to calculate whether the guaranteed number of hours has 
been met must maintain the payroll records in accordance with this part.
    (g) Impossibility of fulfillment. If, before the expiration date 
specified in the job order, the services of the worker are no longer 
required for reasons beyond the control of the employer due to fire, 
weather, or other Act of God, or similar unforeseeable man-made 
catastrophic event (such as an oil spill or controlled flooding) that is 
wholly outside the employer's control that makes the fulfillment of the 
job order impossible, the employer may terminate the job order with the 
approval of the CO. In the event of such termination of a job order, the 
employer must fulfill a three-fourths guarantee, as described in 
paragraph (f) of this section, for the time that has elapsed from the 
start date listed in the job order or the first workday after the 
arrival of the worker at the place of employment, whichever is later, to 
the time of its termination. The employer must make efforts to transfer 
the H-2B worker or worker in corresponding employment to other 
comparable employment acceptable to the worker and consistent with the 
INA, as applicable. If a transfer is not effected, the employer must 
return the worker, at the employer's expense, to the place from which 
the

[[Page 501]]

worker (disregarding intervening employment) came to work for the 
employer, or transport the worker to the worker's next certified H-2B 
employer, whichever the worker prefers.
    (h) Frequency of pay. The employer must state in the job order the 
frequency with which the worker will be paid, which must be at least 
every 2 weeks or according to the prevailing practice in the area of 
intended employment, whichever is more frequent. Employers must pay 
wages when due.
    (i) Earnings statements. (1) The employer must keep accurate and 
adequate records with respect to the workers' earnings, including but 
not limited to: Records showing the nature, amount and location(s) of 
the work performed; the number of hours of work offered each day by the 
employer (broken out by hours offered both in accordance with and over 
and above the three-fourths guarantee in paragraph (f) of this section); 
the hours actually worked each day by the worker; if the number of hours 
worked by the worker is less than the number of hours offered, the 
reason(s) the worker did not work; the time the worker began and ended 
each workday; the rate of pay (both piece rate and hourly, if 
applicable); the worker's earnings per pay period; the worker's home 
address; and the amount of and reasons for any and all deductions taken 
from or additions made to the worker's wages.
    (2) The employer must furnish to the worker on or before each payday 
in one or more written statements the following information:
    (i) The worker's total earnings for each workweek in the pay period;
    (ii) The worker's hourly rate and/or piece rate of pay;
    (iii) For each workweek in the pay period the hours of employment 
offered to the worker (showing offers in accordance with the three-
fourths guarantee as determined in paragraph (f) of this section, 
separate from any hours offered over and above the guarantee);
    (iv) For each workweek in the pay period the hours actually worked 
by the worker;
    (v) An itemization of all deductions made from or additions made to 
the worker's wages;
    (vi) If piece rates are used, the units produced daily;
    (vii) The beginning and ending dates of the pay period; and
    (viii) The employer's name, address and FEIN.
    (j) Transportation and visa fees. (1)(i) Transportation to the place 
of employment. The employer must provide or reimburse the worker for 
transportation and subsistence from the place from which the worker has 
come to work for the employer, whether in the U.S. or abroad, to the 
place of employment if the worker completes 50 percent of the period of 
employment covered by the job order (not counting any extensions). The 
employer may arrange and pay for the transportation and subsistence 
directly, advance at a minimum the most economical and reasonable common 
carrier cost of the transportation and subsistence to the worker before 
the worker's departure, or pay the worker for the reasonable costs 
incurred by the worker. When it is the prevailing practice of non-H-2B 
employers in the occupation in the area to do so or when the employer 
extends such benefits to similarly situated H-2B workers, the employer 
must advance the required transportation and subsistence costs (or 
otherwise provide them) to workers in corresponding employment who are 
traveling to the employer's worksite. The amount of the transportation 
payment must be no less (and is not required to be more) than the most 
economical and reasonable common carrier transportation charges for the 
distances involved. The amount of the daily subsistence must be at least 
the amount permitted inSec. 655.173 of subpart B of this part. Where 
the employer will reimburse the reasonable costs incurred by the worker, 
it must keep accurate and adequate records of: The cost of 
transportation and subsistence incurred by the worker; the amount 
reimbursed; and the dates of reimbursement. Note that the FLSA applies 
independently of the H-2B requirements and imposes obligations on 
employers regarding payment of wages.
    (ii) Transportation from the place of employment. If the worker 
completes the period of employment covered by the job order (not 
counting any extensions), or if the worker is dismissed from employment 
for any reason by the employer before the end of the period, and the 
worker has no immediate subsequent H-2B employment, the employer must 
provide or pay at the time of departure for the worker's cost of return 
transportation and daily subsistence from the place of employment to the 
place from which the worker, disregarding intervening employment, 
departed to work for the employer. If the worker has contracted with a 
subsequent employer that has not agreed in the job order to provide or 
pay for the worker's transportation from the employer's worksite to such 
subsequent employer's worksite, the employer must provide or pay for 
that transportation and subsistence. If the worker has contracted with a 
subsequent employer that has agreed in the job order to provide or pay 
for the worker's transportation from the employer's worksite to such 
subsequent employer's worksite, the subsequent employer must provide or 
pay for such expenses.
    (iii) Employer-provided transportation. All employer-provided 
transportation must comply with all applicable Federal, State, and local 
laws and regulations and must provide, at a minimum, the same vehicle 
safety

[[Page 502]]

standards, driver licensure requirements, and vehicle insurance as 
required under 49 CFR parts 390, 393, and 396.
    (iv) Disclosure. All transportation and subsistence costs that the 
employer will pay must be disclosed in the job order.
    (2) The employer must pay or reimburse the worker in the first 
workweek for all visa, visa processing, border crossing, and other 
related fees (including those mandated by the government) incurred by 
the H-2B worker, but not for passport expenses or other charges 
primarily for the benefit of the worker.
    (k) Employer-provided items. The employer must provide to the 
worker, without charge or deposit charge, all tools, supplies, and 
equipment required to perform the duties assigned.
    (l) Disclosure of job order. The employer must provide to an H-2B 
worker if outside of the U.S. no later than the time at which the worker 
applies for the visa, or to a worker in corresponding employment no 
later than on the day work commences, a copy of the job order including 
any subsequent approved modifications. For an H-2B worker changing 
employment from an H-2B employer to a subsequent H-2B employer, the copy 
must be provided no later than the time an offer of employment is made 
by the subsequent H-2B employer. The disclosure of all documents 
required by this paragraph must be provided in a language understood by 
the worker, as necessary or reasonable.
    (m) Notice of worker rights. The employer must post and maintain in 
a conspicuous location at the place of employment a poster provided by 
the Department which sets out the rights and protections for H-2B 
workers and workers in corresponding employment. The employer must post 
the poster in English. To the extent necessary, the employer must 
request and post additional posters, as made available by the 
Department, in any language common to a significant portion of the 
workers if they are not fluent in English.
    (n) No unfair treatment. The employer has not and will not 
intimidate, threaten, restrain, coerce, blacklist, discharge or in any 
manner discriminate against, and has not and will not cause any person 
to intimidate, threaten, restrain, coerce, blacklist, discharge, or in 
any manner discriminate against, any person who has:
    (1) Filed a complaint under or related to 8 U.S.C. 1184(c), 29 CFR 
part 503, or this subpart, or any other Department regulation 
promulgated thereunder;
    (2) Instituted or caused to be instituted any proceeding under or 
related to 8 U.S.C. 1184(c), 29 CFR part 503, or this subpart or any 
other Department regulation promulgated thereunder;
    (3) Testified or is about to testify in any proceeding under or 
related to 8 U.S.C. 1184(c), 29 CFR part 503, or this subpart or any 
other Department regulation promulgated thereunder;
    (4) Consulted with a workers' center, community organization, labor 
union, legal assistance program, or an attorney on matters related to 8 
U.S.C. 1184(c), 29 CFR part 503, or this subpart or any other Department 
regulation promulgated thereunder; or
    (5) Exercised or asserted on behalf of himself/herself or others any 
right or protection afforded by 8 U.S.C. 1184(c), 29 CFR part 503, or 
this subpart or any other Department regulation promulgated thereunder.
    (o) Comply with the prohibitions against employees paying fees. The 
employer and its attorney, agents, or employees have not sought or 
received payment of any kind from the worker for any activity related to 
obtaining H-2B labor certification or employment, including payment of 
the employer's attorney or agent fees, application and H-2B Petition 
fees, recruitment costs, or any fees attributed to obtaining the 
approved Application for Temporary Employment Certification. For 
purposes of this paragraph, payment includes, but is not limited to, 
monetary payments, wage concessions (including deductions from wages, 
salary, or benefits), kickbacks, bribes, tributes, in kind payments, and 
free labor. All wages must be paid free and clear. This provision does 
not prohibit employers or their agents from receiving reimbursement for 
costs that are the responsibility and primarily for the benefit of the 
worker, such as government-required passport fees.
    (p) Contracts with third parties to comply with prohibitions. The 
employer must contractually prohibit in writing any agent or recruiter 
(or any agent or employee of such agent or recruiter) whom the employer 
engages, either directly or indirectly, in international recruitment of 
H-2B workers to seek or receive payments or other compensation from 
prospective workers. The contract must include the following statement: 
``Under this agreement, [name of agent, recruiter] and any agent of or 
employee of [name of agent or recruiter] are prohibited from seeking or 
receiving payments from any prospective employee of [employer name] at 
any time, including before or after the worker obtains employment. 
Payments include but are not limited to, any direct or indirect fees 
paid by such employees for recruitment, job placement, processing, 
maintenance, attorneys' fees, agent fees, application fees, or petition 
fees.''
    (q) Prohibition against preferential treatment of foreign workers. 
The employer's job offer must offer to U.S. workers no less than the 
same benefits, wages, and working conditions that the employer is 
offering, intends to offer, or will provide to H-2B workers. Job offers 
may not impose on U.S. workers any restrictions or obligations that will 
not be

[[Page 503]]

imposed on the employer's H-2B workers. This does not relieve the 
employer from providing to H-2B workers at least the minimum benefits, 
wages, and working conditions which must be offered to U.S. workers 
consistent with this section.
    (r) Non-discriminatory hiring practices. The job opportunity is, and 
through the period set forth in paragraph (t) of this section must 
continue to be, open to any qualified U.S. worker regardless of race, 
color, national origin, age, sex, religion, disability, or citizenship. 
Rejections of any U.S. workers who applied or apply for the job must 
only be for lawful, job-related reasons, and those not rejected on this 
basis have been or will be hired. In addition, the employer has and will 
continue to retain records of all hired workers and rejected applicants 
as required bySec. 655.56.
    (s) Recruitment requirements. The employer must conduct all required 
recruitment activities, including any additional employer-conducted 
recruitment activities as directed by the CO, and as specified in 
Sec.Sec. 655.40-655.46.
    (t) Continuing requirement to hire U.S. workers. The employer has 
and will continue to cooperate with the SWA by accepting referrals of 
all qualified U.S. workers who apply (or on whose behalf a job 
application is made) for the job opportunity, and must provide 
employment to any qualified U.S. worker who applies to the employer for 
the job opportunity, until 21 days before the date of need.
    (u) No strike or lockout. There is no strike or lockout at any of 
the employer's worksites within the area of intended employment for 
which the employer is requesting H-2B certification at the time the 
Application for Temporary Employment Certification is filed.
    (v) No recent or future layoffs. The employer has not laid off and 
will not lay off any similarly employed U.S. worker in the occupation 
that is the subject of the Application for Temporary Employment 
Certification in the area of intended employment within the period 
beginning 120 calendar days before the date of need through the end of 
the period of certification. A layoff for lawful, job-related reasons 
such as lack of work or the end of a season is permissible if all H-2B 
workers are laid off before any U.S. worker in corresponding employment.
    (w) Contact with former U.S. employees. The employer will contact 
(by mail or other effective means) its former U.S. workers, including 
those who have been laid off within 120 calendar days before the date of 
need (except those who were dismissed for cause or who abandoned the 
worksite), employed by the employer in the occupation at the place of 
employment during the previous year, disclose the terms of the job 
order, and solicit their return to the job.
    (x) Area of intended employment and job opportunity. The employer 
must not place any H-2B workers employed under the approved Application 
for Temporary Employment Certification outside the area of intended 
employment or in a job opportunity not listed on the approved 
Application for Temporary Employment Certification unless the employer 
has obtained a new approved Application for Temporary Employment 
Certification.
    (y) Abandonment/termination of employment. Upon the separation from 
employment of worker(s) employed under the Application for Temporary 
Employment Certification or workers in corresponding employment, if such 
separation occurs before the end date of the employment specified in the 
Application for Temporary Employment Certification, the employer must 
notify OFLC in writing of the separation from employment not later than 
2 work days after such separation is discovered by the employer. In 
addition, the employer must notify DHS in writing (or any other method 
specified by the Department or DHS in the Federal Register or the Code 
of Federal Regulations) of such separation of an H-2B worker. An 
abandonment or abscondment is deemed to begin after a worker fails to 
report for work at the regularly scheduled time for 5 consecutive 
working days without the consent of the employer. If the separation is 
due to the voluntary abandonment of employment by the H-2B worker or 
worker in corresponding employment, and the employer provides 
appropriate notification specified under this paragraph, the employer 
will not be responsible for providing or paying for the subsequent 
transportation and subsistence expenses of that worker under this 
section, and that worker is not entitled to the three-fourths guarantee 
described in paragraph (f) of this section. The employer's obligation to 
guarantee three-fourths of the work described in paragraph (f) ends with 
the last full 12-week period (or 6-week period, as appropriate) 
preceding the worker's voluntary abandonment or termination for cause.
    (z) Compliance with applicable laws. During the period of employment 
specified on the Application for Temporary Employment Certification, the 
employer must comply with all applicable Federal, State and local 
employment-related laws and regulations, including health and safety 
laws. In compliance with such laws, including the William Wilberforce 
Trafficking Victims Protection Reauthorization Act of 2008, 18 U.S.C. 
1592(a), neither the employer nor the employer's agents or attorneys may 
hold or confiscate workers' passports, visas, or other immigration 
documents.
    (aa) Disclosure of foreign worker recruitment. The employer, and its 
attorney or agent, as applicable, must comply withSec. 655.9 by 
providing a copy of all agreements with any agent or recruiter whom it 
engages or plans

[[Page 504]]

to engage in the international recruitment of H-2B workers, and the 
identity and location of the persons or entities hired by or working for 
the agent or recruiter and any of the agents or employees of those 
persons and entities, to recruit foreign workers. Pursuant toSec. 
655.15(a), the agreements and information must be filed with the 
Application for Temporary Employment Certification.



Sec.  655.21  Supporting evidence for temporary need.

    (a) Statement of temporary need. Each Application for Temporary 
Employment Certification must include attestations regarding temporary 
need in the appropriate sections. The employer must include a detailed 
statement of temporary need containing the following:
    (1) A description of the employer's business history and activities 
(i.e., primary products or services) and schedule of operations 
throughout the year;
    (2) An explanation regarding why the nature of the employer's job 
opportunity and number of foreign workers being requested for 
certification reflect a temporary need;
    (3) An explanation regarding how the request for temporary labor 
certification meets one of the regulatory standards of a one-time 
occurrence, seasonal, peakload, or intermittent need underSec. 
655.6(b) as defined by DHS under 8 CFR 214.2(h)(6)(ii)(B); and
    (4) If applicable, a statement justifying any increase or decrease 
in the number of H-2B positions being requested for certification from 
the previous year.
    (b) Request for supporting evidence. In circumstances where the CO 
requests evidence or documentation substantiating the employer's 
temporary need through a RFI underSec. 655.23(c) to support a Final 
Determination, or notifies the employer that its application is being 
audited underSec. 655.24, the employer must timely furnish the 
requested supplemental information or evidence or documentation. Failure 
to provide the information requested or late submissions may be grounds 
for the denial of the application. All such documentation or evidence 
becomes part of the record of the application.
    (c) Retention of documentation. The documentation required in this 
section and any other supporting evidence justifying the temporary need 
by the employer filing the Application for Temporary Employment 
Certification must be retained for a period of no less than 3 years from 
the date of the certification.

    Effective Date Note: At 77 FR 10160, Feb. 21, 2012,Sec. 655.21 was 
removed and reserved, effective Apr. 23, 2012.



Sec.  655.22  Obligations of H-2B employers.

    An employer seeking H-2B labor certification must attest as part of 
the Application for Temporary Employment Certification that it will 
abide by the following conditions of this subpart:
    (a) The employer is offering terms and working conditions normal to 
U.S. workers similarly employed in the area of intended employment, 
meaning that they may not be unusual for workers performing the same 
activity in the area of intended employment, and which are not less 
favorable than those offered to the H-2B worker(s) and are not less than 
the minimum terms and conditions required by this subpart.
    (b) The specific job opportunity for which the employer is 
requesting H-2B certification is not vacant because the former 
occupant(s) is (are) on strike or locked out in the course of a labor 
dispute involving a work stoppage.
    (c) The job opportunity is open to any qualified U.S. worker 
regardless of race, color, national origin, age, sex, religion, 
handicap, or citizenship, and the employer has conducted the required 
recruitment, in accordance with the regulations, and has been 
unsuccessful in locating sufficient numbers of qualified U.S. applicants 
for the job opportunity for which labor certification is sought. Any 
U.S. worker applicants were rejected only for lawful, job-related 
reasons, and the employer must retain records of all rejections.
    (d) During the period of employment that is the subject of the labor 
certification application, the employer will comply with applicable 
Federal, State and local employment-related laws and regulations, 
including employment-related health and safety laws;
    (e) The offered wage equals or exceeds the highest of the prevailing 
wage, the applicable Federal minimum wage, the State minimum wage, and 
local minimum wage, and the employer

[[Page 505]]

will pay the offered wage during the entire period of the approved H-2B 
labor certification.
    (f) Upon the separation from employment of H-2B worker(s) employed 
under the labor certification application, if such separation occurs 
prior to the end date of the employment specified in the application, 
the employer will notify the Department and DHS in writing (or any other 
method specified by the Department or DHS in the Federal Register or the 
Code of Federal Regulations) of the separation from employment not later 
than 2 work days after such separation is discovered by the employer. An 
abandonment or abscondment shall be deemed to begin after a worker fails 
to report for work at the regularly scheduled time for 5 consecutive 
working days without the consent of the employer. Employees may be 
terminated for cause.
    (g)(1) The offered wage is not based on commissions, bonuses, or 
other incentives, unless the employer guarantees a wage paid on a 
weekly, bi-weekly, or monthly basis that equals or exceeds the 
prevailing wage, or the legal Federal, State, or local minimum wage, 
whichever is highest. The employer must make all deductions from the 
worker's paychecks that are required by law. The job offer must specify 
all deductions not required by law that the employer will make from the 
worker's paycheck. All deductions must be reasonable. However, an 
employer subject to the FLSA may not make deductions that would violate 
the FLSA.
    (2) The employer has contractually forbidden any foreign labor 
contractor or recruiter whom the employer engages in international 
recruitment of H-2B workers to seek or receive payments from prospective 
employees, except as provided for in DHS regulations at 8 CFR 
214.2(h)(5)(xi)(A). This provision does not prohibit employers or their 
agents from receiving reimbursement for costs that are the 
responsibility of the worker, such as government required passport or 
visa fees.
    (h) The job opportunity is a bona fide, full-time temporary 
position, the qualifications for which are consistent with the normal 
and accepted qualifications required by non-H-2B employers in the same 
or comparable occupations.
    (i) The employer has not laid off and will not lay off any similarly 
employed U.S. worker in the occupation that is the subject of the 
Application for Temporary Employment Certification in the area of 
intended employment within the period beginning 120 calendar days before 
the date of need through 120 calendar days after the date of need, 
except where the employer also attests that it offered the job 
opportunity that is the subject of the application to those laid off 
U.S. worker(s) and the U.S. worker(s) either refused the job opportunity 
or was rejected for the job opportunity only for lawful, job-related 
reasons.
    (j) The employer and its attorney or agents have not sought or 
received payment of any kind from the employee for any activity related 
to obtaining the labor certification, including payment of the 
employer's attorneys' or agent fees, Application for Temporary 
Employment Certification, or recruitment costs. For purposes of this 
paragraph, payment includes, but is not limited to, monetary payments, 
wage concessions (including deductions from wages, salary, or benefits), 
kickbacks, bribes, tributes, in kind payments, and free labor.
    (k) If the employer is a job contractor, it will not place any H-2B 
workers employed pursuant to the labor certification application with 
any other employer or at another employer's worksite unless:
    (1) The employer applicant first makes a written bona fide inquiry 
as to whether the other employer has displaced or intends to displace 
any similarly employed U.S. workers within the area of intended 
employment within the period beginning 120 days before through 120 
calendar days after the date of need, and the other employer provides 
written confirmation that it has not so displaced and does not intend to 
displace such U.S. workers, and
    (2) All worksites are listed on the certified Application for 
Temporary Employment Certification, including amendments or 
modifications.
    (l) The employer will not place any H-2B workers employed pursuant 
to

[[Page 506]]

this application outside the area of intended employment listed on the 
Application for Temporary Employment Certification unless the employer 
has obtained a new temporary labor certification from the Department.
    (m) Unless the H-2B worker will be sponsored by another subsequent 
employer, the employer will inform H-2B workers of the requirement that 
they leave the U.S. at the end of the authorized period of stay provided 
by DHS or separation from the employer, whichever is earlier, as 
required inSec. 655.35 of this part (absent any extension or change of 
such worker's status or grace period pursuant to DHS regulations), and 
that if dismissed by the employer prior to the end of the period, the 
employer is liable for return transportation.
    (n) The dates of temporary need, reason for temporary need, and 
number of positions being requested for labor certification have been 
truly and accurately stated on the application.

    Effective Date Note: At 77 FR 10160, Feb. 21, 2012,Sec. 655.22 was 
removed and reserved, effective Apr. 23, 2012.



Sec.  655.23  Receipt and processing of applications.

    (a) Filing date. Applications received by U.S. Mail or private 
courier shall be considered filed when determined by the NPC to be 
complete. Incomplete applications shall not be accepted for processing 
or assigned a receipt date, but shall be returned by U.S. Mail to the 
employer or the employer's representative as incomplete.
    (b) Processing. The CO will review complete applications for an 
absence of errors that would prevent certification and for compliance 
with the criteria for certification. The CO will make a determination to 
certify, deny, or issue a Request for Further Information prior to 
making a Final Determination on the application. Criteria for 
certification, as used in this subpart, are whether the employer has: 
established the need for the nonagricultural services or labor to be 
performed is temporary in nature; established that the number of worker 
positions being requested for certification is justified and represent 
bona fide job opportunities; made all the assurances and met all the 
obligations required bySec. 655.22; and complied with all requirements 
of the program.
    (c) Request for further information. (1) If the CO determines that 
the employer has made all necessary attestations and assurances, but the 
application fails to comply with one or more of the criteria for 
certification in paragraph (b) of this section, the CO must issue a RFI 
to the employer. The CO will issue the written RFI within 7 calendar 
days of the receipt of the application, and send it by means normally 
assuring next-day delivery.
    (2) The RFI must:
    (i) Specify the reason(s) why the application is not sufficient to 
grant temporary labor certification, citing the relevant regulatory 
standard(s) and/or special procedure(s);
    (ii) Specify a date, no later than 7 calendar days from the date of 
the written RFI, by which the supplemental information and documentation 
must be received by the CO to be considered; and
    (iii) State that, upon receipt of a response to the written RFI, or 
expiration of the stated deadline for receipt of the response, the CO 
will review the existing application as well as any supplemental 
materials submitted by the employer and issue a Final Determination. If 
unusual circumstances warrant, the CO may issue one or more additional 
RFIs prior to issuing a Final Determination.
    (3) The CO will issue the Final Determination or the additional RFI 
within 7 business days of receipt of the employer's response, or within 
60 days of the employer's date of need, whichever is later.
    (4) Compliance with an RFI does not guarantee that the employer's 
application will be certified after submitting the information. The 
employer's documentation must justify its chosen standard of temporary 
need or otherwise overcome the stated deficiency in the application.
    (d) Failure to comply with an RFI, including not providing all 
documentation within the specified time period, may result in a denial 
of the application. Such failure to comply with an RFI may also result 
in a finding by the CO requiring supervised recruitment

[[Page 507]]

underSec. 655.30 in future filings of H-2B temporary labor 
certification applications.

    Effective Date Note: At 77 FR 10160, Feb. 21, 2012,Sec. 655.23 was 
removed and reserved, effective Apr. 23, 2012.



Sec.  655.24  Audits.

    (a) Discretion. OFLC will conduct audits of H-2B temporary labor 
certification applications. The applications selected for audit will be 
chosen within the sole discretion of OFLC.
    (b) Audit letter. When an application is selected for audit, the CO 
shall issue an audit letter to the employer. The audit letter will:
    (1) State the application has been selected for audit and note 
documentation that must be submitted by the employer;
    (2) Specify a date, no fewer than 14 days and no more than 30 days 
from the date of the audit letter's issuance, by which the required 
documentation must be received by the CO; and
    (3) Advise that failure to comply with the audit process may result 
in a finding by the CO to:
    (i) Require the employer to conduct supervised recruitment under 
Sec.  655.30 in future filings of H-2B temporary labor certification 
applications for a period of up to 2 years, or
    (ii) Debar the employer from future filings of H-2B temporary labor 
certification applications as provided inSec. 655.31.
    (c) Supplemental information. During the course of the audit 
examination, the CO may request supplemental information and/or 
documentation from the employer to complete the audit.
    (d) Audit violations. If, as a result of the audit, the CO 
determines the employer failed to produce all required documentation, or 
determines that the employer made a material misrepresentation with 
respect to the application, the employer may be required to conduct 
supervised recruitment underSec. 655.30 in future filings of H-2B 
temporary labor certification applications for up to 2 years, or may be 
subject to debarment pursuant toSec. 655.31 or other sanctions. The CO 
may provide the audit findings and underlying documentation to DHS, WHD, 
or another appropriate enforcement agency. The CO may refer any findings 
that an employer discouraged an eligible U.S. worker from applying, or 
failed to hire, discharged, or otherwise discriminated against an 
eligible U.S. worker, to the Department of Justice, Civil Rights 
Division, Office of Special Counsel for Unfair Immigration Related 
Employment Practices.

    Effective Date Note: At 77 FR 10160, Feb. 21, 2012,Sec. 655.24 was 
removed and reserved, effective Apr. 23, 2012.



Sec.Sec. 655.25-655.29  [Reserved]

   Processing of an Application for Temporary Employment Certification

    Effective Date Note: At 77 FR 10160, Feb. 21, 2012, an undesignated 
center heading was added beforeSec. 655.30, effective Apr. 23, 2012.



Sec.  655.30  Supervised recruitment.

    (a) Supervised recruitment. Where an employer is found to have 
violated program requirements, to have made a material misrepresentation 
to the Department, or to have failed to adequately conduct recruitment 
activities or failed in any obligation of this part, the CO may require 
pre-filing supervised recruitment.
    (b) Requirements. Supervised recruitment shall consist of 
advertising for the job opportunity or opportunities in accordance with 
the required recruitment steps outlined underSec. 655.15, except as 
otherwise provided below.
    (1) The CO will direct where the advertisements are to be placed.
    (2) The employer must supply a draft advertisement and job order to 
the CO for review and approval no fewer than 150 days before the date on 
which the foreign worker(s) will commence work unless notified by the CO 
of the need for Supervised Recruitment less than 150 days before the 
date of need, in which case the employer must supply the drafts within 
30 days of receipt of such notification.
    (3) Each advertisement must comply with the requirements ofSec. 
655.17(a).
    (4) The advertisement shall be placed in accordance with guidance 
provided by the CO.
    (5) The employer will notify the CO when the advertisements are 
placed.

[[Page 508]]

    (c) Recruitment report. No fewer than 2 days after the last day of 
the posting of the job order and no fewer than 5 calendar days after the 
date on which the last newspaper or journal advertisement appeared, the 
employer must prepare a detailed written report of the employer's 
supervised recruitment, signed by the employer as outlined inSec. 
655.15(i). The employer must submit the recruitment report to the CO 
within 30 days of the date of the first advertisement and must retain a 
copy for a period of no less than 3 years. The recruitment report must 
contain a copy of all advertisements and a copy of the SWA job order, 
including the dates so placed.
    (d) The CO may refer any findings that an employer or its 
representative discouraged an eligible U.S. worker from applying, or 
failed to hire, discharged, or otherwise discriminated against an 
eligible U.S. worker, to the Department of Justice, Civil Rights 
Division, Office of Special Counsel for Unfair Immigration Related 
Employment Practices.

    Effective Date Note: At 77 FR 10160, Feb. 21, 2012,Sec. 655.30 was 
revised, effective Apr. 23, 2012. For the convenience of the user, the 
revised text is set forth as follows:



Sec.  655.30  Processing of an application and job order.

    (a) NPC review. The CO will review the Application for Temporary 
Employment Certification and job order for compliance with all 
applicable program requirements.
    (b) Mailing and postmark requirements. Any notice or request sent by 
the CO to an employer requiring a response will be mailed to the address 
provided in the Application for Temporary Employment Certification using 
methods to assure next day delivery, including electronic mail. The 
employer's response to such a notice or request must be mailed using 
methods to assure next day delivery, including electronic mail, and be 
sent by the due date or the next business day if the due date falls on a 
Saturday, Sunday or Federal holiday.
    (c) Information dissemination. OFLC may forward information received 
in the course of processing an Application for Temporary Employment 
Certification and program integrity measures to WHD, or any other 
Federal agency, as appropriate, for investigation and/or enforcement 
purposes.



Sec.  655.31  Debarment.

    (a) The Administrator, OFLC may not issue future labor 
certifications under this subpart to an employer and any successor in 
interest to the debarred employer, subject to the time limits set forth 
in paragraph (c) of this section, if:
    (1) The Administrator, OFLC finds that the employer substantially 
violated a material term or condition of its temporary labor 
certification with respect to the employment of domestic or nonimmigrant 
workers; and
    (2) The Administrator, OFLC issues a Notice of Intent to Debar no 
later than 2 years after the occurrence of the violation.
    (b) The Administrator, OFLC may not issue future labor 
certifications under this subpart to an employer represented by an agent 
or attorney, subject to the time limits set forth in paragraph (c) of 
this section, if:
    (1) The agent or attorney participated in, had knowledge of, or had 
reason to know of, the employer's substantial violation; and
    (2) The Administrator issues the agent or attorney a Notice of 
Intent to Debar no later than 2 years after the occurrence of the 
violation.
    (c) No employer, attorney, or agent may be debarred under this 
subpart for more than 3 years.
    (d) For the purposes of this section, a substantial violation 
includes:
    (1) A pattern or practice of acts of commission or omission on the 
part of the employer or the employer's agent that:
    (i) Are significantly injurious to the wages or benefits offered 
under the H-2B program or working conditions of a significant number of 
the employer's U.S. or H-2B workers;
    (ii) Reflect a significant failure to offer employment to each 
qualified domestic worker who applied for the job opportunity for which 
certification was being sought, except for lawful job-related reasons;
    (iii) Reflect a significant failure to comply with the employer's 
obligations to recruit U.S. workers as set forth in this subpart;
    (iv) Reflect a significant failure to comply with the RFI or audit 
process pursuant to Sec.Sec. 655.23 or 655.24;

[[Page 509]]

    (v) Reflect the employment of an H-2B worker outside the area of 
intended employment, or in an activity/activities, not listed in the job 
order (other than an activity minor and incidental to the activity/
activities listed in the job order), or after the period of employment 
specified in the job order and any approved extension; or
    (vi) Reflect a significant failure to comply with the supervised 
recruitment process pursuant toSec. 655.30.
    (2) Fraud involving the Application for Temporary Employment 
Certification or a response to an audit;
    (3) A significant failure to cooperate with a DOL investigation or 
with a DOL official performing an investigation, inspection, or law 
enforcement function under this subpart;
    (4) A significant failure to comply with one or more sanctions or 
remedies imposed by the ESA for violation(s) of obligations under this 
subpart found by that agency (if applicable), or with one or more 
decisions or orders of the Secretary or a court order secured by the 
Secretary; or
    (5) A single heinous act showing such flagrant disregard for the law 
that future compliance with program requirements cannot reasonably be 
expected.
    (e) DOL procedures for debarment under this section will be as 
follows:
    (1) The Administrator, OFLC will send to the employer, attorney, or 
agent a Notice of Intent to Debar by means normally ensuring next-day 
delivery, which will contain a detailed statement of the grounds for the 
proposed debarment. The employer, attorney, or agent may submit evidence 
in rebuttal within 14 calendar days of the date the notice is issued. 
The Administrator, OFLC must consider all relevant evidence presented in 
deciding whether to debar the employer, attorney, or agent.
    (2) If rebuttal evidence is not timely filed by the employer, 
attorney, or agent, the Notice of Intent to Debar will become the final 
decision of the Secretary and take effect immediately at the end of the 
14-day period.
    (3) If, after reviewing the employer's timely filed rebuttal 
evidence, the Administrator, OFLC determines that the employer, 
attorney, or agent more likely than not meets one or more of the bases 
for debarment underSec. 655.31(d), the Administrator, OFLC will notify 
the employer, by means normally ensuring next-day delivery, within 14 
calendar days after receiving such timely filed rebuttal evidence, of 
his/her final determination of debarment and of the employer, attorney, 
or agent's right to appeal.
    (4) The Notice of Debarment must be in writing, must state the 
reason for the debarment finding, including a detailed explanation of 
the grounds for and the duration of the debarment, and must offer the 
employer, attorney, or agent an opportunity to request a hearing. The 
notice must state that to obtain such a review or hearing, the debarred 
party must, within 30 calendar days of the date of the notice file a 
written request to the Chief Administrative Law Judge, United States 
Department of Labor, 800 K Street, NW., Suite 400-N, Washington, DC 
20001-8002, and simultaneously serve a copy to the Administrator, OFLC. 
The debarment will take effect 30 days from the date the Notice of 
Debarment is issued, unless a request for a hearing is properly filed 
within 30 days from the date the Notice of Debarment is issued. The 
timely filing of a request for a hearing stays the debarment pending the 
outcome of the appeal.
    (5)(i) Hearing. Within 10 days of receipt of the request for a 
hearing, the Administrator, OFLC will send a certified copy of the ETA 
case file to the Chief Administrative Law Judge by means normally 
assuring next-day delivery. The Chief Administrative Law Judge will 
immediately assign an ALJ to conduct the hearing. The procedures in 29 
CFR part 18 apply to such hearings, except that the request for a 
hearing will not be considered to be a complaint to which an answer is 
required.
    (ii) Decision. After the hearing, the ALJ must affirm, reverse, or 
modify the Administrator, OFLC 's determination. The ALJ's decision must 
be provided immediately to the employer, Administrator, OFLC, DHS, and 
DOS by means normally assuring next-day delivery. The ALJ's decision is 
the final decision of the Secretary, unless either party, within 30 
calendar days of the ALJ's decision, seeks review of the

[[Page 510]]

decision with the Administrative Review Board (ARB).
    (iii) Review by the ARB.
    (A) Any party wishing review of the decision of an ALJ must, within 
30 days of the decision of the ALJ, petition the ARB to review the 
decision. Copies of the petition must be served on all parties and on 
the ALJ. The ARB must decide whether to accept the petition within 30 
days of receipt. If the ARB declines to accept the petition or if the 
ARB does not issue a notice accepting a petition within 30 days after 
the receipt of a timely filing of the petition, the decision of the ALJ 
shall be deemed the final agency action. If a petition for review is 
accepted, the decision of the ALJ shall be stayed unless and until the 
ARB issues an order affirming the decision. The ARB must serve notice of 
its decision to accept or not to accept the petition upon the ALJ and 
upon all parties to the proceeding in person or by certified mail.
    (B) Upon receipt of the ARB's notice to accept the petition, the 
Office of Administrative Law Judges shall promptly forward a copy of the 
complete hearing record to the ARB.
    (C) Where the ARB has determined to review such decision and order, 
the ARB shall notify each party of:
    (1) The issue or issues raised;
    (2) The form in which submissions shall be made (i.e., briefs, oral 
argument, etc.); and
    (3) The time within which such presentation shall be submitted.
    (D) The ARB's final decision must be issued within 90 days from the 
notice granting the petition and served upon all parties and the ALJ, in 
person or by certified mail. If the ARB fails to provide a decision 
within 90 days from the notice granting the petition, the ALJ's decision 
will be the final decision of the Secretary.
    (f) Inter-agency reporting. After completion of the appeal process, 
DOL will inform DHS and other appropriate enforcement agencies of the 
findings and provide a copy of the Notice of Debarment.

    Effective Date Note: At 77 FR 10160, Feb. 21, 2012,Sec. 655.31 was 
revised, effective Apr. 23, 2012. For the convenience of the user, the 
revised text is set forth as follows:



Sec.  655.31  Notice of deficiency.

    (a) Notification timeline. If the CO determines the Application for 
Temporary Employment Certification and/or job order is incomplete, 
contains errors or inaccuracies, or does not meet the requirements set 
forth in this subpart, the CO will notify the employer within 7 business 
days from the CO's receipt of the Application for Temporary Employment 
Certification. If applicable, the Notice of Deficiency will include job 
order deficiencies identified by the SWA underSec. 655.16. The CO will 
send a copy of the Notice of Deficiency to the SWA serving the area of 
intended employment identified by the employer on its job order, and if 
applicable, to the employer's attorney or agent.
    (b) Notice content. The Notice of Deficiency will:
    (1) State the reason(s) why the Application for Temporary Employment 
Certification or job order fails to meet the criteria for acceptance and 
state the modification needed for the CO to issue a Notice of 
Acceptance;
    (2) Offer the employer an opportunity to submit a modified 
Application for Temporary Employment Certification or job order within 
10 business days from the date of the Notice of Deficiency. The Notice 
will state the modification needed for the CO to issue a Notice of 
Acceptance;
    (3) Offer the employer an opportunity to request administrative 
review of the Notice of Deficiency before an ALJ under provisions set 
forth inSec. 655.61. The notice will inform the employer that it must 
submit a written request for review to the Chief ALJ of DOL within 10 
business days from the date the Notice of Deficiency is issued by 
facsimile or other means normally assuring next day delivery, and that 
the employer must simultaneously serve a copy on the CO. The notice will 
also state that the employer may submit any legal arguments that the 
employer believes will rebut the basis of the CO's action; and
    (4) State that if the employer does not comply with the requirements 
of this section by either submitting a modified application within 10 
business days or requesting administrative review before an ALJ under 
Sec.  655.61, the CO will deny the Application for Temporary Employment 
Certification. The notice will inform the employer that the denial of 
the Application for Temporary Employment Certification is final, and 
cannot be appealed. The Department will not further consider that 
Application for Temporary Employment Certification.



Sec.  655.32  Labor certification determinations.

    (a) COs. The Administrator, OFLC, is the Department's National CO. 
The Administrator, and the CO(s) in the NPC

[[Page 511]]

(by virtue of delegation from the Administrator), have the authority to 
certify or deny applications for temporary employment certification 
under the H-2B nonimmigrant classification. If the Administrator directs 
that certain types of temporary labor certification applications or 
specific applications under the H-2B nonimmigrant classification be 
handled by the National OFLC, the Director of the Chicago NPC will refer 
such applications to the Administrator.
    (b) Determination. The CO will make a determination either to grant 
or deny the Application for Temporary Employment Certification. The CO 
will grant the application if and only if the employer has met all the 
requirements of this subpart, including the criteria for certification 
defined inSec. 655.23(b), thus demonstrating that an insufficient 
number of qualified U.S. workers are available for the job opportunity 
for which certification is sought and the employment of the H-2B workers 
will not adversely affect the benefits, wages, and working conditions of 
similarly employed U.S. workers.
    (c) Notice. The CO will notify the employer in writing (either 
electronically or by U.S. Mail) of the labor certification 
determination.
    (d) Approved certification. If temporary labor certification is 
granted, the CO must send the certified Application for Temporary 
Employment Certification and a Final Determination letter to the 
employer, or, if appropriate, to the employer's agent or attorney with a 
copy to the employer. The Final Determination letter will notify the 
employer to file the certified application and any other documentation 
required by USCIS with the appropriate USCIS office.
    (e) Denied certification. If temporary labor certification is 
denied, the Final Determination letter will:
    (1) State the reason(s) certification is denied, citing the relevant 
regulatory standards and/or special procedures;
    (2) If applicable, address the availability of U.S. workers in the 
occupation as well as the prevailing benefits, wages, and working 
conditions of similarly employed U.S. workers in the occupation and/or 
any applicable special procedures;
    (3) Offer the employer an opportunity to request administrative 
review of the denial available underSec. 655.33, or to file a new 
application in accordance with specific instructions provided by the CO; 
and
    (4) State that if the employer does not request administrative 
review in accordance withSec. 655.33, the denial is final and the 
Department will not further consider that application for temporary 
alien nonagricultural labor certification.
    (f) Partial certification. The CO may, in his/her discretion, and to 
ensure compliance with all statutory and regulatory requirements, issue 
a partial certification, reducing either the period of need, the number 
of H-2B positions being requested, or both, based upon information the 
CO receives in the course of processing the temporary labor 
certification application, an RFI, or otherwise. If a partial labor 
certification is issued, the Final Determination letter will:
    (1) State the reason(s) for which either the period of need and/or 
the number of H-2B positions requested has been reduced, citing the 
relevant regulatory standards and/or special procedures;
    (2) If applicable, address the availability of U.S. workers in the 
occupation;
    (3) Offer the employer an opportunity to request administrative 
review of the partial labor certification available underSec. 655.33; 
and
    (4) State that if the employer does not request administrative 
review in accordance withSec. 655.33, the partial labor certification 
is final and the Department will not further consider that application 
for temporary nonagricultural labor certification.

    Effective Date Note: At 77 FR 10160, Feb. 21, 2012,Sec. 655.32 was 
revised, effective Apr. 23, 2012. For the convenience of the user, the 
revised text is set forth as follows:



Sec.  655.32  Submission of a modified application or job order.

    (a) Review of a modified Application for Temporary Employment 
Certification or job order. Upon receipt of a response to a Notice of 
Deficiency, including any modifications, the CO will review the 
response. The CO may issue one or more additional Notices of Deficiency 
before issuing a Notice of Decision. The employer's failure to comply 
with a Notice of

[[Page 512]]

Deficiency, including not responding in a timely manner or not providing 
all required documentation, will result in a denial of the Application 
for Temporary Employment Certification.
    (b) Acceptance of a modified Application for Temporary Employment 
Certification or job order. If the CO accepts the modification(s) to the 
Application for Temporary Employment Certification and/or job order, the 
CO will issue a Notice of Acceptance to the employer. The CO will send a 
copy of the Notice of Acceptance to the SWA instructing it to make any 
necessary modifications to the not yet posted job order and, if 
applicable, to the employer's attorney or agent, and follow the 
procedure set forth inSec. 655.33.
    (c) Denial of a modified Application for Temporary Employment 
Certification or job order. If the CO finds the response to Notice of 
Deficiency unacceptable, the CO will deny the Application for Temporary 
Employment Certification in accordance with the labor certification 
determination provisions inSec. 655.51.
    (d) Appeal from denial of a modified Application for Temporary 
Employment Certification or job order. The procedures for appealing a 
denial of a modified Application for Temporary Employment Certification 
and/or job order are the same as for appealing the denial of a non-
modified Application for Temporary Employment Certification outlined in 
Sec.  655.61.
    (e) Post acceptance modifications. Irrespective of the decision to 
accept the Application for Temporary Employment Certification, the CO 
may require modifications to the job order at any time before the final 
determination to grant or deny the Application for Temporary Employment 
Certification if the CO determines that the offer of employment does not 
contain all the minimum benefits, wages, and working condition 
provisions as set forth inSec. 655.18. The employer must make such 
modification, or certification will be denied underSec. 655.53. The 
employer must provide all workers recruited in connection with the job 
opportunity in the Application for Temporary Employment Certification 
with a copy of the modified job order no later than the date work 
commences, as approved by the CO.



Sec.  655.33  Administrative review.

    (a) Request for review. If a temporary labor certification is 
denied, in whole or in part, underSec. 655.32, the employer may 
request review of the denial by the BALCA. The request for review:
    (1) Must be sent to the BALCA, with a copy simultaneously sent to 
the CO who denied the application, within 10 calendar days of the date 
of determination;
    (2) Must clearly identify the particular temporary labor 
certification determination for which review is sought;
    (3) Must set forth the particular grounds for the request;
    (4) Must include a copy of the Final Determination; and
    (5) May contain only legal argument and such evidence as was 
actually submitted to the CO in support of the application.
    (b) Upon the receipt of a request for review, the CO shall, within 5 
business days assemble and submit the Appeal File using means to ensure 
same day or overnight delivery, to the BALCA, the employer, and the 
Associate Solicitor for Employment and Training Legal Services, Office 
of the Solicitor, U.S. Department of Labor.
    (c) Within 5 business days of receipt of the Appeal File, the 
counsel for the CO may submit, using means to ensure same day or 
overnight delivery, a brief in support of the CO's decision.
    (d) The Chief Administrative Law Judge may designate a single member 
or a three member panel of the BALCA to consider a particular case.
    (e) The BALCA must review a denial of temporary labor certification 
only on the basis of the Appeal File, the request for review, and any 
legal briefs submitted and must:
    (1) Affirm the denial of the temporary labor certification; or
    (2) Direct the CO to grant the certification; or
    (3) Remand to the CO for further action.
    (f) The BALCA should notify the employer, the CO, and counsel for 
the CO of its decision within 5 business days of the submission of the 
CO's brief or 10 days after receipt of the Appeal File, whichever is 
earlier, using means to ensure same day or overnight delivery.

    Effective Date Note: At 77 FR 10160, Feb. 21, 2012,Sec. 655.33 was 
revised, effective Apr. 23, 2012. For the convenience of the user, the 
revised text is set forth as follows:



Sec.  655.33  Notice of acceptance.

    (a) Notification timeline. If the CO determines the Application for 
Temporary Employment Certification and job order are complete and meet 
the requirements of this subpart, the CO will notify the employer in 
writing within 7 business days from the date the CO

[[Page 513]]

received the Application for Temporary Employment Certification and job 
order or modification thereof. A copy of the Notice of Acceptance will 
be sent to the SWA serving the area of intended employment identified by 
the employer on its job order and, if applicable, to the employer's 
attorney or agent.
    (b) Notice content. The notice will:
    (1) Direct the employer to engage in recruitment of U.S. workers as 
provided in Sec.Sec. 655.40-655.46, including any additional 
recruitment ordered by the CO underSec. 655.46;
    (2) State that such employer-conducted recruitment is in addition to 
the job order being circulated by the SWA(s) and that the employer must 
conduct recruitment within 14 calendar days from the date the Notice of 
Acceptance is issued, consistent withSec. 655.40;
    (3) Direct the SWA to place the job order into intra- and interstate 
clearance as set forth inSec. 655.16 and to commence such clearance 
by:
    (i) Sending a copy of the job order to other States listed as 
anticipated worksites in the Application for Temporary Employment 
Certification and job order, if applicable; and
    (ii) Sending a copy of the job order to the SWAs for all States 
designated by the CO for interstate clearance;
    (4) Instruct the SWA to keep the approved job order on its active 
file until the end of the recruitment period as defined inSec. 
655.40(c), and to transmit the same instruction to other SWAs to which 
it circulates the job order in the course of interstate clearance;
    (5) Where the occupation or industry is traditionally or customarily 
unionized, direct the SWA to circulate a copy of the job order to the 
following labor organizations:
    (i) The central office of the State Federation of Labor in the 
State(s) in which work will be performed; and
    (ii) The office(s) of local union(s) representing employees in the 
same or substantially equivalent job classification in the area(s) in 
which work will be performed;
    (6) Advise the employer, as appropriate, that it must contact the 
appropriate designated community-based organization(s) with notice of 
the job opportunity; and
    (7) Require the employer to submit a report of its recruitment 
efforts as specified inSec. 655.48.



Sec.  655.34  Validity of temporary labor certifications.

    (a) Validity period. A temporary labor certification is valid only 
for the period of time between the beginning and ending dates of 
employment, as certified by the OFLC Administrator on the Application 
for Temporary Employment Certification. The certification expires on the 
last day of authorized employment.
    (b) Scope of validity. A temporary labor certification is valid only 
for the number of H-2B positions, the area of intended employment, the 
specific services or labor to be performed, and the employer specified 
on the certified Application for Temporary Employment Certification and 
may not be transferred from one employer to another.
    (c) Amendments to applications. (1) Applications may be amended at 
any time, before the CO's certification determination, to increase the 
number of positions requested in the initial application by not more 
than 20 percent (50 percent for employers requesting less than 10 
positions) without requiring an additional recruitment period for U.S. 
workers. Requests for increases above the percent prescribed, without 
additional recruitment, may be approved by the CO only when the request 
is submitted in writing, the need for additional workers could not have 
been reasonably foreseen, and the employer's services or products will 
be in jeopardy prior to the time that new H-2B workers could be secured.
    (2) Applications may be amended to make minor changes in the period 
of employment, only when a written request is submitted to the CO and 
written approval obtained in advance. In considering whether to approve 
the request, the CO will review the reason(s) for the request, determine 
whether the reason(s) are on the whole justified, and take into account 
the effect(s) of a decision to approve on the adequacy of the underlying 
test of the domestic labor market for the job opportunity.
    (3) Other amendments to the application, including elements of the 
job offer and the place of work, may be requested, in writing, and will 
be granted if the CO determines the proposed amendment(s) are justified 
and will have no significant effect upon the CO's ability to make the 
labor certification determination required underSec. 655.32.
    (4) The CO may change the date of need to reflect an amended date 
when delays occur in the adjudication of the Application for Temporary 
Employment Certification, through no fault of the employer, and the 
certification would

[[Page 514]]

otherwise become valid after the initial date of need.

    Effective Date Note: At 77 FR 10160, Feb. 21, 2012,Sec. 655.34 was 
revised, effective Apr. 23, 2012. For the convenience of the user, the 
revised text is set forth as follows:



Sec.  655.34  Electronic job registry.

    (a) Location of and placement in the electronic job registry. Upon 
acceptance of the Application for Temporary Employment Certification 
underSec. 655.33, the CO will place for public examination a copy of 
the job order posted by the SWA on the Department's electronic job 
registry, including any amendments or required modifications approved by 
the CO.
    (b) Length of posting on electronic job registry. The Department 
will keep the job order posted on the electronic job registry until the 
end of the recruitment period, as set forth inSec. 655.40(c).
    (c) Conclusion of active posting. Once the recruitment period has 
concluded the job order will be placed in inactive status on the 
electronic job registry.



Sec.  655.35  Required departure.

    (a) Limit to worker's stay. As defined further in DHS regulations, a 
temporary labor certification shall limit the authorized period of stay 
for any H-2B worker whose admission is based upon it. 8 CFR 
214.2(h)(13). A foreign worker may not remain in the U.S. beyond the 
validity period of admission by DHS in H-2B status nor beyond separation 
from employment, whichever occurs first, absent any extension or change 
of such worker's status or grace period pursuant to DHS regulations.
    (b) Notice to worker. Upon establishment of a pilot program by DHS 
for registration of departure, the employer must notify any H-2B worker 
starting work at a job opportunity for which the employer has obtained 
labor certification that the H-2B worker, when departing the U.S. by 
land at the conclusion of employment as described in paragraph (a) of 
this section, must register such departure at the place and in the 
manner prescribed by DHS. This requirement will apply only to H-2B 
foreign workers entering from ports of entry participating in the DHS 
pilot program.

    Effective Date Note: At 77 FR 10160, Feb. 21, 2012,Sec. 655.35 was 
revised, effective Apr. 23, 2012. For the convenience of the user, the 
revised text is set forth as follows:



Sec.  655.35  Amendments to an application or job order.

    (a) Increases in number of workers. The employer may request to 
increase the number of workers noted in the H-2B Registration by no more 
than 20 percent (50 percent for employers requesting fewer than 10 
workers). All requests for increasing the number of workers must be made 
in writing and will not be effective until approved by the CO. In 
considering whether to approve the request, the CO will determine 
whether the proposed amendment(s) are sufficiently justified and must 
take into account the effect of the changes on the underlying labor 
market test for the job opportunity. Upon acceptance of an amendment, 
the CO will submit to the SWA any necessary changes to the job order and 
update the electronic job registry. The employer must promptly provide 
copies of any approved amendments to all U.S. workers hired under the 
original job order.
    (b) Minor changes to the period of employment. The employer may 
request minor changes to the total period of employment listed on its 
Application for Temporary Employment Certification and job order, for a 
period of up to 14 days, but the period of employment may not exceed a 
total of 9 months, except in the event of a one-time occurrence. All 
requests for minor changes to the total period of employment must be 
made in writing and will not be effective until approved by the CO. In 
considering whether to approve the request, the CO will determine 
whether the proposed amendment(s) are sufficiently justified and must 
take into account the effect of the changes on the underlying labor 
market test for the job opportunity. Upon acceptance of an amendment, 
the CO will submit to the SWA any necessary changes to the job order and 
update the electronic job registry. The employer must promptly provide 
copies of any approved amendments to all U.S. workers hired under the 
original job order.
    (c) Other amendments to the Application for Temporary Employment 
Certification and job order. The employer may request other amendments 
to the Application for Temporary Employment Certification and job order. 
All such requests must be made in writing and will not be effective 
until approved by the CO. In considering whether to approve the request, 
the CO will determine whether the proposed amendment(s) are sufficiently 
justified and must take into account the effect of the changes on the 
underlying labor market test for the job opportunity. Upon acceptance of 
an amendment, the CO will submit to the SWA any necessary changes to the 
job order and update the electronic job registry.
    (d) Amendments after certification are not permitted. The employer 
must promptly provide copies of any approved amendments to

[[Page 515]]

all U.S. workers hired under the original job order.



Sec.Sec. 655.36-655.39  [Reserved]

    Effective Date Note: At 77 FR 10162, Feb. 21, 2012, Sec.Sec. 
655.36-655.39 were added and reserved, effective Apr. 23, 2012.

                      Post-Acceptance Requirements

    Effective Date Note: At 77 FR 10162, Feb. 21, 2012, an undesignated 
center heading was added beforeSec. 655.40, effective Apr. 23, 2012.



Sec.  655.40  Employer-conducted recruitment.

    (a) Employer obligations. Employers must conduct recruitment of U.S. 
workers to ensure that there are not qualified U.S. workers who will be 
available for the positions listed in the Application for Temporary 
Employment Certification. U.S. Applicants can be rejected only for 
lawful job-related reasons.
    (b) Employer-conducted recruitment period. Unless otherwise 
instructed by the CO, the employer must conduct the recruitment 
described in Sec.Sec. 655.42-655.46 within 14 calendar days from the 
date the Notice of Acceptance is issued. All employer-conducted 
recruitment must be completed before the employer submits the 
recruitment report as required inSec. 655.48.
    (c) U.S. worker referrals. Employers must continue to accept 
referrals of all U.S. applicants interested in the position until 21 
days before the date of need.
    (d) Interviewing U.S. workers. Employers that wish to require 
interviews must conduct those interviews by phone or provide a procedure 
for the interviews to be conducted in the location where the worker is 
being recruited so that the worker incurs little or no cost. Employers 
cannot provide potential H-2B workers with more favorable treatment with 
respect to the requirement for, and conduct of, interviews.
    (e) Qualified and available U.S. workers. The employer must consider 
all U.S. applicants for the job opportunity. The employer must accept 
and hire any applicants who are qualified and who will be available.
    (f) Recruitment report. The employer must prepare a recruitment 
report meeting the requirements ofSec. 655.48.

[77 FR 10162, Feb. 21, 2012]

    Effective Date Note: At 77 FR 10162, Feb. 21, 2012,Sec. 655.40 was 
added, effective Apr. 23, 2012.



Sec.  655.41  Advertising requirements.

    (a) All recruitment conducted under Sec.Sec. 655.42-655.46 must 
contain terms and conditions of employment that are not less favorable 
than those offered to the H-2B workers and, at a minimum, must comply 
with the assurances applicable to job orders as set forth inSec. 
655.18(a).
    (b) All advertising must contain the following information:
    (1) The employer's name and contact information;
    (2) The geographic area of intended employment with enough 
specificity to apprise applicants of any travel requirements and where 
applicants will likely have to reside to perform the services or labor;
    (3) A description of the job opportunity for which certification is 
sought with sufficient information to apprise U.S. workers of the 
services or labor to be performed, including the duties, the minimum 
education and experience requirements, the work hours and days, and the 
anticipated start and end dates of the job opportunity;
    (4) A statement that the job opportunity is a temporary, full-time 
position including the total number of job openings the employer intends 
to fill;
    (5) If applicable, a statement that overtime will be available to 
the worker and the wage offer(s) for working any overtime hours;
    (6) If applicable, a statement indicating that on-the-job training 
will be provided to the worker;
    (7) The wage that the employer is offering, intends to offer or will 
provide to the H-2B workers, or in the event that there are multiple 
wage offers (such as where an itinerary is authorized through special 
procedures for an employer), the range of applicable wage offers, each 
of which must equal or exceed the highest of the prevailing wage or the 
Federal, State, or local minimum wage;
    (8) If applicable, any board, lodging, or other facilities the 
employer will

[[Page 516]]

offer to workers or intends to assist workers in securing;
    (9) All deductions not required by law that the employer will make 
from the worker's paycheck, including, if applicable, reasonable 
deduction for board, lodging, and other facilities offered to the 
workers;
    (10) A statement that transportation and subsistence from the place 
where the worker has come to work for the employer to the place of 
employment and return transportation and subsistence will be provided, 
as required bySec. 655.20(j)(1);
    (11) If applicable, a statement that work tools, supplies, and 
equipment will be provided to the worker without charge;
    (12) If applicable, a statement that daily transportation to and 
from the worksite will be provided by the employer;
    (13) A statement summarizing the three-fourths guarantee as required 
bySec. 655.20(f); and
    (14) A statement directing applicants to apply for the job 
opportunity at the nearest office of the SWA in the State in which the 
advertisement appeared, the SWA contact information, and, if applicable, 
the job order number.

[77 FR 10162, Feb. 21, 2012]

    Effective Date Note: At 77 FR 10162, Feb. 21, 2012,Sec. 655.41 was 
added, effective Apr. 23, 2012.



Sec.  655.42  Newspaper advertisements.

    (a) The employer must place an advertisement (which may be in a 
language other than English, where the CO determines appropriate) on 2 
separate days, which may be consecutive, one of which must be a Sunday 
(except as provided in paragraph (b) of this section), in a newspaper of 
general circulation serving the area of intended employment and 
appropriate to the occupation and the workers likely to apply for the 
job opportunity.
    (b) If the job opportunity is located in a rural area that does not 
have a newspaper with a Sunday edition, the CO may direct the employer, 
in place of a Sunday edition, to advertise in the regularly published 
daily edition with the widest circulation in the area of intended 
employment.
    (c) The newspaper advertisements must satisfy the requirements in 
Sec.  655.41.
    (d) The employer must maintain copies of newspaper pages (with date 
of publication and full copy of the advertisement), or tear sheets of 
the pages of the publication in which the advertisements appeared, or 
other proof of publication furnished by the newspaper containing the 
text of the printed advertisements and the dates of publication, 
consistent with the document retention requirements inSec. 655.56. If 
the advertisement was required to be placed in a language other than 
English, the employer must maintain a translation and retain it in 
accordance withSec. 655.56.

[77 FR 10162, Feb. 21, 2012]

    Effective Date Note: At 77 FR 10162, Feb. 21, 2012,Sec. 655.42 was 
added, effective Apr. 23, 2012.



Sec.  655.43  Contact with former U.S. employees.

    The employer must contact (by mail or other effective means) its 
former U.S. workers, including those who have been laid off within 120 
calendar days before the date of need (except those who were dismissed 
for cause or who abandoned the worksite), employed by the employer in 
the occupation at the place of employment during the previous year, 
disclose the terms of the job order, and solicit their return to the 
job. The employer must maintain documentation sufficient to prove such 
contact in accordance withSec. 655.56.

[77 FR 10162, Feb. 21, 2012]

    Effective Date Note: At 77 FR 10162, Feb. 21, 2012,Sec. 655.43 was 
added, effective Apr. 23, 2012.



Sec.  655.44  [Reserved]

    Effective Date Note: At 77 FR 10162, Feb. 21, 2012,Sec. 655.44 was 
added and reserved, effective Apr. 23, 2012.



Sec.  655.45  Contact with bargaining representative, posting and 
other contact requirements.

    (a) If there is a bargaining representative for any of the 
employer's employees in the occupation and area of intended employment, 
the employer must provide written notice of the job

[[Page 517]]

opportunity, by providing a copy of the Application for Temporary 
Employment Certification and the job order, and maintain documentation 
that it was sent to the bargaining representative(s). An employer 
governed by this paragraph must include information in its recruitment 
report that confirms that the bargaining representative(s) was contacted 
and notified of the position openings and whether the organization 
referred qualified U.S. worker(s), including the number of referrals, or 
was non-responsive to the employer's requests.
    (b) If there is no bargaining representative, the employer must post 
the availability of the job opportunity in at least 2 conspicuous 
locations at the place(s) of anticipated employment or in some other 
manner that provides reasonable notification to all employees in the job 
classification and area in which the work will be performed by the H-2B 
workers. Electronic posting, such as displaying the notice prominently 
on any internal or external Web site that is maintained by the employer 
and customarily used for notices to employees about terms and conditions 
of employment, is sufficient to meet this posting requirement as long as 
it otherwise meets the requirements of this section. The notice must 
meet the requirements underSec. 655.41 and be posted for at least 15 
consecutive business days. The employer must maintain a copy of the 
posted notice and identify where and when it was posted in accordance 
withSec. 655.56.
    (c) If appropriate to the occupation and area of intended 
employment, as indicated by the CO in the Notice of Acceptance, the 
employer must provide written notice of the job opportunity to a 
community-based organization, and maintain documentation that it was 
sent to any designated community-based organization. An employer 
governed by this paragraph must include information in its recruitment 
report that confirms that the community-based organization was contacted 
and notified of the position openings and whether the organization 
referred qualified U.S. worker(s), including the number of referrals, or 
was non-responsive to the employer's requests.

[77 FR 10162, Feb. 21, 2012]

    Effective Date Note: At 77 FR 10162, Feb. 21, 2012,Sec. 655.45 was 
added, effective Apr. 23, 2012.



Sec.  655.46  Additional employer-conducted recruitment.

    (a) Requirement to conduct additional recruitment. The employer may 
be instructed by the CO to conduct additional recruitment. Such 
recruitment may be required at the discretion of the CO where the CO has 
determined that there may be U.S. workers who are qualified and who will 
be available for the work, including but not limited to where the job 
opportunity is located in an Area of Substantial Unemployment.
    (b) Nature of the additional employer-conducted recruitment. The CO 
will describe the precise number and nature of the additional 
recruitment efforts. Additional recruitment may include, but is not 
limited to, posting on the employer's Web site or another Web site, 
contact with additional community-based organizations, additional 
contact with State One-Stop Career Centers, and other print advertising, 
such as using a professional, trade or ethnic publication where such a 
publication is appropriate for the occupation and the workers likely to 
apply for the job opportunity.
    (c) Proof of the additional employer-conducted recruitment. The CO 
will specify the documentation or other supporting evidence that must be 
maintained by the employer as proof that the additional recruitment 
requirements were met. Documentation must be maintained as required in 
Sec.  655.56.

[77 FR 10162, Feb. 21, 2012]

    Effective Date Note: At 77 FR 10162, Feb. 21, 2012,Sec. 655.46 was 
added, effective Apr. 23, 2012.



Sec.  655.47  Referrals of U.S. workers.

    SWAs may only refer for employment individuals who have been 
apprised of all the material terms and conditions of employment and who 
are qualified and will be available for employment.

[77 FR 10162, Feb. 21, 2012]

    Effective Date Note: At 77 FR 10162, Feb. 21, 2012,Sec. 655.47 was 
added, effective Apr. 23, 2012.

[[Page 518]]



Sec.  655.48  Recruitment report.

    (a) Requirements of the recruitment report. The employer must 
prepare, sign, and date a recruitment report. The recruitment report 
must be submitted by a date specified by the CO in the Notice of 
Acceptance and contain the following information:
    (1) The name of each recruitment activity or source (e.g., job order 
and the name of the newspaper);
    (2) The name and contact information of each U.S. worker who applied 
or was referred to the job opportunity up to the date of the preparation 
of the recruitment report, and the disposition of each worker's 
application. The employer must clearly indicate whether the job 
opportunity was offered to the U.S. worker and whether the U.S. worker 
accepted or declined;
    (3) Confirmation that former U.S. employees were contacted, if 
applicable, and by what means;
    (4) Confirmation that the bargaining representative was contacted, 
if applicable, and by what means, or that the employer posted the 
availability of the job opportunity to all employees in the job 
classification and area in which the work will be performed by the H-2B 
workers;
    (5) Confirmation that the community-based organization designated by 
the CO was contacted, if applicable;
    (6) If applicable, confirmation that additional recruitment was 
conducted as directed by the CO; and
    (7) If applicable, for each U.S. worker who applied for the position 
but was not hired, the lawful job-related reason(s) for not hiring the 
U.S. worker.
    (b) Duty to update recruitment report. The employer must continue to 
update the recruitment report throughout the recruitment period. The 
updated report need not be submitted to the Department, but must be made 
available in the event of a post-certification audit or upon request by 
DOL.

[77 FR 10162, Feb. 21, 2012]

    Effective Date Note: At 77 FR 10162, Feb. 21, 2012,Sec. 655.48 was 
added, effective Apr. 23, 2012.



Sec.  655.49  [Reserved]

    Effective Date Note: At 77 FR 10162, Feb. 21, 2012,Sec. 655.49 was 
added and reserved, effective Apr. 23, 2012.

                   Labor Certification Determinations

    Effective Date Note: At 77 FR 10163, Feb. 21, 2012, an undesignated 
center heading was added beforeSec. 655.50, effective Apr. 23, 2012.



Sec.  655.50  Enforcement process.

    (a) Authority of the WHD Administrator. The WHD Administrator shall 
perform all the Secretary's investigative and enforcement functions 
under secs. 1101(a)(15)(H)(ii)(b), 103(a)(6), and 214(c) of the INA, 
pursuant to the delegation of authority from the Secretary of Homeland 
Security to the Secretary of Labor.
    (b) Conduct of investigations. The Administrator, WHD, shall, either 
pursuant to a complaint or otherwise, conduct such investigations as 
may, in the judgment of the Administrator, be appropriate, and in 
connection therewith, may enter and inspect such places and such records 
(and make transcriptions or copies thereof), question such persons, and 
gather such information as deemed necessary by the Administrator to 
determine compliance regarding the matters which are the subject of 
investigation.
    (c) Employer cooperation/availability of records. An employer shall 
at all times cooperate in administrative and enforcement proceedings. An 
employer being investigated shall make available to the WHD 
Administrator such records, information, persons, and places as the 
Administrator deems appropriate to copy, transcribe, question, or 
inspect. Where the records are maintained at a central recordkeeping 
office, other than in the place or places of employment, such records 
must be made available for inspection and copying within 72 hours 
following notice from the Secretary, or a duly authorized and designated 
representative. No employer or representative or agent of an employer 
subject to the provisions of secs. 1101(a)(15)(H)(ii)(b) and 214(c) of 
the INA and/or of this subpart shall interfere with any official of the

[[Page 519]]

Department who is performing an investigation, inspection, or law 
enforcement function pursuant to 8 U.S.C. 1101(a)(15)(H)(ii)(b) or 
1184(c). Any such interference shall be a violation of the labor 
certification application and of this subpart, and the Administrator may 
take such further actions as the Administrator considers appropriate. 
(Federal criminal statutes prohibit certain interference with a Federal 
officer in the performance of official duties. 18 U.S.C. 111 and 18 
U.S.C. 1114.)
    (d) Confidentiality. The WHD Administrator shall, to the extent 
possible under existing law, protect the confidentiality of any person 
who provides information to the Department in confidence in the course 
of an investigation or otherwise under this subpart.

    Effective Date Note: At 77 FR 10163, Feb. 21, 2012,Sec. 655.50 was 
revised, effective Apr. 23, 2012. For the convenience of the user, the 
revised text is set forth as follows:



Sec.  655.50  Determinations.

    (a) Certifying Officers (COs). The Administrator, OFLC is the 
Department's National CO. The Administrator, OFLC and the CO(s), by 
virtue of delegation from the Administrator, OFLC, have the authority to 
certify or deny Applications for Temporary Employment Certification 
under the H-2B nonimmigrant classification. If the Administrator, OFLC 
directs that certain types of temporary labor certification applications 
or a specific Application for Temporary Employment Certification under 
the H-2B nonimmigrant classification be handled by the OFLC's National 
Office, the Director of the NPC will refer such applications to the 
Administrator, OFLC.
    (b) Determination. Except as otherwise provided in this paragraph, 
the CO will make a determination either to certify or deny the 
Application for Temporary Employment Certification. The CO will certify 
the application only if the employer has met all the requirements of 
this subpart, including the criteria for certification inSec. 655.51, 
thus demonstrating that there is an insufficient number of U.S. workers 
who are qualified and who will be available for the job opportunity for 
which certification is sought and that the employment of the H-2B 
workers will not adversely affect the benefits, wages, and working 
conditions of similarly employed U.S. workers.



Sec.  655.51  Criteria for certification.

    (a) The criteria for certification include whether the employer has 
a valid H-2B Registration to participate in the H-2B program and has 
complied with all of the requirements necessary to grant the labor 
certification.
    (b) In making a determination whether there are insufficient U.S. 
workers to fill the employer's job opportunity, the CO will count as 
available any U.S. worker referred by the SWA or any U.S. worker who 
applied (or on whose behalf an application is made) directly to the 
employer, but who was rejected by the employer for other than a lawful 
job-related reason.
    (c) A certification will not be granted to an employer that has 
failed to comply with one or more sanctions or remedies imposed by final 
agency actions under the H-2B program.

[77 FR 10164, Feb. 21, 2012]

    Effective Date Note: At 77 FR 10164, Feb. 21, 2012,Sec. 655.51 was 
added, effective Apr. 23, 2012.



Sec.  655.52  Approved certification.

    If a temporary labor certification is granted, the CO will send the 
approved Application for Temporary Employment Certification and a Final 
Determination letter to the employer by means normally assuring next day 
delivery, including electronic mail, and a copy, if applicable, to the 
employer's attorney or agent. If and when the Application for Temporary 
Employment Certification will be permitted to be electronically filed, 
the employer must sign the certified Application for Temporary 
Employment Certification as directed by the CO. The employer must retain 
a signed copy of the Application for Temporary Employment Certification, 
as required bySec. 655.56.

[77 FR 10164, Feb. 21, 2012]

    Effective Date Note: At 77 FR 10164, Feb. 21, 2012,Sec. 655.52 was 
added, effective Apr. 23, 2012.



Sec.  655.53  Denied certification.

    If a temporary labor certification is denied, the CO will send the 
Final Determination letter to the employer by means normally assuring 
next day delivery, including electronic mail, and a copy, if applicable, 
to the employer's attorney or agent. The Final Determination letter 
will:

[[Page 520]]

    (a) State the reason(s) certification is denied, citing the relevant 
regulatory standards and/or special procedures;
    (b) Offer the employer an opportunity to request administrative 
review of the denial underSec. 655.61; and
    (c) State that if the employer does not request administrative 
review in accordance withSec. 655.61, the denial is final and the 
Department will not accept any appeal on that Application for Temporary 
Employment Certification.

[77 FR 10164, Feb. 21, 2012]

    Effective Date Note: At 77 FR 10164, Feb. 21, 2012,Sec. 655.53 was 
added, effective Apr. 23, 2012.



Sec.  655.54  Partial certification.

    The CO may issue a partial certification, reducing either the period 
of need or the number of H-2B workers or both for certification, based 
upon information the CO receives during the course of processing the 
Application for Temporary Employment Certification. The number of 
workers certified will be reduced by one for each referred U.S. worker 
who is qualified and who will be available at the time and place needed 
to perform the services or labor and who has not been rejected for 
lawful job-related reasons. If a partial labor certification is issued, 
the CO will amend the Application for Temporary Employment Certification 
and then return it to the employer with a Final Determination letter, 
with a copy to the employer's attorney or agent, if applicable. The 
Final Determination letter will:
    (a) State the reason(s) why either the period of need and/or the 
number of H-2B workers requested has been reduced, citing the relevant 
regulatory standards and/or special procedures;
    (b) If applicable, address the availability of U.S. workers in the 
occupation;
    (c) Offer the employer an opportunity to request administrative 
review of the partial certification underSec. 655.61; and
    (d) State that if the employer does not request administrative 
review in accordance withSec. 655.61, the partial certification is 
final and the Department will not accept any appeal on that Application 
for Temporary Employment Certification.

[77 FR 10164, Feb. 21, 2012]

    Effective Date Note: At 77 FR 10164, Feb. 21, 2012,Sec. 655.54 was 
added, effective Apr. 23, 2012.



Sec.  655.55  Validity of temporary labor certification.

    (a) Validity period. A temporary labor certification is valid only 
for the period as approved on the Application for Temporary Employment 
Certification. The certification expires on the last day of authorized 
employment.
    (b) Scope of validity. A temporary labor certification is valid only 
for the number of H-2B positions, the area of intended employment, the 
job classification and specific services or labor to be performed, and 
the employer specified on the approved Application for Temporary 
Employment Certification, including any approved modifications. The 
temporary labor certification may not be transferred from one employer 
to another unless the employer to which it is transferred is a successor 
in interest to the employer to which it was issued.

[77 FR 10164, Feb. 21, 2012]

    Effective Date Note: At 77 FR 10164, Feb. 21, 2012,Sec. 655.55 was 
added, effective Apr. 23, 2012.



Sec.  655.56  Document retention requirements of H-2B employers.

    (a) Entities required to retain documents. All employers filing an 
Application for Temporary Employment Certification requesting H-2B 
workers are required to retain the documents and records proving 
compliance with 29 CFR part 503 and this subpart, including but not 
limited to those specified in paragraph (c) of this section.
    (b) Period of required retention. The employer must retain records 
and documents for 3 years from the date of certification of the 
Application for Temporary Employment Certification, or from the date of 
adjudication if the Application for Temporary Employment Certification 
is denied, or 3 years from the day the Department receives the letter of 
withdrawal provided in accordance withSec. 655.62. For the purposes of 
this

[[Page 521]]

section, records and documents required to be retained in connection 
with an H-2B Registration must be retained in connection with all of the 
Applications for Temporary Employment Certification that are supported 
by it.
    (c) Documents and records to be retained by all employer applicants. 
All employers filing an H-2B Registration and an Application for 
Temporary Employment Certification must retain the following documents 
and records and must provide the documents and records to the Department 
and other Federal agencies in the event of an audit or investigation:
    (1) Documents and records not previously submitted during the 
registration process that substantiate temporary need;
    (2) Proof of recruitment efforts, as applicable, including:
    (i) Job order placement as specified inSec. 655.16;
    (ii) Advertising as specified in Sec.Sec. 655.41 and 655.42;
    (iii) Contact with former U.S. workers as specified inSec. 655.43;
    (iv) Contact with bargaining representative(s), or a copy of the 
posting of the job opportunity, if applicable, as specified inSec. 
655.45(a) or (b); and
    (v) Additional employer-conducted recruitment efforts as specified 
inSec. 655.46;
    (3) Substantiation of the information submitted in the recruitment 
report prepared in accordance withSec. 655.48, such as evidence of 
nonapplicability of contact with former workers as specified inSec. 
655.43;
    (4) The final recruitment report and any supporting resumes and 
contact information as specified inSec. 655.48;
    (5) Records of each worker's earnings, hours offered and worked, 
location(s) of work performed, and other information as specified in 
Sec.  655.20(i);
    (6) If appropriate, records of reimbursement of transportation and 
subsistence costs incurred by the workers, as specified inSec. 
655.20(j).
    (7) Evidence of contact with U.S. workers who applied for the job 
opportunity in the Application for Temporary Employment Certification, 
including documents demonstrating that any rejections of U.S. workers 
were for lawful, job-related reasons, as specified inSec. 655.20(r);
    (8) Evidence of contact with any former U.S. worker in the 
occupation at the place of employment in the Application for Temporary 
Employment Certification, including documents demonstrating that the 
U.S. worker had been offered the job opportunity in the Application for 
Temporary Employment Certification, as specified inSec. 655.20(w), and 
that the U.S. worker either refused the job opportunity or was rejected 
only for lawful, job-related reasons, as specified inSec. 655.20(r);
    (9) The written contracts with agents or recruiters as specified in 
Sec.Sec. 655.8 and 655.9, and the list of the identities and locations 
of persons hired by or working for the agent or recruiter and these 
entities' agents or employees, as specified inSec. 655.9;
    (10) Written notice provided to and informing OFLC that an H-2B 
worker or worker in corresponding employment has separated from 
employment before the end date of employment specified in the 
Application for Temporary Employment Certification, as specified in 
Sec.  655.20(y);
    (11) The H-2B Registration, job order and a copy of the Application 
for Temporary Employment Certification. If and when the Application for 
Temporary Employment Certification and H-2B Registration is permitted to 
be electronically filed, a printed copy of each adjudicated Application 
for Temporary Employment Certification, including any modifications, 
amendments or extensions will be signed by the employer as directed by 
the CO and retained;
    (12) The H-2B Petition, including all accompanying documents; and
    (13) Any collective bargaining agreement(s), individual employment 
contract(s), or payroll records from the previous year necessary to 
substantiate any claim that certain incumbent workers are not included 
in corresponding employment, as specified inSec. 655.5.
    (d) Availability of documents for enforcement purposes. An employer 
must make available to the Administrator, WHD within 72 hours following 
a request by the WHD the documents and records required under 29 CFR 
part 503

[[Page 522]]

and this section so that the Administrator, WHD may copy, transcribe, or 
inspect them.

[77 FR 10164, Feb. 21, 2012]

    Effective Date Note: At 77 FR 10164, Feb. 21, 2012,Sec. 655.56 was 
added, effective Apr. 23, 2012.



Sec.  655.57  Request for determination based on nonavailability of
U.S. workers.

    (a) Standards for requests. If a temporary labor certification has 
been partially granted or denied, based on the CO's determination that 
qualified U.S. workers are available, and, on or after 21 calendar days 
before the date of need, some or all of those qualified U.S. workers 
are, in fact no longer available, the employer may request a new 
temporary labor certification determination from the CO. Prior to making 
a new determination the CO will promptly ascertain (which may be through 
the SWA or other sources of information on U.S. worker availability) 
whether specific qualified replacement U.S. workers are available or can 
be reasonably expected to be present at the employer's establishment 
with 72 hours from the date the employer's request was received. The CO 
will expeditiously, but in no case later than 72 hours after the time a 
complete request (including the signed statement included in paragraph 
(b) of this section) is received, make a determination on the request. 
An employer may appeal a denial of such a determination in accordance 
with procedures contained inSec. 655.61.
    (b) Unavailability of U.S. workers. The employer's request for a new 
determination must be made directly to the CO by electronic mail or 
other appropriate means and must be accompanied by a signed statement 
confirming the employer's assertion. In addition, unless the employer 
has provided to the CO notification of abandonment or termination of 
employment as required bySec. 655.20(y), the employer's signed 
statement must include the name and contact information of each U.S. 
worker who became unavailable and must supply the reason why the worker 
has become unavailable.
    (c) Notification of determination. If the CO determines that U.S. 
workers have become unavailable and cannot identify sufficient available 
U.S. workers who are qualified or who are likely to become available, 
the CO will grant the employer's request for a new determination. 
However, this does not preclude an employer from submitting subsequent 
requests for new determinations, if warranted, based on subsequent facts 
concerning purported nonavailability of U.S. workers or referred workers 
not being qualified because of lawful job-related reasons.

[77 FR 10164, Feb. 21, 2012]

    Effective Date Note: At 77 FR 10164, Feb. 21, 2012,Sec. 655.57 was 
added, effective Apr. 23, 2012.



Sec.Sec. 655.58-655.59  [Reserved]

    Effective Date Note: At 77 FR 10165, Feb. 21, 2012, Sec.Sec. 
655.58 through 655.59 were added and reserved, effective Apr. 23, 2012.

                      Post Certification Activities

    Effective Date Note: At 77 FR 10165, Feb. 21, 2012, an undesignated 
center heading was added beforeSec. 655.60, effective Apr. 23, 2012.



Sec.  655.60  Violations.

    The WHD Administrator, through investigation, shall determine 
whether an employer has--
    (a) Filed a petition with ETA that willfully misrepresents a 
material fact.
    (b) Substantially failed to meet any of the conditions of the labor 
certification application attested to, as listed inSec. 655.22, or any 
of the conditions of the DHS Form I-129, Petition for a Nonimmigrant 
Worker for an H-2B worker in 8 CFR 214.2(h).
    (c) Misrepresented a material fact to the State Department during 
the visa application process.

    Effective Date Note: At 77 FR 10165, Feb. 21, 2012,Sec. 655.60 was 
revised, effective Apr. 23, 2012. For the convenience of the user, the 
revised text is set forth as follows:



Sec.  655.60  Extensions.

    An employer may apply for extensions of the period of employment in 
the following circumstances. A request for extension must be related to 
weather conditions or other factors beyond the control of the employer 
(which may include unforeseeable changes in market conditions), and must 
be supported in writing, with documentation showing why the extension is 
needed and that the need

[[Page 523]]

could not have been reasonably foreseen by the employer. The CO will 
notify the employer of the decision in writing. The CO will not grant an 
extension where the total work period under that Application for 
Temporary Employment Certification and the authorized extension would 
exceed 9 months for employers whose temporary need is seasonal, 
peakload, or intermittent, or 3 years for employers that have a one-time 
occurrence of temporary need, except in extraordinary circumstances. The 
employer may appeal a denial of a request for an extension by following 
the procedures inSec. 655.61. The H-2B employer's assurances and 
obligations under the temporary labor certification will continue to 
apply during the extended period of employment. The employer must 
immediately provide to its workers a copy of any approved extension.



Sec.  655.61  Administrative review.

    (a) Request for review. Where authorized in this subpart, employers 
may request an administrative review before the BALCA of a determination 
by the CO. In such cases, the request for review:
    (1) Must be sent to the BALCA, with a copy simultaneously sent to 
the CO who denied the application, within 10 business days from the date 
of determination;
    (2) Must clearly identify the particular determination for which 
review is sought;
    (3) Must set forth the particular grounds for the request;
    (4) Must include a copy of the CO's determination; and
    (5) May contain only legal argument and such evidence as was 
actually submitted to the CO before the date the CO's determination was 
issued.
    (b) Appeal file. Upon the receipt of a request for review, the CO 
will, within 7 business days, assemble and submit the Appeal File using 
means to ensure same day or next day delivery, to the BALCA, the 
employer, and the Associate Solicitor for Employment and Training Legal 
Services, Office of the Solicitor, U.S. Department of Labor.
    (c) Briefing schedule. Within 7 business days of receipt of the 
Appeal File, the counsel for the CO may submit, using means to ensure 
same day or next day delivery, a brief in support of the CO's decision.
    (d) Assignment. The Chief ALJ may designate a single member or a 
three member panel of the BALCA to consider a particular case.
    (e) Review. The BALCA must review the CO's determination only on the 
basis of the Appeal File, the request for review, and any legal briefs 
submitted and must:
    (1) Affirm the CO's determination; or
    (2) Reverse or modify the CO's determination; or
    (3) Remand to the CO for further action.
    (f) Decision. The BALCA should notify the employer, the CO, and 
counsel for the CO of its decision within 7 business days of the 
submission of the CO's brief or 10 business days after receipt of the 
Appeal File, whichever is later, using means to ensure same day or next 
day delivery.

[77 FR 10166, Feb. 21, 2012]

    Effective Date Note: At 77 FR 10166, Feb. 21, 2012,Sec. 655.61 was 
added, effective Apr. 23, 2012.



Sec.  655.62  Withdrawal of an Application for Temporary Employment
Certification.

    Employers may withdraw an Application for Temporary Employment 
Certification after it has been accepted and before it is adjudicated. 
The employer must request such withdrawal in writing.

[77 FR 10166, Feb. 21, 2012]

    Effective Date Note: At 77 FR 10166, Feb. 21, 2012,Sec. 655.62 was 
added, effective Apr. 23, 2012.



Sec.  655.63  Public disclosure.

    The Department will maintain an electronic file accessible to the 
public with information on all employers applying for temporary 
nonagricultural labor certifications. The database will include such 
information as the number of workers requested, the date filed, the date 
decided, and the final disposition.

[77 FR 10166, Feb. 21, 2012]

    Effective Date Note: At 77 FR 10166, Feb. 21, 2012,Sec. 655.63 was 
added, effective Apr. 23, 2012.

[[Page 524]]



Sec.  655.64  [Reserved]

    Effective Date Note: At 77 FR 10166, Feb. 21, 2012,Sec. 655.64 was 
added and reserved, effective Apr. 23, 2012.



Sec.  655.65  Remedies for violations.

    (a) Upon determining that an employer has willfully failed to pay 
wages, in violation of the attestation required bySec. 655.22(e) or 
willfully required employees to pay for fees or expenses prohibited by 
Sec.  655.22(j), or willfully made impermissible deductions from pay as 
provided inSec. 655.22(g), the WHD Administrator may assess civil 
money penalties that are equal to the difference between the amount that 
should have been paid and the amount that actually was paid to such 
nonimmigrant(s), not to exceed $10,000.
    (b) Upon determining that an employer has terminated by layoff or 
otherwise any employee described inSec. 622.55(k) of this part, within 
the period described in that section, the Administrator may assess civil 
money penalties that are equal to the wages that would have been earned 
but for the layoff at the H-2B rate for that period, not to exceed 
$10,000. No civil money penalty shall be assessed, however, if the 
employee refused the job opportunity, or was terminated for lawful, job-
related reasons.
    (c) The Administrator may assess civil money penalties in an amount 
not to exceed $10,000 per violation for any substantial failure to meet 
the conditions provided in the H-2B Application for Temporary Employment 
Certification or the DHS Form I-129, Petition for a Nonimmigrant Worker 
for an H-2B worker or successor form, or any willful misrepresentation 
in the application or petition, or a failure to cooperate with a 
Department audit or investigation.
    (d) Substantial failure in paragraph (b) of this section shall mean 
a willful failure that constitutes a significant deviation from the 
terms and conditions of the labor condition application or the DHS Form 
I-129, Petition for a Nonimmigrant Worker for an H-2B worker or 
successor form.
    (e) For purposes of this subpart, ``willful failure'' means a 
knowing failure or a reckless disregard with respect to whether the 
conduct was contrary to sec. 214(c) of the INA, or this subpart. See 
McLaughlin v. Richland Shoe Co., 486 U.S. 128 (1988); see also Trans 
World Airlines v. Thurston, 469 U.S. 111 (1985).
    (f) The provisions of this subpart become applicable upon the date 
that the employer's labor condition application is certified and/or upon 
the date employment commences, whichever is earlier. The employer's 
submission and signature on the labor certification application and DHS 
Form I-129, Petition for a Nonimmigrant Worker for an H-2B worker or 
successor form constitutes the employer's representation that the 
statements on the application are accurate and its acknowledgment and 
acceptance of the obligations of the program. The employer's acceptance 
of these obligations is re-affirmed by the employer's submission of the 
petition (Form I-129), supported by the labor certification.
    (g) In determining the amount of the civil money penalty to be 
assessed pursuant to paragraphs (b) and (c) of this section, the WHD 
Administrator shall consider the type of violation committed and other 
relevant factors. In determining the level of penalties to be assessed, 
the highest penalties shall be reserved for willful failures to meet any 
of the conditions of the application that involve harm to U.S. workers. 
Other factors which may be considered include, but are not limited to, 
the following:
    (1) Previous history of violation, or violations, by the employer 
under the INA and this subpart, and 8 CFR 214.2;
    (2) The number of U.S. or H-2B workers employed by the employer and 
affected by the violation or violations;
    (3) The gravity of the violation or violations;
    (4) Efforts made by the employer in good faith to comply with the 
INA and regulatory provisions of this subpart and at 8 CFR 214.2(h);
    (5) The employer's explanation of the violation or violations;
    (6) The employer's commitment to future compliance; and
    (7) The extent to which the employer achieved a financial gain due 
to the violation, or the potential financial loss to the employer's 
workers.

[[Page 525]]

    (h) Disqualification from approval of petitions. Where the WHD 
Administrator finds a substantial failure to meet any conditions of the 
application or in a DHS Form I-129, or a willful misrepresentation of a 
material fact in an application or in a DHS Form I-129, as those terms 
are defined inSec. 655.31, the Administrator may recommend that ETA 
debar the employer for a period of no less than 1 year, and no more than 
3 years.
    (i) If the WHD Administrator finds a violation of the provisions 
specified in this subpart, the Administrator may impose such other 
administrative remedies as the Administrator determines to be 
appropriate, including reinstatement of displaced U.S. workers, or other 
appropriate legal or equitable remedies. If the WHD Administrator finds 
that an employer has not paid wages at the wage level specified under 
the application and required bySec. 655.22(e), the Administrator may 
require the employer to provide for payment of such amounts of back pay 
as may be required to comply with the requirements ofSec. 655.22(e).
    (j) The civil money penalties determined by the WHD Administrator to 
be appropriate are due for payment within 30 days of the assessment by 
the Administrator, or upon the decision by an administrative law judge 
where a hearing is timely requested, or upon the decision by the 
Secretary where review is granted. The employer shall remit the amount 
of the civil money penalty by certified check or money order made 
payable to the order of ``Wage and Hour Division, Labor.'' The 
remittance shall be delivered or mailed to the Wage and Hour Division 
office in the manner directed in the Administrator's notice of 
determination. The payment or performance of any other remedy prescribed 
by the Administrator shall follow procedures established by the 
Administrator.
    (k) The Federal Civil Penalties Inflation Adjustment Act of 1990, as 
amended (28 U.S.C. 2461 note), requires that inflationary adjustments to 
civil money penalties in accordance with a specified cost-of-living 
formula be made, by regulation, at least every 4 years. The adjustments 
are to be based on changes in the Consumer Price Index for all Urban 
Consumers (CPI-U) for the U.S. City Average for All Items. The adjusted 
amounts will be published in the Federal Register. The amount of the 
penalty in a particular case will be based on the amount of the penalty 
in effect at the time the violation occurs.

    Effective Date Note: At 77 FR 10166, Feb. 21, 2012,Sec. 655.65 was 
removed and reserved, effective Apr. 23, 2012.



Sec.Sec. 655.66-655.69  [Reserved]

    Effective Date Note: At 77 FR 10166, Feb. 21, 2012, Sec.Sec. 
655.66 through 655.69 were added and reserved, effective Apr. 23, 2012.

                           Integrity Measures

    Effective Date Note: At 77 FR 10166, Feb. 21, 2012, an undesignated 
center heading was added beforeSec. 655.70, effective Apr. 23, 2012.



Sec.  655.70  WHD Administrator's determination.

    (a) The WHD Administrator's determination shall be served on the 
employer by personal service or by certified mail at the employer's last 
known address. Where service by certified mail is not accepted by the 
employer, the Administrator may exercise discretion to serve the 
determination by regular mail.
    (b) The WHD Administrator shall file with the Chief Administrative 
Law Judge, U.S. Department of Labor, a copy of the Administrator's 
determination.
    (c) The WHD Administrator's written determination shall:
    (1) Set forth the determination of the Administrator and the reason 
or reasons therefore, and in the case of a finding of violation(s) by an 
employer, prescribe the amount of any back wages and civil money 
penalties assessed and the reason therefor.
    (2) Inform the employer that a hearing may be requested pursuant to 
Sec.  655.71.
    (3) Inform the employer that in the absence of a timely request for 
a hearing, received by the Chief Administrative Law Judge within 15 
calendar days of the date of the determination, the determination of the 
Administrator shall become final and not appealable.

[[Page 526]]

    (4) Set forth the procedure for requesting a hearing, give the 
addresses of the Chief Administrative Law Judge (with whom the request 
must be filed) and the representative(s) of the Solicitor of Labor (upon 
whom copies of the request must be served).
    (5) Where appropriate, inform the employer that the Administrator 
will notify ETA and DHS of the occurrence of a violation by the 
employer.

    Effective Date Note: At 77 FR 10166, Feb. 21, 2012,Sec. 655.70 was 
revised, effective Apr. 23, 2012. For the convenience of the user, the 
revised text is set forth as follows:



Sec.  655.70  Audits.

    The CO may conduct audits of adjudicated temporary labor 
certification applications.
    (a) Discretion. The CO has the sole discretion to choose the 
applications selected for audit.
    (b) Audit letter. Where an application is selected for audit, the CO 
will send an audit letter to the employer and a copy, if appropriate, to 
the employer's attorney or agent. The audit letter will:
    (1) Specify the documentation that must be submitted by the 
employer;
    (2) Specify a date, no more than 30 calendar days from the date the 
audit letter is issued, by which the required documentation must be sent 
to the CO; and
    (3) Advise that failure to fully comply with the audit process may 
result:
    (i) In the requirement that the employer undergo the assisted 
recruitment procedures inSec. 655.71 in future filings of H-2B 
temporary labor certification applications for a period of up to 2 
years, or
    (ii) In a revocation of the certification and/or debarment from the 
H-2B program and any other foreign labor certification program 
administered by the Department.
    (c) Supplemental information request. During the course of the audit 
examination, the CO may request supplemental information and/or 
documentation from the employer in order to complete the audit. If 
circumstances warrant, the CO can issue one or more requests for 
supplemental information.
    (d) Potential referrals. In addition to measures in this subpart, 
the CO may decide to provide the audit findings and underlying 
documentation to DHS, WHD, or other appropriate enforcement agencies. 
The CO may refer any findings that an employer discouraged a qualified 
U.S. worker from applying, or failed to hire, discharged, or otherwise 
discriminated against a qualified U.S. worker, to the Department of 
Justice, Civil Rights Division, Office of Special Counsel for Unfair 
Immigration Related Employment Practices.



Sec.  655.71  Request for hearing.

    (a) An employer desiring review of a determination issued under 
Sec.  655.70, including judicial review, shall make a request for such 
an administrative hearing in writing to the Chief Administrative Law 
Judge at the address stated in the notice of determination. In such a 
proceeding, the Administrator shall be the prosecuting party, and the 
employer shall be the respondent. If such a request for an 
administrative hearing is timely filed, the WHD Administrator's 
determination shall be inoperative unless and until the case is 
dismissed or the Administrative Law Judge issues an order affirming the 
decision.
    (b) No particular form is prescribed for any request for hearing 
permitted by this section. However, any such request shall:
    (1) Be dated;
    (2) Be typewritten or legibly written;
    (3) Specify the issue or issues stated in the notice of 
determination giving rise to such request;
    (4) State the specific reason or reasons why the employer believes 
such determination is in error;
    (5) Be signed by the employer making the request or by an authorized 
representative of such employer; and
    (6) Include the address at which such employer or authorized 
representative desires to receive further communications relating 
thereto.
    (c) The request for such hearing must be received by the Chief 
Administrative Law Judge, at the address stated in the WHD 
Administrator's notice of determination, no later than 15 calendar days 
after the date of the determination. An employer which fails to meet 
this 15-day deadline for requesting a hearing may thereafter participate 
in the proceedings only by consent of the administrative law judge.
    (d) The request may be filed in person, by facsimile transmission, 
by certified or regular mail, or by courier service. For the requesting 
employer's protection, if the request is by mail, it should be by 
certified mail. If the request is by facsimile transmission, the 
original of the request, signed by the employer or authorized 
representative, shall be filed within 10 days.

[[Page 527]]

    (e) Copies of the request for a hearing shall be sent by the 
employer or authorized representative to the WHD official who issued the 
WHD Administrator's notice of determination, and to the 
representative(s) of the Solicitor of Labor identified in the notice of 
determination.

    Effective Date Note: At 77 FR 10166, Feb. 21, 2012,Sec. 655.71 was 
revised, effective Apr. 23, 2012. For the convenience of the user, the 
revised text is set forth as follows:



Sec.  655.71  CO-ordered assisted recruitment.

    (a) Requirement of assisted recruitment. If, as a result of audit or 
otherwise, the CO determines that a violation has occurred that does not 
warrant debarment, the CO may require the employer to engage in assisted 
recruitment for a defined period of time for any future Application for 
Temporary Employment Certification.
    (b) Notification of assisted recruitment. The CO will notify the 
employer (and its attorney or agent, if applicable) in writing of the 
assisted recruitment that will be required of the employer for a period 
of up to 2 years from the date the notice is issued. The notification 
will state the reasons for the imposition of the additional 
requirements, state that the employer's agreement to accept the 
conditions will constitute their inclusion as bona fide conditions and 
terms of a temporary labor certification, and offer the employer an 
opportunity to request an administrative review. If administrative 
review is requested, the procedures inSec. 655.61 apply.
    (c) Assisted recruitment. The assisted recruitment process will be 
in addition to any recruitment required of the employer by Sec.Sec. 
655.41 through 655.47 and may consist of, but is not limited to, one or 
more of the following:
    (1) Requiring the employer to submit a draft advertisement to the CO 
for review and approval at the time of filing the Application for 
Temporary Employment Certification;
    (2) Designating the sources where the employer must recruit for U.S. 
workers, including newspapers and other publications, and directing the 
employer to place the advertisement(s) in such sources;
    (3) Extending the length of the placement of the advertisement and/
or job order;
    (4) Requiring the employer to notify the CO and the SWA in writing 
when the advertisement(s) are placed;
    (5) Requiring an employer to perform any additional assisted 
recruitment directed by the CO;
    (6) Requiring the employer to provide proof of the publication of 
all advertisements as directed by the CO, in addition to providing a 
copy of the job order;
    (7) Requiring the employer to provide proof of all SWA referrals 
made in response to the job order;
    (8) Requiring the employer to submit any proof of contact with all 
referrals and past U.S. workers; and/or
    (9) Requiring the employer to provide any additional documentation 
verifying it conducted the assisted recruitment as directed by the CO.
    (d) Failure to comply. If an employer materially fails to comply 
with requirements ordered by the CO under this section, the 
certification will be denied and the employer and/or its attorney or 
agent may be debarred underSec. 655.73.



Sec.  655.72  Hearing rules of practice.

    (a) Except as specifically provided in this subpart, and to the 
extent they do not conflict with the provisions of this subpart, the 
``Rules of Practice and Procedure for Administrative Hearings Before the 
Office of Administrative Law Judges'' established by the Secretary at 29 
CFR part 18 shall apply to administrative proceedings under this 
subpart.
    (b) As provided in the Administrative Procedure Act, 5 U.S.C. 556, 
any oral or documentary evidence may be received in proceedings under 
this part. The Federal Rules of Evidence and subpart B of the Rules of 
Practice and Procedure for Administrative Hearings Before the Office of 
Administrative Law Judges (29 CFR part 18, subpart B) shall not apply, 
but principles designed to ensure production of relevant and probative 
evidence shall guide the admission of evidence. The administrative law 
judge may exclude evidence which is immaterial, irrelevant, or unduly 
repetitive.

    Effective Date Note: At 77 FR 10166, Feb. 21, 2012,Sec. 655.72 was 
revised, effective Apr. 23, 2012. For the convenience of the user, the 
revised text is set forth as follows:



Sec.  655.72  Revocation.

    (a) Basis for DOL revocation. The Administrator, OFLC may revoke a 
temporary labor certification approved under this subpart, if the 
Administrator, OFLC finds:
    (1) The issuance of the temporary labor certification was not 
justified due to fraud or willful misrepresentation of a material fact 
in the application process, as defined inSec. 655.73(d);
    (2) The employer substantially failed to comply with any of the 
terms or conditions

[[Page 528]]

of the approved temporary labor certification. A substantial failure is 
a willful failure to comply that constitutes a significant deviation 
from the terms and conditions of the approved certification and is 
further defined inSec. 655.73(d) and (e);
    (3) The employer failed to cooperate with a DOL investigation or 
with a DOL official performing an investigation, inspection, audit 
(underSec. 655.73), or law enforcement function under 29 CFR part 503 
or this subpart; or
    (4) The employer failed to comply with one or more sanctions or 
remedies imposed by WHD, or with one or more decisions or orders of the 
Secretary with the respect to the H-2B program.
    (b) DOL procedures for revocation. (1) Notice of Revocation. If the 
Administrator, OFLC makes a determination to revoke an employer's 
temporary labor certification, the Administrator, OFLC will send to the 
employer (and its attorney or agent, if applicable) a Notice of 
Revocation. The notice will contain a detailed statement of the grounds 
for the revocation and inform the employer of its right to submit 
rebuttal evidence or to appeal. If the employer does not file rebuttal 
evidence or an appeal within 10 business days from the date the Notice 
of Revocation is issued, the notice is the final agency action and will 
take effect immediately at the end of the 10-day period.
    (2) Rebuttal. If the employer timely submits rebuttal evidence, the 
Administrator, OFLC will inform the employer of the final determination 
on the revocation within 10 business days of receiving the rebuttal 
evidence. If the Administrator, OFLC determines that the certification 
should be revoked, the Administrator, OFLC will inform the employer of 
its right to appeal according to the procedures ofSec. 655.61. If the 
employer does not appeal the final determination, it will become the 
final agency action.
    (3) Appeal. An employer may appeal a Notice of Revocation, or a 
final determination of the Administrator, OFLC after the review of 
rebuttal evidence, according to the appeal procedures ofSec. 655.61. 
The ALJ's decision is the final agency action.
    (4) Stay. The timely filing of rebuttal evidence or an 
administrative appeal will stay the revocation pending the outcome of 
those proceedings.
    (5) Decision. If the temporary labor certification is revoked, the 
Administrator, OFLC will send a copy of the final agency action to DHS 
and the Department of State.
    (c) Employer's obligations in the event of revocation. If an 
employer's temporary labor certification is revoked, the employer is 
responsible for:
    (1) Reimbursement of actual inbound transportation and other 
expenses;
    (2) The workers' outbound transportation expenses;
    (3) Payment to the workers of the amount due under the three-fourths 
guarantee; and
    (4) Any other wages, benefits, and working conditions due or owing 
to the workers under this subpart.



Sec.  655.73  Service of pleadings.

    (a) Under this subpart, a party may serve any pleading or document 
by regular mail. Service on a party is complete upon mailing to the last 
known address. No additional time for filing or response is authorized 
where service is by mail. In the interest of expeditious proceedings, 
the administrative law judge may direct the parties to serve pleadings 
or documents by a method other than regular mail.
    (b) Two copies of all pleadings and other documents in any 
administrative law judge proceeding shall be served on the attorneys for 
the WHD Administrator. One copy shall be served on the Associate 
Solicitor, Division of Fair Labor Standards, Office of the Solicitor, 
U.S. Department of Labor, 200 Constitution Avenue, NW., Room N-2716, 
Washington, DC 20210, and one copy shall be served on the attorney 
representing the Administrator in the proceeding.
    (c) Time will be computed beginning with the day following service 
and includes the last day of the period unless it is a Saturday, Sunday, 
or Federally-observed holiday, in which case the time period includes 
the next business day.

    Effective Date Note: At 77 FR 10166, Feb. 21, 2012,Sec. 655.73 was 
revised, effective Apr. 23, 2012. For the convenience of the user, the 
revised text is set forth as follows:



Sec.  655.73  Debarment.

    (a) Debarment of an employer. The Administrator, OFLC may not issue 
future labor certifications under this subpart to an employer or any 
successor in interest to that employer, subject to the time limits set 
forth in paragraph (c) of this section, if the Administrator, OFLC finds 
that the employer committed the following violations:
    (1) Willful misrepresentation of a material fact in its H-2B 
Registration, Application for Temporary Employment Certification, or H-
2B Petition;
    (2) Substantial failure to meet any of the terms and conditions of 
its H-2B Registration, Application for Temporary Employment 
Certification, or H-2B Petition. A substantial failure

[[Page 529]]

is a willful failure to comply that constitutes a significant deviation 
from the terms and conditions of such documents; or
    (3) Willful misrepresentation of a material fact to the DOS during 
the visa application process.
    (b) Debarment of an agent or attorney. If the Administrator, OFLC 
finds, under this section, that an attorney or agent committed a 
violation as described in paragraphs (a)(1) through (3) of this section 
or participated in an employer's violation, the Administrator, OFLC may 
not issue future labor certifications to an employer represented by such 
agent or attorney, subject to the time limits set forth in paragraph (c) 
of this section.
    (c) Period of debarment. Debarment under this subpart may not be for 
less than 1 year or more than 5 years from the date of the final agency 
decision.
    (d) Determining whether a violation is willful. A willful 
misrepresentation of a material fact or a willful failure to meet the 
required terms and conditions occurs when the employer, attorney, or 
agent knows a statement is false or that the conduct is in violation, or 
shows reckless disregard for the truthfulness of its representation or 
for whether its conduct satisfies the required conditions.
    (e) Determining whether a violation is significant. In determining 
whether a violation is a significant deviation from the terms and 
conditions of the H-2B Registration, Application for Temporary 
Employment Certification, or H-2B Petition, the factors that the 
Administrator, OFLC may consider include, but are not limited to, the 
following:
    (1) Previous history of violation(s) under the H-2B program;
    (2) The number of H-2B workers, workers in corresponding employment, 
or improperly rejected U.S. applicants who were and/or are affected by 
the violation(s);
    (3) The gravity of the violation(s);
    (4) The extent to which the violator achieved a financial gain due 
to the violation(s), or the potential financial loss or potential injury 
to the worker(s); and
    (5) Whether U.S. workers have been harmed by the violation.
    (f) Violations. Where the standards set forth in paragraphs (d) and 
(e) in this section are met, debarrable violations would include but 
would not be limited to one or more acts of commission or omission which 
involve:
    (1) Failure to pay or provide the required wages, benefits or 
working conditions to the employer's H-2B workers and/or workers in 
corresponding employment;
    (2) Failure, except for lawful, job-related reasons, to offer 
employment to qualified U.S. workers who applied for the job opportunity 
for which certification was sought;
    (3) Failure to comply with the employer's obligations to recruit 
U.S. workers;
    (4) Improper layoff or displacement of U.S. workers or workers in 
corresponding employment;
    (5) Failure to comply with one or more sanctions or remedies imposed 
by the Administrator, WHD for violation(s) of obligations under the job 
order or other H-2B obligations, or with one or more decisions or orders 
of the Secretary or a court under this subpart or 29 CFR part 503;
    (6) Failure to comply with the Notice of Deficiency process under 
this subpart;
    (7) Failure to comply with the assisted recruitment process under 
this subpart;
    (8) Impeding an investigation of an employer under 29 CFR part 503 
or an audit under this subpart;
    (9) Employing an H-2B worker outside the area of intended 
employment, in an activity/activities not listed in the job order, or 
outside the validity period of employment of the job order, including 
any approved extension thereof;
    (10) A violation of the requirements ofSec. 655.20(o) or (p);
    (11) A violation of any of the provisions listed inSec. 655.20(r);
    (12) Any other act showing such flagrant disregard for the law that 
future compliance with program requirements cannot reasonably be 
expected;
    (13) Fraud involving the H-2B Registration, Application for 
Temporary Employment Certification or the H-2B Petition; or
    (14) A material misrepresentation of fact during the registration or 
application process.
    (g) Debarment procedure. (1) Notice of Debarment. If the 
Administrator, OFLC makes a determination to debar an employer, 
attorney, or agent, the Administrator, OFLC will send the party a Notice 
of Debarment. The Notice will state the reason for the debarment 
finding, including a detailed explanation of the grounds for and the 
duration of the debarment and inform the party subject to the notice of 
its right to submit rebuttal evidence or to request a debarment hearing. 
If the party does not file rebuttal evidence or request a hearing within 
30 calendar days of the date of the Notice of Debarment, the notice is 
the final agency action and the debarment will take effect at the end of 
the 30-day period. The timely filing of an rebuttal evidence or a 
request for a hearing stays the debarment pending the outcome of the 
appeal as provided in paragraphs (g)(2)-(6) of this section.
    (2) Rebuttal. The party who received the Notice of Debarment may 
choose to submit evidence to rebut the grounds stated in the notice 
within 30 calendar days of the date the notice is issued. If rebuttal 
evidence is timely filed, the Administrator, OFLC will issue a final 
determination on the debarment within 30 calendar days of receiving the 
rebuttal evidence. If the Administrator, OFLC

[[Page 530]]

determines that the party should be debarred, the Administrator, OFLC 
will inform the party of its right to request a debarment hearing 
according to the procedures in this section. The party must request a 
hearing within 30 calendar days after the date of the Administrator, 
OFLC's final determination, or the Administrator OFLC's determination 
will be the final agency order and the debarment will take effect at the 
end of the 30-day period.
    (3) Hearing. The recipient of a Notice of Debarment seeking to 
challenge the debarment must request a debarment hearing within 30 
calendar days of the date of a Notice of Debarment or the date of a 
final determination of the Administrator, OFLC after review of rebuttal 
evidence submitted under paragraph (g)(2) of this section. To obtain a 
debarment hearing, the recipient must, within 30 days of the date of the 
Notice or the final determination, file a written request with the Chief 
ALJ, United States Department of Labor, 800 K Street, NW., Suite 400-N, 
Washington, DC 20001-8002, and simultaneously serve a copy on the 
Administrator, OFLC. The debarment will take effect 30 calendar days 
from the date the Notice of Debarment or final determination is issued, 
unless a request for review is timely filed. Within 10 business days of 
receipt of the request for a hearing, the Administrator, OFLC will send 
a certified copy of the ETA case file to the Chief ALJ by means normally 
assuring next day delivery. The Chief ALJ will immediately assign an ALJ 
to conduct the hearing. The procedures in 29 CFR part 18 apply to such 
hearings, except that the request for a hearing will not be considered 
to be a complaint to which an answer is required.
    (4) Decision. After the hearing, the ALJ must affirm, reverse, or 
modify the Administrator, OFLC's determination. The ALJ will prepare the 
decision within 60 calendar days after completion of the hearing and 
closing of the record. The ALJ's decision will be provided to the 
parties to the debarment hearing by means normally assuring next day 
delivery. The ALJ's decision is the final agency action, unless either 
party, within 30 calendar days of the ALJ's decision, seeks review of 
the decision with the Administrative Review Board (ARB).
    (5) Review by the ARB. (i) Any party wishing review of the decision 
of an ALJ must, within 30 calendar days of the decision of the ALJ, 
petition the ARB to review the decision. Copies of the petition must be 
served on all parties and on the ALJ. The ARB will decide whether to 
accept the petition within 30 calendar days of receipt. If the ARB 
declines to accept the petition, or if the ARB does not issue a notice 
accepting a petition within 30 calendar days after the receipt of a 
timely filing of the petition, the decision of the ALJ is the final 
agency action. If a petition for review is accepted, the decision of the 
ALJ will be stayed unless and until the ARB issues an order affirming 
the decision. The ARB must serve notice of its decision to accept or not 
to accept the petition upon the ALJ and upon all parties to the 
proceeding.
    (ii) Upon receipt of the ARB's notice to accept the petition, the 
Office of Administrative Law Judges will promptly forward a copy of the 
complete hearing record to the ARB.
    (iii) Where the ARB has determined to review the decision and order, 
the ARB will notify each party of the issue(s) raised, the form in which 
submissions must be made (e.g., briefs or oral argument), and the time 
within which the presentation must be submitted.
    (6) ARB Decision. The ARB's final decision must be issued within 90 
calendar days from the notice granting the petition and served upon all 
parties and the ALJ.
    (h) Concurrent debarment jurisdiction. OFLC and the WHD have 
concurrent jurisdiction to debar under this section or under 29 CFR 
503.24. When considering debarment, OFLC and the WHD will coordinate 
their activities. A specific violation for which debarment is imposed 
will be cited in a single debarment proceeding. Copies of final 
debarment decisions will be forwarded to DHS and DOS promptly.
    (i) Debarment from other foreign labor programs. Upon debarment 
under this subpart or 29 CFR 503.24, the debarred party will be 
disqualified from filing any labor certification applications or labor 
condition applications with the Department by, or on behalf of, the 
debarred party for the same period of time set forth in the final 
debarment decision.



Sec.  655.74  Conduct of proceedings.

    (a) Upon receipt of a timely request for a hearing filed pursuant to 
and in accordance withSec. 655.71, the Chief Administrative Law Judge 
shall promptly appoint an administrative law judge to hear the case.
    (b) The administrative law judge shall notify all parties of the 
date, time and place of the hearing. All parties shall be given at least 
14 calendar days notice of such hearing.
    (c) The administrative law judge may prescribe a schedule by which 
the parties are permitted to file a prehearing brief or other written 
statement of fact or law. Any such brief or statement shall be served 
upon each other party. Post-hearing briefs will not be permitted except 
at the request of the administrative law judge. When permitted, any such 
brief shall be limited to the issue or issues specified by the

[[Page 531]]

administrative law judge, shall be due within the time prescribed by the 
administrative law judge, and shall be served on each other party.

    Effective Date Note: At 77 FR 10169, Feb. 21, 2012,Sec. 655.74 was 
removed and reserved, effective Apr. 23, 2012.



Sec.  655.75  Decision and order of administrative law judge.

    (a) The administrative law judge shall issue a decision. If any 
party desires review of the decision, including judicial review, a 
petition for Administrative Review Board (Board) review thereof shall be 
filed as provided inSec. 655.76. If a petition for review is filed, 
the decision of the administrative law judge shall be inoperative unless 
and until the Board issues an order affirming the decision, or unless 
and until 30 calendar days have passed after the Board's receipt of the 
petition for review and the Board has not issued notice to the parties 
that the Board will review the administrative law judge's decision.
    (b) The decision of the administrative law judge shall include a 
statement of findings and conclusions, with reasons and basis therefore, 
upon each material issue presented on the record. The decision shall 
also include an appropriate order which may affirm, deny, reverse, or 
modify, in whole or in part, the determination of the Administrator, 
WHD; the reason or reasons for such order shall be stated in the 
decision.
    (c) In the event that the WHD Administrator assesses back wages for 
wage violation(s) ofSec. 655.22(e), (g), or (j) based upon a PWD 
obtained by the Administrator from OFLC during the investigation and the 
administrative law judge determines that the Administrator's request was 
not warranted, the administrative law judge shall remand the matter to 
the Administrator for further proceedings on the Administrator's 
determination. If there is no such determination and remand by the 
administrative law judge, the administrative law judge shall accept as 
final and accurate the wage determination obtained from OFLC or, in the 
event the employer filed a timely appeal underSec. 655.11, the final 
wage determination resulting from that process. Under no circumstances 
shall the administrative law judge determine the validity of the wage 
determination or require submission into evidence or disclosure of 
source data or the names of establishments contacted in developing the 
survey which is the basis for the PWD.
    (d) The administrative law judge shall not render determinations as 
to the legality of a regulatory provision or the constitutionality of a 
statutory provision.
    (e) The decision shall be served on all parties in person or by 
certified or regular mail.

    Effective Date Note: At 77 FR 10169, Feb. 21, 2012,Sec. 655.75 was 
removed and reserved, effective Apr. 23, 2012.



Sec.  655.76  Appeal of administrative law judge decision.

    (a) The WHD Administrator or an employer desiring review of the 
decision and order of an administrative law judge, including judicial 
review, shall petition the Department's Administrative Review Board 
(Board) to review the decision and order. To be effective, such petition 
shall be received by the Board within 30 calendar days of the date of 
the decision and order. Copies of the petition shall be served on all 
parties and on the administrative law judge.
    (b) No particular form is prescribed for any petition for the 
Board's review permitted by this subpart. However, any such petition 
shall:
    (1) Be dated;
    (2) Be typewritten or legibly written;
    (3) Specify the issue or issues stated in the administrative law 
judge decision and order giving rise to such petition;
    (4) State the specific reason or reasons why the party petitioning 
for review believes such decision and order are in error;
    (5) Be signed by the party filing the petition or by an authorized 
representative of such party;
    (6) Include the address at which such party or authorized 
representative desires to receive further communications relating 
thereto; and
    (7) Attach copies of the administrative law judge's decision and 
order, and any other record documents which

[[Page 532]]

would assist the Board in determining whether review is warranted.
    (c) Whenever the Board determines to review the decision and order 
of an administrative law judge, a notice of the Board's determination 
shall be served upon the administrative law judge, upon the Office of 
Administrative Law Judges, and upon all parties to the proceeding within 
30 calendar days after the Board's receipt of the petition for review. 
If the Board determines that it will review the decision and order, the 
order shall be inoperative unless and until the Board issues an order 
affirming the decision and order.
    (d) Upon receipt of the Board's notice, the Office of Administrative 
Law Judges shall within 15 calendar days forward the complete hearing 
record to the Board.
    (e) The Board's notice shall specify:
    (1) The issue or issues to be reviewed;
    (2) The form in which submissions shall be made by the parties 
(e.g., briefs); and
    (3) The time within which such submissions shall be made.
    (f) All documents submitted to the Board shall be filed with the 
Administrative Review Board, U.S. Department of Labor, 200 Constitution 
Avenue, NW., Room S-5220, Washington, DC 20210. An original and two 
copies of all documents shall be filed. Documents are not deemed filed 
with the Board until actually received by the Board. All documents, 
including documents filed by mail, shall be received by the Board either 
on or before the due date.
    (g) Copies of all documents filed with the Board shall be served 
upon all other parties involved in the proceeding.
    (h) The Board's final decision shall be served upon all parties and 
the administrative law judge.

    Effective Date Note: At 77 FR 10169, Feb. 21, 2012,Sec. 655.76 was 
removed and reserved, effective Apr. 23, 2012.



Sec.  655.80  Notice to OFLC and DHS.

    (a) The WHD Administrator shall, as appropriate, notify DHS and OFLC 
of the final determination of a violation and recommend that DHS not 
approve petitions filed by an employer. The Administrator's notification 
will address the type of violation committed by the employer and the 
appropriate statutory period for disqualification of the employer from 
approval of petitions.
    (b) The Administrator shall notify DHS and OFLC upon the earliest of 
the following events:
    (1) Where the Administrator determines that there is a basis for a 
finding of violation by an employer, and no timely request for hearing 
is made; or
    (2) Where, after a hearing, the administrative law judge issues a 
decision and order finding a violation by an employer, and no timely 
petition for review is filed with the Department's Administrative Review 
Board (Board); or
    (3) Where a timely petition for review is filed from an 
administrative law judge's decision finding a violation and the Board 
either declines within 30 days to entertain the appeal, or reviews and 
affirms the administrative law judge's determination; or
    (4) Where the administrative law judge finds that there was no 
violation by an employer, and the Board, upon review, issues a decision 
holding that a violation was committed by an employer.

    Effective Date Note: At 77 FR 10169, Feb. 21, 2012,Sec. 655.80 was 
removed and reserved, effective Apr. 23, 2012.



Sec.  655.81  Application filing transition.

    (a) Compliance with these regulations. Except as provided in 
paragraphs (b) and (c) of this section, employers filing applications 
for H-2B workers on or after the effective date of these regulations 
where the date of need for the services or labor to be performed is on 
or after October 1, 2009, must comply with all of the obligations and 
assurances in this subpart. SWAs will no longer accept for processing 
applications filed by employers for H-2B workers for temporary or 
seasonal nonagricultural services on or after January 18, 2009.
    (b) Applications filed under former regulations. (1) For 
applications filed with the SWAs serving the area of intended employment 
prior to the effective date of these regulations, the SWAs shall 
continue to process all active applications under the former regulations 
and transmit all completed applications to the appropriate NPC for 
review and

[[Page 533]]

issuance of a labor certification determination.
    (2) For applications filed with the SWAs serving the area of 
intended employment prior to the effective date of these regulations 
that were completed and transmitted to the NPC, the NPC shall continue 
to process all active applications under the former regulations and 
issue a labor certification determination.
    (c) Applications filed with the NPC under these regulations. 
Employers filing applications on or after the effective date of these 
regulations where their date of need for H-2B workers is prior to 
October 1, 2009, must receive a prevailing wage determination from the 
SWA serving the area of intended employment. The SWA shall process such 
requests in accordance with the provisions ofSec. 655.10. Once the 
employer receives its prevailing wage determination from the SWA, it 
must conduct all of the pre-filing recruitment steps set forth under 
this subpart prior to filing an Application for Temporary Employment 
Certification with the NPC.

[73 FR 78052, Dec. 19, 2008. Redesignated at 74 FR 25985, May 29, 2009]

    Effective Date Note: At 74 FR 25985, May 29, 2009,Sec. 655.5 was 
redesignated asSec. 655.81 and suspended, effective June 29, 2009.

    Effective Date Note: At 77 FR 10169, Feb. 21, 2012,Sec. 655.81 was 
removed and reserved, effective Apr. 23, 2012.



Sec.Sec. 655.82-655.99  [Reserved]

    Effective Date Note: At 77 FR 10169, Feb. 21, 2012, Sec.Sec. 
655.82 through 655.99 are added and reserved, effective Apr. 23, 2012.



    Subpart B_Labor Certification Process for Temporary Agricultural 
             Employment in the United States (H	2A Workers)

    Source: 75 FR 6959, Feb. 12, 2010, unless otherwise noted.



Sec.  655.100  Scope and purpose of subpart B.

    This subpart sets out the procedures established by the Secretary of 
the United States Department of Labor (the Secretary) under the 
authority given in 8 U.S.C. 1188 to acquire information sufficient to 
make factual determinations of:
    (a) Whether there are sufficient able, willing, and qualified United 
States (U.S.) workers available to perform the temporary and seasonal 
agricultural employment for which an employer desires to import 
nonimmigrant foreign workers (H-2A workers); and
    (b) Whether the employment of H-2A workers will adversely affect the 
wages and working conditions of workers in the U.S. similarly employed.



Sec.  655.101  Authority of the Office of Foreign Labor Certification 
(OFLC) Administrator.

    The Secretary has delegated her authority to make determinations 
under 8 U.S.C. 1188 to the Assistant Secretary for the Employment and 
Training Administration (ETA), who in turn has delegated that authority 
to the Office of Foreign Labor Certification (OFLC). The determinations 
are made by the OFLC Administrator who, in turn, may delegate this 
responsibility to designated staff members; e.g., a Certifying Officer 
(CO).



Sec.  655.102  Special procedures.

    To provide for a limited degree of flexibility in carrying out the 
Secretary's responsibilities under the Immigration and Nationality Act 
(INA), while not deviating from statutory requirements, the OFLC 
Administrator has the authority to establish, continue, revise, or 
revoke special procedures for processing certain H-2A applications. 
Employers must demonstrate upon written application to the OFLC 
Administrator that special procedures are necessary. These include 
special procedures currently in effect for the handling of applications 
for sheepherders in the Western States (and adaptation of such 
procedures to occupations in the range production of other livestock), 
and for custom combine harvesting crews. Similarly, for work in 
occupations characterized by other than a reasonably regular workday or 
workweek, such as the range production of sheep or other livestock, the 
OFLC Administrator has the authority to establish monthly, weekly, or 
semi-monthly adverse effect wage rates (AEWR) for those occupations for

[[Page 534]]

a statewide or other geographical area. Prior to making determinations 
under this section, the OFLC Administrator may consult with affected 
employer and worker representatives. Special Procedures in place on the 
effective date of this regulation will remain in force until modified by 
the Administrator.



Sec.  655.103  Overview of this subpart and definition of terms.

    (a) Overview. In order to bring nonimmigrant workers to the U.S. to 
perform agricultural work, an employer must first demonstrate to the 
Secretary that there are not sufficient U.S. workers able, willing, and 
qualified to perform the work in the area of intended employment at the 
time needed and that the employment of foreign workers will not 
adversely affect the wages and working conditions of U.S. workers 
similarly employed. This rule describes a process by which the 
Department of Labor (Department or DOL) makes such a determination and 
certifies its determination to the Department of Homeland Security 
(DHS).
    (b) Definitions. For the purposes of this subpart:
    Administrative Law Judge (ALJ). A person within the Department's 
Office of Administrative Law Judges appointed pursuant to 5 U.S.C. 3105.
    Adverse effect wage rate (AEWR). The annual weighted average hourly 
wage for field and livestock workers (combined) in the States or regions 
as published annually by the U.S. Department of Agriculture (USDA) based 
on its quarterly wage survey.
    Agent. A legal entity or person, such as an association of 
agricultural employers, or an attorney for an association, that:
    (1) Is authorized to act on behalf of the employer for temporary 
agricultural labor certification purposes;
    (2) Is not itself an employer, or a joint employer, as defined in 
this subpart with respect to a specific application; and
    (3) Is not under suspension, debarment, expulsion, or disbarment 
from practice before any court, the Department, the Executive Office for 
Immigration Review, or DHS under 8 CFR 292.3 or 1003.101.
    Agricultural association. Any nonprofit or cooperative association 
of farmers, growers, or ranchers (including but not limited to 
processing establishments, canneries, gins, packing sheds, nurseries, or 
other similar fixed-site agricultural employers), incorporated or 
qualified under applicable State law, that recruits, solicits, hires, 
employs, furnishes, houses, or transports any worker that is subject to 
8 U.S.C. 1188. An agricultural association may act as the agent of an 
employer, or may act as the sole or joint employer of any worker subject 
to 8 U.S.C. 1188.
    Area of intended employment. The geographic area within normal 
commuting distance of the place of the job opportunity for which the 
certification is sought. There is no rigid measure of distance that 
constitutes a normal commuting distance or normal commuting area, 
because there may be widely varying factual circumstances among 
different areas (e.g., average commuting times, barriers to reaching the 
worksite, or quality of the regional transportation network). If the 
place of intended employment is within a Metropolitan Statistical Area 
(MSA), including a multistate MSA, any place within the MSA is deemed to 
be within normal commuting distance of the place of intended employment. 
The borders of MSAs are not controlling in the identification of the 
normal commuting area; a location outside of an MSA may be within normal 
commuting distance of a location that is inside (e.g., near the border 
of) the MSA.
    Attorney. Any person who is a member in good standing of the bar of 
the highest court of any State, possession, territory, or commonwealth 
of the U.S., or the District of Columbia. Such a person is also 
permitted to act as an agent under this subpart. No attorney who is 
under suspension, debarment, expulsion, or disbarment from practice 
before any court, the Department, the Executive Office for Immigration 
Review under 8 CFR 1003.101, or DHS under 8 CFR 292.3 may represent an 
employer under this subpart.
    Certifying Officer (CO). The person who makes determination on an 
Application for Temporary Employment Certification filed under the H-2A 
program.

[[Page 535]]

The OFLC Administrator is the national CO. Other COs may be designated 
by the OFLC Administrator to also make the determinations required under 
this subpart.
    Corresponding employment. The employment of workers who are not H-2A 
workers by an employer who has an approved H-2A Application for 
Temporary Employment Certification in any work included in the job 
order, or in any agricultural work performed by the H-2A workers. To 
qualify as corresponding employment the work must be performed during 
the validity period of the job order, including any approved extension 
thereof.
    Date of need. The first date the employer requires the services of 
H-2A workers as indicated in the Application for Temporary Employment 
Certification.
    Employee. A person who is engaged to perform work for an employer, 
as defined under the general common law of agency. Some of the factors 
relevant to the determination of employee status include: The hiring 
party's right to control the manner and means by which the work is 
accomplished; the skill required to perform the work; the source of the 
instrumentalities and tools for accomplishing the work; the location of 
the work; the hiring party's discretion over when and how long to work; 
and whether the work is part of the regular business of the hiring 
party. Other applicable factors may be considered and no one factor is 
dispositive.
    Employer. A person (including any individual, partnership, 
association, corporation, cooperative, firm, joint stock company, trust, 
or other organization with legal rights and duties) that:
    (1) Has a place of business (physical location) in the U.S. and a 
means by which it may be contacted for employment;
    (2) Has an employer relationship (such as the ability to hire, pay, 
fire, supervise or otherwise control the work of employee) with respect 
to an H-2A worker or a worker in corresponding employment; and
    (3) Possesses, for purposes of filing an Application for Temporary 
Employment Certification, a valid Federal Employer Identification Number 
(FEIN).
    Federal holiday. Legal public holiday as defined at 5 U.S.C. 6103.
    Fixed-site employer. Any person engaged in agriculture who meets the 
definition of an employer, as those terms are defined in this subpart, 
who owns or operates a farm, ranch, processing establishment, cannery, 
gin, packing shed, nursery, or other similar fixed-site location where 
agricultural activities are performed and who recruits, solicits, hires, 
employs, houses, or transports any worker subject to 8 U.S.C. 1188, 29 
CFR part 501, or this subpart as incident to or in conjunction with the 
owner's or operator's own agricultural operation.
    H-2A Labor Contractor (H-2ALC). Any person who meets the definition 
of employer under this subpart and is not a fixed-site employer, an 
agricultural association, or an employee of a fixed-site employer or 
agricultural association, as those terms are used in this part, who 
recruits, solicits, hires, employs, furnishes, houses, or transports any 
worker subject to 8 U.S.C. 1188, 29 CFR part 501, or this subpart.
    H-2A worker. Any temporary foreign worker who is lawfully present in 
the U.S. and authorized by DHS to perform agricultural labor or services 
of a temporary or seasonal nature pursuant to 8 U.S.C. 
1101(a)(15)(H)(ii)(a), as amended.
    Job offer. The offer made by an employer or potential employer of H-
2A workers to both U.S. and H-2A workers describing all the material 
terms and conditions of employment, including those relating to wages, 
working conditions, and other benefits.
    Job opportunity. Full-time employment at a place in the U.S. to 
which U.S. workers can be referred.
    Job Order. The document containing the material terms and conditions 
of employment that is posted by the State Workforce Agency (SWA) on its 
inter- and intra-state job clearance systems based on the employer's 
Agricultural and Food Processing Clearance Order (Form ETA-790), as 
submitted to the SWA.
    Joint employment. Where two or more employers each have sufficient 
definitional indicia of being an employer to be considered the employer 
of a worker, those employers will be considered to jointly employ that 
worker. Each

[[Page 536]]

employer in a joint employment relationship to a worker is considered a 
joint employer of that worker.
    Master application. An Application for Temporary Employment 
Certification filed by an association of agricultural producers as a 
joint employer with its employer-members. A master application must 
cover the same occupations or comparable agricultural employment; the 
same start date of need for all employer-members listed on the 
Application for Temporary Employment Certification; and may cover 
multiple areas of intended employment within a single State but no more 
than two contiguous States.
    National Processing Center (NPC). The office within OFLC in which 
the COs operate and which are charged with the adjudication of 
Applications for Temporary Employment Certification.
    Office of Foreign Labor Certification (OFLC). OFLC means the 
organizational component of the ETA that provides national leadership 
and policy guidance and develops regulations and procedures to carry out 
the responsibilities of the Secretary under the INA concerning the 
admission of foreign workers to the U.S. to perform work described in 8 
U.S.C. 1101(a)(15)(H)(ii)(a).
    OFLC Administrator. The primary official of the Office of Foreign 
Labor Certification (OFLC), or the OFLC Administrator's designee.
    Positive recruitment. The active participation of an employer or its 
authorized hiring agent, performed under the auspices and direction of 
the OFLC, in recruiting and interviewing individuals in the area where 
the employer's job opportunity is located and any other State designated 
by the Secretary as an area of traditional or expected labor supply with 
respect to the area where the employer's job opportunity is located, in 
an effort to fill specific job openings with U.S. workers.
    Prevailing practice. A practice engaged in by employers, that:
    (1) Fifty percent or more of employers in an area and for an 
occupation engage in the practice or offer the benefit; and
    (2) This 50 percent or more of employers also employs 50 percent or 
more of U.S. workers in the occupation and area (including H-2A and non-
H-2A employers) for purposes of determinations concerning the provision 
of family housing, and frequency of wage payments, but non-H-2A 
employers only for determinations concerning the provision of advance 
transportation and the utilization of labor contractors.
    Prevailing wage. Wage established pursuant to 20 CFR 653.501(d)(4).
    State Workforce Agency (SWA). State government agency that receives 
funds pursuant to the Wagner-Peyser Act (29 U.S.C. 49 et seq.) to 
administer the State's public labor exchange activities.
    Strike. A concerted stoppage of work by employees as a result of a 
labor dispute, or any concerted slowdown or other concerted interruption 
of operation (including stoppage by reason of the expiration of a 
collective bargaining agreement).
    Successor in interest. (1) Where an employer has violated 8 U.S.C. 
1188, 29 CFR part 501, or these regulations, and has ceased doing 
business or cannot be located for purposes of enforcement, a successor 
in interest to that employer may be held liable for the duties and 
obligations of the violating employer in certain circumstances. The 
following factors, as used under Title VII of the Civil Rights Act and 
the Vietnam Era Veterans' Readjustment Assistance Act, may be considered 
in determining whether an employer is a successor in interest; no one 
factor is dispositive, but all of the circumstances will be considered 
as a whole:
    (i) Substantial continuity of the same business operations;
    (ii) Use of the same facilities;
    (iii) Continuity of the work force;
    (iv) Similarity of jobs and working conditions;
    (v) Similarity of supervisory personnel;
    (vi) Whether the former management or owner retains a direct or 
indirect interest in the new enterprise;
    (vii) Similarity in machinery, equipment, and production methods;
    (viii) Similarity of products and services; and
    (ix) The ability of the predecessor to provide relief.

[[Page 537]]

    (2) For purposes of debarment only, the primary consideration will 
be the personal involvement of the firm's ownership, management, 
supervisors, and others associated with the firm in the violation(s) at 
issue.
    Temporary agricultural labor certification. Certification made by 
the OFLC Administrator with respect to an employer seeking to file with 
DHS a visa petition to employ one or more foreign nationals as an H-2A 
worker, pursuant to 8 U.S.C. 1101(a)(15)(H)(ii)(a), 1184(a) and (c), and 
1188.
    United States (U.S.). The continental U.S., Alaska, Hawaii, the 
Commonwealth of Puerto Rico, and the territories of Guam, the U.S. 
Virgin Islands, and the Commonwealth of the Northern Mariana Islands 
(CNMI).
    United States worker (U.S. worker). A worker who is:
    (1) A citizen or national of the U.S.; or
    (2) An alien who is lawfully admitted for permanent residence in the 
U.S., is admitted as a refugee under 8 U.S.C. 1157, is granted asylum 
under 8 U.S.C. 1158, or is an immigrant otherwise authorized (by the INA 
or by DHS) to be employed in the U.S.; or
    (3) An individual who is not an unauthorized alien (as defined in 8 
U.S.C. 1324a(h)(3)) with respect to the employment in which the worker 
is engaging.
    Wages. All forms of cash remuneration to a worker by an employer in 
payment for personal services.
    Work contract. All the material terms and conditions of employment 
relating to wages, hours, working conditions, and other benefits, 
including those required by 8 U.S.C. 1188, 29 CFR part 501, or this 
subpart. The contract between the employer and the worker may be in the 
form of a separate written document. In the absence of a separate 
written work contract incorporating the required terms and conditions of 
employment, agreed to by both the employer and the worker, the work 
contract at a minimum will be the terms of the job order and any 
obligations required under 8 U.S.C. 1188, 28 CFR part 501, or this 
subpart.
    (c) Definition of agricultural labor or services. For the purposes 
of this subpart, agricultural labor or services, pursuant to 8 U.S.C. 
1101(a)(15)(H)(ii)(a), is defined as: agricultural labor as defined and 
applied in sec. 3121(g) of the Internal Revenue Code of 1986 at 26 
U.S.C. 3121(g); agriculture as defined and applied in sec. 3(f) of the 
Fair Labor Standards Act of 1938 (FLSA) at 29 U.S.C. 203(f); the 
pressing of apples for cider on a farm; or logging employment. An 
occupation included in either statutory definition is agricultural labor 
or services, notwithstanding the exclusion of that occupation from the 
other statutory definition. For informational purposes, the statutory 
provisions are listed below.
    (1)(i) Agricultural labor for the purpose of paragraph (c) of this 
section means all service performed:
    (A) On a farm, in the employ of any person, in connection with 
cultivating the soil, or in connection with raising or harvesting any 
agricultural or horticultural commodity, including the raising, 
shearing, feeding, caring for, training, and management of livestock, 
bees, poultry, and fur-bearing animals and wildlife;
    (B) In the employ of the owner or tenant or other operator of a 
farm, in connection with the operation, management, conservation, 
improvement, or maintenance of such farm and its tools and equipment, or 
in salvaging timber or clearing land of brush and other debris left by a 
hurricane, if the major part of such service is performed on a farm;
    (C) In connection with the production or harvesting of any commodity 
defined as an agricultural commodity in section 15(g) of the 
Agricultural Marketing Act, as amended (12 U.S.C. 1141j), or in 
connection with the ginning of cotton, or in connection with the 
operation or maintenance of ditches, canals, reservoirs, or waterways, 
not owned or operated for profit, used exclusively for supplying and 
storing water for farming purposes;
    (D) In the employ of the operator of a farm in handling, planting, 
drying, packing, packaging, processing, freezing, grading, storing, or 
delivering to storage or to market or to a carrier for transportation to 
market, in its unmanufactured state, any agricultural or horticultural 
commodity; but only if such operator produced more than one-

[[Page 538]]

half of the commodity with respect to which such service is performed;
    (E) In the employ of a group of operators of farms (other than a 
cooperative organization) in the performance of service described in 
paragraph (c)(1)(iv) of this section but only if such operators produced 
all of the commodity with respect to which such service is performed. 
For purposes of this paragraph, any unincorporated group of operators 
shall be deemed a cooperative organization if the number of operators 
comprising such group is more than 20 at any time during the calendar 
year in which such service is performed;
    (F) The provisions of paragraphs (c)(1)(iv) and (c)(1)(v) of this 
section shall not be deemed to be applicable with respect to service 
performed in connection with commercial canning or commercial freezing 
or in connection with any agricultural or horticultural commodity after 
its delivery to a terminal market for distribution for consumption; or
    (G) On a farm operated for profit if such service is not in the 
course of the employer's trade or business or is domestic service in a 
private home of the employer.
    (ii) As used in this section, the term farm includes stock, dairy, 
poultry, fruit, fur-bearing animal, and truck farms, plantations, 
ranches, nurseries, ranges, greenhouses or other similar structures used 
primarily for the raising of agricultural or horticultural commodities, 
and orchards.
    (2) Agriculture. For purposes of paragraph (c) of this section, 
agriculture means farming in all its branches and among other things 
includes the cultivation and tillage of the soil, dairying, the 
production, cultivation, growing, and harvesting of any agricultural or 
horticultural commodities (including commodities defined as agricultural 
commodities in 1141j(g) of title 12, the raising of livestock, bees, 
fur-bearing animals, or poultry, and any practices (including any 
forestry or lumbering operations) performed by a farmer or on a farm as 
an incident to or in conjunction with such farming operations, including 
preparation for market, delivery to storage or to market or to carriers 
for transportation to market. See sec. 29 U.S.C. 203(f), as amended 
(sec. 3(f) of the FLSA, as codified). Under 12 U.S.C. 1141j(g) 
agricultural commodities include, in addition to other agricultural 
commodities, crude gum (oleoresin) from a living tree, and the following 
products as processed by the original producer of the crude gum 
(oleoresin) from which derived: gum spirits of turpentine and gum rosin. 
In addition as defined in 7 U.S.C. 92, gum spirits of turpentine means 
spirits of turpentine made from gum (oleoresin) from a living tree and 
gum rosin means rosin remaining after the distillation of gum spirits of 
turpentine.
    (3) Apple pressing for cider. The pressing of apples for cider on a 
farm, as the term farm is defined and applied in sec. 3121(g) of the 
Internal Revenue Code at 26 U.S.C. 3121(g) or as applied in sec. 3(f) of 
the FLSA at 29 U.S.C. 203(f), pursuant to 29 CFR part 780.
    (4) Logging employment. Operations associated with felling and 
moving trees and logs from the stump to the point of delivery, such as, 
but not limited to, marking danger trees and trees/logs to be cut to 
length, felling, limbing, bucking, debarking, chipping, yarding, 
loading, unloading, storing, and transporting machines, equipment and 
personnel to, from and between logging sites.
    (d) Definition of a temporary or seasonal nature. For the purposes 
of this subpart, employment is of a seasonal nature where it is tied to 
a certain time of year by an event or pattern, such as a short annual 
growing cycle or a specific aspect of a longer cycle, and requires labor 
levels far above those necessary for ongoing operations. Employment is 
of a temporary nature where the employer's need to fill the position 
with a temporary worker will, except in extraordinary circumstances, 
last no longer than 1 year.

                          Prefiling Procedures



Sec.  655.120  Offered wage rate.

    (a) To comply with its obligation underSec. 655.122(l), an 
employer must offer, advertise in its recruitment, and pay a wage that 
is the highest of the AEWR, the prevailing hourly wage or piece rate, 
the agreed-upon collective bargaining wage, or the Federal or

[[Page 539]]

State minimum wage, except where a special procedure is approved for an 
occupation or specific class of agricultural employment.
    (b) If the prevailing hourly wage rate or piece rate is adjusted 
during a work contract, and is higher than the highest of the AEWR, the 
prevailing wage, the agreed-upon collective bargaining wage, or the 
Federal or State minimum wage, in effect at the time the work is 
performed, the employer must pay that higher prevailing wage or piece 
rate, upon notice to the employer by the Department.
    (c) The OFLC Administrator will publish, at least once in each 
calendar year, on a date to be determined by the OFLC Administrator, the 
AEWRs for each State as a notice in the Federal Register.



Sec.  655.121  Job orders.

    (a) Area of intended employment. (1) Prior to filing an Application 
for Temporary Employment Certification, the employer must submit a job 
order, Form ETA-790, to the SWA serving the area of intended employment 
for intrastate clearance, identifying it as a job order to be placed in 
connection with a future Application for Temporary Employment 
Certification for H-2A workers. The employer must submit this job order 
no more than 75 calendar days and no fewer than 60 calendar days before 
the date of need. If the job opportunity is located in more than one 
State within the same area of intended employment, the employer may 
submit a job order to any one of the SWAs having jurisdiction over the 
anticipated worksites.
    (2) Where the job order is being placed in connection with a future 
master application to be filed by an association of agricultural 
employers as a joint employer, the association may submit a single job 
order to be placed in the name of the association on behalf of all 
employers that will be duly named on the Application for Temporary 
Employment Certification.
    (3) The job order submitted to the SWA must satisfy the requirements 
for agricultural clearance orders in 20 CFR part 653, subpart F and the 
requirements set forth inSec. 655.122.
    (b) SWA review. (1) The SWA will review the contents of the job 
order for compliance with the requirements specified in 20 CFR part 653, 
subpart F and this subpart, and will work with the employer to address 
any noted deficiencies. The SWA must notify the employer in writing of 
any deficiencies in its job order no later than 7 calendar days after it 
has been submitted. The SWA notification will direct the employer to 
respond to the noted deficiencies. The employer must respond to the 
deficiencies noted by the SWA within 5 calendar days after receipt of 
the SWA notification. The SWA must respond to the employer's response 
within 3 calendar days.
    (2) If, after providing responses to the deficiencies noted by the 
SWA, the employer is not able to resolve the deficiencies with the SWA, 
the employer may file an Application for Temporary Employment 
Certification pursuant to the emergency filing procedures contained in 
Sec.  655.134, with a statement describing the nature of the dispute and 
demonstrating compliance with its requirements under this section. In 
the event the SWA does not respond within the stated timelines, the 
employer may use the emergency filing procedures noted above. If upon 
review of the Application for Temporary Employment Certification and the 
job order and all other relevant information, the CO concludes that the 
job order is acceptable, the CO will direct the SWA to place the job 
order into intrastate and interstate clearance and otherwise process the 
Application in accordance with the procedures contained inSec. 
655.134(c). If the CO determines the job order is not acceptable, the CO 
will issue a Notice of Deficiency to the employer underSec. 655.143 of 
this subpart directing the employer to modify the job order pursuant to 
paragraph (e) of this section The Notice of Deficiency will offer the 
employer the right to appeal.
    (c) Intrastate clearance. Upon its clearance of the job order, the 
SWA must promptly place the job order in intrastate clearance and 
commence recruitment of U.S. workers. Where the employer's job order 
references an area of intended employment which falls within the 
jurisdiction of more than one SWA, the originating SWA will

[[Page 540]]

also forward a copy of the approved job order to the other SWAs serving 
the area of intended employment.
    (d) Duration of job order posting. The SWA must keep the job order 
on its active file until the end of the recruitment period, as set forth 
inSec. 655.135(d), and must refer each U.S. worker who applies (or on 
whose behalf an Application for Temporary Employment Certification is 
made) for the job opportunity.
    (e) Modifications to the job order. (1) Prior to the issuance of the 
final determination, the CO may require modifications to the job order 
when the CO determines that the offer of employment does not contain all 
the minimum benefits, wages, and working condition provisions. Such 
modifications must be made or certification will be denied pursuant to 
Sec.  655.164 of this subpart.
    (2) The employer may request a modification of the job order, Form 
ETA-790, prior to the submission of an Application for Temporary 
Employment Certification. However, the employer may not reject referrals 
against the job order based upon a failure on the part of the applicant 
to meet the amended criteria, if such referral was made prior to the 
amendment of the job order. The employer may not amend the job order on 
or after the date of filing an Application for Temporary Employment 
Certification.
    (3) The employer must provide all workers recruited in connection 
with the Application for Temporary Employment Certification with a copy 
of the modified job order or work contract which reflects the amended 
terms and conditions, on the first day of employment, in accordance with 
Sec.  655.122(q), or as soon as practicable, whichever comes first.



Sec.  655.122  Contents of job offers.

    (a) Prohibition against preferential treatment of aliens. The 
employer's job offer must offer to U.S. workers no less than the same 
benefits, wages, and working conditions that the employer is offering, 
intends to offer, or will provide to H-2A workers. Job offers may not 
impose on U.S. workers any restrictions or obligations that will not be 
imposed on the employer's H-2A workers. This does not relieve the 
employer from providing to H-2A workers at least the same level of 
minimum benefits, wages, and working conditions which must be offered to 
U.S. workers consistent with this section.
    (b) Job qualifications and requirements. Each job qualification and 
requirement listed in the job offer must be bona fide and consistent 
with the normal and accepted qualifications required by employers that 
do not use H-2A workers in the same or comparable occupations and crops. 
Either the CO or the SWA may require the employer to submit 
documentation to substantiate the appropriateness of any job 
qualification specified in the job offer.
    (c) Minimum benefits, wages, and working conditions. Every job order 
accompanying an Application for Temporary Employment Certification must 
include each of the minimum benefit, wage, and working condition 
provisions listed in paragraphs (d) through (q) of this section.
    (d) Housing. (1) Obligation to provide housing. The employer must 
provide housing at no cost to the H-2A workers and those workers in 
corresponding employment who are not reasonably able to return to their 
residence within the same day. Housing must be provided through one of 
the following means:
    (i) Employer-provided housing. Employer-provided housing must meet 
the full set of DOL Occupational Safety and Health Administration (OSHA) 
standards set forth at 29 CFR 1910.142, or the full set of standards at 
Sec.Sec. 654.404 through 654.417 of this chapter, whichever are 
applicable underSec. 654.401 of this chapter. Requests by employers 
whose housing does not meet the applicable standards for conditional 
access to the interstate clearance system, will be processed under the 
procedures set forth atSec. 654.403 of this chapter; or
    (ii) Rental and/or public accommodations. Rental or public 
accommodations or other substantially similar class of habitation must 
meet local standards for such housing. In the absence of applicable 
local standards, State standards will apply. In the absence of 
applicable local or State standards, DOL OSHA standards at 29 CFR 
1910.142 will apply. Any charges for rental housing must be paid 
directly by the employer

[[Page 541]]

to the owner or operator of the housing. The employer must document to 
the satisfaction of the CO that the housing complies with the local, 
State, or Federal housing standards.
    (2) Standards for range housing. Housing for workers principally 
engaged in the range production of livestock must meet standards of DOL 
OSHA for such housing. In the absence of such standards, range housing 
for sheepherders and other workers engaged in the range production of 
livestock must meet guidelines issued by OFLC.
    (3) Deposit charges. Charges in the form of deposits for bedding or 
other similar incidentals related to housing must not be levied upon 
workers. However, employers may require workers to reimburse them for 
damage caused to housing by the individual worker(s) found to have been 
responsible for damage which is not the result of normal wear and tear 
related to habitation.
    (4) Charges for public housing. If public housing provided for 
migrant agricultural workers under the auspices of a local, county, or 
State government is secured by the employer, the employer must pay any 
charges normally required for use of the public housing units directly 
to the housing's management.
    (5) Family housing. When it is the prevailing practice in the area 
of intended employment and the occupation to provide family housing, it 
must be provided to workers with families who request it.
    (6) Certified housing that becomes unavailable. If after a request 
to certify housing, such housing becomes unavailable for reasons outside 
the employer's control, the employer may substitute other rental or 
public accommodation housing that is in compliance with the local, 
State, or Federal housing standards applicable under this section. The 
employer must promptly notify the SWA in writing of the change in 
accommodations and the reason(s) for such change and provide the SWA 
evidence of compliance with the applicable local, State or Federal 
safety and health standards, in accordance with the requirements of this 
section. If, upon inspection, the SWA determines the substituted housing 
does not meet the applicable housing standards, the SWA must promptly 
provide written notification to the employer to cure the deficiencies 
with a copy to the CO. An employer's failure to provide housing that 
complies with the applicable standards will result in either a denial of 
a pending Application for Temporary Employment Certification or 
revocation of the temporary labor certification granted under this 
subpart.
    (e) Workers' compensation. (1) The employer must provide workers' 
compensation insurance coverage in compliance with State law covering 
injury and disease arising out of and in the course of the worker's 
employment. If the type of employment for which the certification is 
sought is not covered by or is exempt from the State's workers' 
compensation law, the employer must provide, at no cost to the worker, 
insurance covering injury and disease arising out of and in the course 
of the worker's employment that will provide benefits at least equal to 
those provided under the State workers' compensation law for other 
comparable employment.
    (2) Prior to issuance of the temporary labor certification, the 
employer must provide the CO with proof of workers' compensation 
insurance coverage meeting the requirements of this paragraph, including 
the name of the insurance carrier, the insurance policy number, and 
proof of insurance for the dates of need, or, if appropriate, proof of 
State law coverage.
    (f) Employer-provided items. The employer must provide to the 
worker, without charge or deposit charge, all tools, supplies, and 
equipment required to perform the duties assigned.
    (g) Meals. The employer either must provide each worker with three 
meals a day or must furnish free and convenient cooking and kitchen 
facilities to the workers that will enable the workers to prepare their 
own meals. Where the employer provides the meals, the job offer must 
state the charge, if any, to the worker for such meals. The amount of 
meal charges is governed bySec. 655.173.
    (h) Transportation; daily subsistence--(1) Transportation to place 
of employment. If the employer has not previously advanced such 
transportation and subsistence costs to the worker or

[[Page 542]]

otherwise provided such transportation or subsistence directly to the 
worker by other means and if the worker completes 50 percent of the work 
contract period, the employer must pay the worker for reasonable costs 
incurred by the worker for transportation and daily subsistence from the 
place from which the worker has come to work for the employer, whether 
in the U.S. or abroad to the place of employment. When it is the 
prevailing practice of non-H-2A agricultural employers in the occupation 
in the area to do so, or when the employer extends such benefits to 
similarly situated H-2A workers, the employer must advance the required 
transportation and subsistence costs (or otherwise provide them) to 
workers in corresponding employment who are traveling to the employer's 
worksite. The amount of the transportation payment must be no less (and 
is not required to be more) than the most economical and reasonable 
common carrier transportation charges for the distances involved. The 
amount of the daily subsistence payment must be at least as much as the 
employer would charge the worker for providing the worker with three 
meals a day during employment (if applicable), but in no event less than 
the amount permitted underSec. 655.173(a). Note that the FLSA applies 
independently of the H-2A requirements and imposes obligations on 
employers regarding payment of wages.
    (2) Transportation from place of employment. If the worker completes 
the work contract period, or if the employee is terminated without 
cause, and the worker has no immediate subsequent H-2A employment, the 
employer must provide or pay for the worker's transportation and daily 
subsistence from the place of employment to the place from which the 
worker, disregarding intervening employment, departed to work for the 
employer. If the worker has contracted with a subsequent employer who 
has not agreed in such work contract to provide or pay for the worker's 
transportation and daily subsistence expenses from the employer's 
worksite to such subsequent employer's worksite, the employer must 
provide or pay for such expenses. If the worker has contracted with a 
subsequent employer who has agreed in such work contract to provide or 
pay for the worker's transportation and daily subsistence expenses from 
the employer's worksite to such subsequent employer's worksite, the 
subsequent employer must provide or pay for such expenses. The employer 
is not relieved of its obligation to provide or pay for return 
transportation and subsistence if an H-2A worker is displaced as a 
result of the employer's compliance with the 50 percent rule as 
described inSec. 655.135(d) of this subpart with respect to the 
referrals made after the employer's date of need.
    (3) Transportation between living quarters and worksite. The 
employer must provide transportation between housing provided or secured 
by the employer and the employer's worksite at no cost to the worker.
    (4) Employer-provided transportation. All employer-provided 
transportation must comply with all applicable Federal, State or local 
laws and regulations, and must provide, at a minimum, the same 
transportation safety standards, driver licensure, and vehicle insurance 
as required under 29 U.S.C. 1841 and 29 CFR 500.105 and 29 CFR 500.120 
to 500.128. If workers' compensation is used to cover transportation, in 
lieu of vehicle insurance, the employer must either ensure that the 
workers' compensation covers all travel or that vehicle insurance exists 
to provide coverage for travel not covered by workers' compensation and 
they must have property damage insurance.
    (i) Three-fourths guarantee--(1) Offer to worker. The employer must 
guarantee to offer the worker employment for a total number of work 
hours equal to at least three-fourths of the workdays of the total 
period beginning with the first workday after the arrival of the worker 
at the place of employment or the advertised contractual first date of 
need, whichever is later, and ending on the expiration date specified in 
the work contract or in its extensions, if any.
    (i) For purposes of this paragraph a workday means the number of 
hours in a workday as stated in the job order and excludes the worker's 
Sabbath and Federal holidays. The employer must offer a total number of 
hours to ensure the provision of sufficient work to

[[Page 543]]

reach the three-fourths guarantee. The work hours must be offered during 
the work period specified in the work contract, or during any modified 
work contract period to which the worker and employer have mutually 
agreed and that has been approved by the CO.
    (ii) The work contract period can be shortened by agreement of the 
parties only with the approval of the CO. In the event the worker begins 
working later than the specified beginning date of the contract, the 
guarantee period begins with the first workday after the arrival of the 
worker at the place of employment, and continues until the last day 
during which the work contract and all extensions thereof are in effect.
    (iii) Therefore, if, for example, a work contract is for a 10-week 
period, during which a normal workweek is specified as 6 days a week, 8 
hours per day, the worker would have to be guaranteed employment for at 
least 360 hours (10 weeks x 48 hours/week = 480 hours x 75 percent = 
360). If a Federal holiday occurred during the 10-week span, the 8 hours 
would be deducted from the total hours for the work contract, before the 
guarantee is calculated. Continuing with the above example, the worker 
would have to be guaranteed employment for 354 hours (10 weeks x 48 
hours/week = 480 hours - 8 hours (Federal holiday) x 75 percent = 354 
hours).
    (iv) A worker may be offered more than the specified hours of work 
on a single workday. For purposes of meeting the guarantee, however, the 
worker will not be required to work for more than the number of hours 
specified in the job order for a workday, or on the worker's Sabbath or 
Federal holidays. However, all hours of work actually performed may be 
counted by the employer in calculating whether the period of guaranteed 
employment has been met. If during the total work contract period the 
employer affords the U.S. or H-2A worker less employment than that 
required under this paragraph, the employer must pay such worker the 
amount the worker would have earned had the worker, in fact, worked for 
the guaranteed number of days. An employer will not be considered to 
have met the work guarantee if the employer has merely offered work on 
three-fourths of the workdays if each workday did not consist of a full 
number of hours of work time as specified in the job order.
    (2) Guarantee for piece rate paid worker. If the worker is paid on a 
piece rate basis, the employer must use the worker's average hourly 
piece rate earnings or the required hourly wage rate, whichever is 
higher, to calculate the amount due under the guarantee.
    (3) Failure to work. Any hours the worker fails to work, up to a 
maximum of the number of hours specified in the job order for a workday, 
when the worker has been offered an opportunity to work in accordance 
with paragraph (i)(1) of this section, and all hours of work actually 
performed (including voluntary work over 8 hours in a workday or on the 
worker's Sabbath or Federal holidays), may be counted by the employer in 
calculating whether the period of guaranteed employment has been met. An 
employer seeking to calculate whether the number of hours has been met 
must maintain the payroll records in accordance with this subpart.
    (4) Displaced H-2A worker. The employer is not liable for payment of 
the three-fourths guarantee to an H-2A worker whom the CO certifies is 
displaced because of the employer's compliance with the 50 percent rule 
described inSec. 655.135(d) with respect to referrals made during that 
period.
    (5) Obligation to provide housing and meals. Notwithstanding the 
three-fourths guarantee contained in this section, employers are 
obligated to provide housing and meals in accordance with paragraphs (d) 
and (g) of this section for each day of the contract period up until the 
day the workers depart for other H-2A employment, depart to the place 
outside of the U.S. from which the worker came, or, if the worker 
voluntarily abandons employment or is terminated for cause, the day of 
such abandonment or termination.
    (j) Earnings records. (1) The employer must keep accurate and 
adequate records with respect to the workers' earnings, including but 
not limited to field tally records, supporting summary payroll records, 
and records

[[Page 544]]

showing the nature and amount of the work performed; the number of hours 
of work offered each day by the employer (broken out by hours offered 
both in accordance with and over and above the three-fourths guarantee 
at paragraph (i)(3) of this section); the hours actually worked each day 
by the worker; the time the worker began and ended each workday; the 
rate of pay (both piece rate and hourly, if applicable); the worker's 
earnings per pay period; the worker's home address; and the amount of 
and reasons for any and all deductions taken from the worker's wages.
    (2) Each employer must keep the records required by this part, 
including field tally records and supporting summary payroll records, 
safe and accessible at the place or places of employment, or at one or 
more established central recordkeeping offices where such records are 
customarily maintained. All records must be available for inspection and 
transcription by the Secretary or a duly authorized and designated 
representative, and by the worker and representatives designated by the 
worker as evidenced by appropriate documentation (an Entry of Appearance 
as Attorney or Representative, Form G-28, signed by the worker, or an 
affidavit signed by the worker confirming such representation). Where 
the records are maintained at a central recordkeeping office, other than 
in the place or places of employment, such records must be made 
available for inspection and copying within 72 hours following notice 
from the Secretary, or a duly authorized and designated representative, 
and by the worker and designated representatives as described in this 
paragraph.
    (3) To assist in determining whether the three-fourths guarantee in 
paragraph (i) of this section has been met, if the number of hours 
worked by the worker on a day during the work contract period is less 
than the number of hours offered, as specified in the job offer, the 
records must state the reason or reasons therefore.
    (4) The employer must retain the records for not less than 3 years 
after the date of the certification.
    (k) Hours and earnings statements. The employer must furnish to the 
worker on or before each payday in one or more written statements the 
following information:
    (1) The worker's total earnings for the pay period;
    (2) The worker's hourly rate and/or piece rate of pay;
    (3) The hours of employment offered to the worker (showing offers in 
accordance with the three-fourths guarantee as determined in paragraph 
(i) of this section, separate from any hours offered over and above the 
guarantee);
    (4) The hours actually worked by the worker;
    (5) An itemization of all deductions made from the worker's wages;
    (6) If piece rates are used, the units produced daily;
    (7) Beginning and ending dates of the pay period; and
    (8) The employer's name, address and FEIN.
    (l) Rates of pay. If the worker is paid by the hour, the employer 
must pay the worker at least the AEWR, the prevailing hourly wage rate, 
the prevailing piece rate, the agreed-upon collective bargaining rate, 
or the Federal or State minimum wage rate, in effect at the time work is 
performed, whichever is highest, for every hour or portion thereof 
worked during a pay period.
    (1) The offered wage may not be based on commission, bonuses, or 
other incentives, unless the employer guarantees a wage paid on a 
weekly, semi-monthly, or monthly basis that equals or exceeds the AEWR, 
prevailing hourly wage or piece rate, the legal Federal or State minimum 
wage, or any agreed-upon collective bargaining rate, whichever is 
highest; or
    (2) If the worker is paid on a piece rate basis and at the end of 
the pay period the piece rate does not result in average hourly piece 
rate earnings during the pay period at least equal to the amount the 
worker would have earned had the worker been paid at the appropriate 
hourly rate:
    (i) The worker's pay must be supplemented at that time so that the 
worker's earnings are at least as much as the worker would have earned 
during the pay period if the worker had instead been paid at the 
appropriate hourly wage rate for each hour worked;

[[Page 545]]

    (ii) The piece rate must be no less than the piece rate prevailing 
for the activity in the area of intended employment; and
    (iii) If the employer who pays by the piece rate requires one or 
more minimum productivity standards of workers as a condition of job 
retention, such standards must be specified in the job offer and be no 
more than those required by the employer in 1977, unless the OFLC 
Administrator approves a higher minimum, or, if the employer first 
applied for H-2A temporary labor certification after 1977, such 
standards must be no more than those normally required (at the time of 
the first Application for Temporary Employment Certification) by other 
employers for the activity in the area of intended employment.
    (m) Frequency of pay. The employer must state in the job offer the 
frequency with which the worker will be paid, which must be at least 
twice monthly or according to the prevailing practice in the area of 
intended employment, whichever is more frequent. Employers must pay 
wages when due.
    (n) Abandonment of employment or termination for cause. If the 
worker voluntarily abandons employment before the end of the contract 
period, or is terminated for cause, and the employer notifies the NPC, 
and DHS in the case of an H-2A worker, in writing or by any other method 
specified by the Department or DHS in a manner specified in a notice 
published in the Federal Register not later than 2 working days after 
such abandonment occurs, the employer will not be responsible for 
providing or paying for the subsequent transportation and subsistence 
expenses of that worker under this section, and that worker is not 
entitled to the three-fourths guarantee described in paragraph (i) of 
this section. Abandonment will be deemed to begin after a worker fails 
to report for work at the regularly scheduled time for 5 consecutive 
working days without the consent of the employer.
    (o) Contract impossibility. If, before the expiration date specified 
in the work contract, the services of the worker are no longer required 
for reasons beyond the control of the employer due to fire, weather, or 
other Act of God that makes the fulfillment of the contract impossible, 
the employer may terminate the work contract. Whether such an event 
constitutes a contract impossibility will be determined by the CO. In 
the event of such termination of a contract, the employer must fulfill a 
three-fourths guarantee for the time that has elapsed from the start of 
the work contract to the time of its termination, as described in 
paragraph (i)(1) of this section. The employer must make efforts to 
transfer the worker to other comparable employment acceptable to the 
worker, consistent with existing immigration law, as applicable. If such 
transfer is not affected, the employer must:
    (1) Return the worker, at the employer's expense, to the place from 
which the worker (disregarding intervening employment) came to work for 
the employer, or transport the worker to the worker's next certified H-
2A employer, whichever the worker prefers;
    (2) Reimburse the worker the full amount of any deductions made from 
the worker's pay by the employer for transportation and subsistence 
expenses to the place of employment; and
    (3) Pay the worker for any costs incurred by the worker for 
transportation and daily subsistence to that employer's place of 
employment. Daily subsistence must be computed as set forth in paragraph 
(h) of this section. The amount of the transportation payment must not 
be less (and is not required to be more) than the most economical and 
reasonable common carrier transportation charges for the distances 
involved.
    (p) Deductions. (1) The employer must make all deductions from the 
worker's paycheck required by law. The job offer must specify all 
deductions not required by law which the employer will make from the 
worker's paycheck. All deductions must be reasonable. The employer may 
deduct the cost of the worker's transportation and daily subsistence 
expenses to the place of employment which were borne directly by the 
employer. In such circumstances, the job offer must state that the 
worker will be reimbursed the full amount of such deduction upon the 
worker's completion of 50 percent of the work contract period. However, 
an employer

[[Page 546]]

subject to the FLSA may not make deductions that would violate the FLSA.
    (2) A deduction is not reasonable if it includes a profit to the 
employer or to any affiliated person. A deduction that is primarily for 
the benefit or convenience of the employer will not be recognized as 
reasonable and therefore the cost of such an item may not be included in 
computing wages. The wage requirements ofSec. 655.120 will not be met 
where undisclosed or unauthorized deductions, rebates, or refunds reduce 
the wage payment made to the employee below the minimum amounts required 
under this subpart, or where the employee fails to receive such amounts 
free and clear because the employee kicks back directly or indirectly to 
the employer or to another person for the employer's benefit the whole 
or part of the wage delivered to the employee. The principles applied in 
determining whether deductions are reasonable and payments are received 
free and clear, and the permissibility of deductions for payments to 
third persons are explained in more detail in 29 CFR part 531.
    (q) Disclosure of work contract. The employer must provide to an H-
2A worker no later than the time at which the worker applies for the 
visa, or to a worker in corresponding employment no later than on the 
day work commences, a copy of the work contract between the employer and 
the worker in a language understood by the worker as necessary or 
reasonable. For an H-2A worker going from an H-2A employer to a 
subsequent H-2A employer, the copy must be provided no later than the 
time an offer of employment is made by the subsequent H-2A employer. At 
a minimum, the work contract must contain all of the provisions required 
by this section. In the absence of a separate, written work contract 
entered into between the employer and the worker, the required terms of 
the job order and the certified Application for Temporary Employment 
Certification will be the work contract.

  Application for Temporary Employment Certification Filing Procedures



Sec.  655.130  Application filing requirements.

    All agricultural employers who desire to hire H-2A foreign 
agricultural workers must apply for a certification from the Secretary 
by filing an Application for Temporary Employment Certification with the 
NPC designated by the OFLC Administrator. The following section provides 
the procedures employers must follow when filing.
    (a) What to file. An employer, whether individual, association, or 
an H-2ALC, that desires to apply for temporary employment certification 
of one or more nonimmigrant foreign workers must file a completed 
Application for Temporary Employment Certification form and, unless a 
specific exemption applies, a copy of Form ETA-790, submitted to the SWA 
serving the area of intended employment, as set forth inSec. 
655.121(a).
    (b) Timeliness. A completed Application for Temporary Employment 
Certification must be filed no less than 45 calendar days before the 
employer's date of need.
    (c) Location and method of filing. The employer may send the 
Application for Temporary Employment Certification and all required 
supporting documentation by U.S. Mail or private mail courier to the 
NPC. The Department will publish a Notice in the Federal Register 
identifying the address(es), and any future address changes, to which 
Applications for Temporary Employment Certification must be mailed, and 
will also post these addresses on the OFLC Internet Web site at http://
www.foreignlaborcert.doleta.gov/. The Department may also require 
Applications for Temporary Employment Certification, at a future date, 
to be filed electronically in addition to or instead of by mail, notice 
of which will be published in the Federal Register.
    (d) Original signature. The Application for Temporary Employment 
Certification must bear the original signature of the employer (and that 
of the employer's authorized attorney or agent if the employer is 
represented by an attorney or agent). An association filing a master

[[Page 547]]

application as a joint employer may sign on behalf of its employer 
members. An association filing as an agent may not sign on behalf of its 
members but must obtain each member's signature on each Application for 
Temporary Employment Certification prior to filing.
    (e) Information received in the course of processing Applications 
for Temporary Employment Certification and program integrity measures 
such as audits may be forwarded from OFLC to Wage and Hour Division 
(WHD) for enforcement purposes.



Sec.  655.131  Association filing requirements.

    If an association files an Application for Temporary Employment 
Certification, in addition to complying with all the assurances, 
guarantees, and other requirements contained in this subpart and in part 
653, subpart F, of this chapter, the following requirements also apply.
    (a) Individual applications. Associations of agricultural employers 
may file an Application for Temporary Employment Certification for H-2A 
workers as a sole employer, a joint employer, or agent. The association 
must identify in the Application for Temporary Employment Certification 
in what capacity it is filing. The association must retain documentation 
substantiating the employer or agency status of the association and be 
prepared to submit such documentation in response to a Notice of 
Deficiency from the CO prior to issuing a Final Determination, or in the 
event of an audit.
    (b) Master applications. An association may file a master 
application on behalf of its employer-members. The master application is 
available only when the association is filing as a joint employer. An 
association may submit a master application covering the same occupation 
or comparable work available with a number of its employer-members in 
multiple areas of intended employment, just as though all of the covered 
employers were in fact a single employer, as long as a single date of 
need is provided for all workers requested by the Application for 
Temporary Employment Certification and all employer-members are located 
in no more than two contiguous States. The association must identify on 
the Application for Temporary Employment Certification by name, address, 
total number of workers needed, and the crops and agricultural work to 
be performed, each employer that will employ H-2A workers. The 
association, as appropriate, will receive a certified Application for 
Temporary Employment Certification that can be copied and sent to the 
United States Citizenship and Immigration Services (USCIS) with each 
employer-member's petition.



Sec.  655.132  H-2A labor contractor (H-2ALC) filing requirements.

    If an H-2ALC intends to file an Application for Temporary Employment 
Certification, the H-2ALC must meet all of the requirements of the 
definition of employer inSec. 655.103(b), and comply with all the 
assurances, guarantees, and other requirements contained in this part, 
including Assurances and Obligations of H-2A Employers, and in part 653, 
subpart F, of this chapter.
    (a) Scope of H-2ALC Applications. An Application for Temporary 
Employment Certification filed by an H-2ALC must be limited to a single 
area of intended employment in which the fixed-site employer(s) to whom 
an H-2ALC is furnishing employees will be utilizing the employees.
    (b) Required information and submissions. An H-2ALC must include in 
or with its Application for Temporary Employment Certification the 
following:
    (1) The name and location of each fixed-site agricultural business 
to which the H-2ALC expects to provide H-2A workers, the expected 
beginning and ending dates when the H-2ALC will be providing the workers 
to each fixed site, and a description of the crops and activities the 
workers are expected to perform at such fixed site.
    (2) A copy of the Migrant and Seasonal Agricultural Worker 
Protection Act (MSPA) Farm Labor Contractor (FLC) Certificate of 
Registration, if required under MSPA at 29 U.S.C. 1801 et seq., 
identifying the specific farm labor contracting activities the H-2ALC is 
authorized to perform as an FLC.
    (3) Proof of its ability to discharge financial obligations under 
the H-2A

[[Page 548]]

program by including with the Application for Temporary Employment 
Certification the original surety bond as required by 29 CFR 501.9. The 
bond document must clearly identify the issuer, the name, address, phone 
number, and contact person for the surety, and provide the amount of the 
bond (as calculated pursuant to 29 CFR 501.9) and any identifying 
designation used by the surety for the bond.
    (4) Copies of the fully-executed work contracts with each fixed-site 
agricultural business identified under paragraph (b)(1) of this section.
    (5) Where the fixed-site agricultural business will provide housing 
or transportation to the workers, proof that:
    (i) All housing used by workers and owned, operated or secured by 
the fixed-site agricultural business complies with the applicable 
standards as set forth inSec. 655.122(d) and certified by the SWA; and
    (ii) All transportation between the worksite and the workers' living 
quarters that is provided by the fixed-site agricultural business 
complies with all applicable Federal, State, or local laws and 
regulations and must provide, at a minimum, the same vehicle safety 
standards, driver licensure, and vehicle insurance as required under 29 
U.S.C. 1841 and 29 CFR 500.105 and 500.120 to 500.128, except where 
workers' compensation is used to cover such transportation as described 
inSec. 655.125(h).



Sec.  655.133  Requirements for agents.

    (a) An agent filing an Application for Temporary Employment 
Certification on behalf of an employer must provide a copy of the agent 
agreement or other document demonstrating the agent's authority to 
represent the employer.
    (b) In addition the agent must provide a copy of the MSPA FLC 
Certificate of Registration, if required under MSPA at 29 U.S.C. 1801 et 
seq., identifying the specific farm labor contracting activities the 
agent is authorized to perform.



Sec.  655.134  Emergency situations.

    (a) Waiver of time period. The CO may waive the time period for 
filing for employers who did not make use of temporary alien 
agricultural workers during the prior year's agricultural season or for 
any employer that has other good and substantial cause (which may 
include unforeseen changes in market conditions), provided that the CO 
has sufficient time to test the domestic labor market on an expedited 
basis to make the determinations required bySec. 655.100.
    (b) Employer requirements. The employer requesting a waiver of the 
required time period must concurrently submit to the NPC and to the SWA 
serving the area of intended employment a completed Application for 
Temporary Employment Certification, a completed job order on the Form 
ETA-790, and a statement justifying the request for a waiver of the time 
period requirement. The statement must indicate whether the waiver 
request is due to the fact that the employer did not use H-2A workers 
during the prior agricultural season or whether the request is for good 
and substantial cause. If the waiver is requested for good and 
substantial cause, the employer's statement must also include detailed 
information describing the good and substantial cause which has 
necessitated the waiver request. Good and substantial cause may include, 
but is not limited to, the substantial loss of U.S. workers due to 
weather-related activities or other reasons, unforeseen events affecting 
the work activities to be performed, pandemic health issues, or similar 
conditions.
    (c) Processing of emergency applications. The CO will process 
emergency Applications for Temporary Employment Certification in a 
manner consistent with the provisions set forth in Sec.Sec. 655.140 
through 655.145 and make a determination on the Application for 
Temporary Employment Certification in accordance with Sec.Sec. 655.160 
through 655.167. The CO may advise the employer in writing that the 
certification cannot be granted because, pursuant to paragraph (a) of 
this section, the request for emergency filing was not justified and/or 
there is not sufficient time to test the availability of U.S. workers 
such that the CO can make a determination on the Application for 
Temporary Employment Certification in accordance withSec. 655.161. 
Such notification will so inform the employer using

[[Page 549]]

the procedures applicable to a denial of certification set forth in 
Sec.  655.164.



Sec.  655.135  Assurances and obligations of H-2A employers.

    An employer seeking to employ H-2A workers must agree as part of the 
Application for Temporary Employment Certification and job offer that it 
will abide by the requirements of this subpart and make each of the 
following additional assurances:
    (a) Non-discriminatory hiring practices. The job opportunity is, and 
through the period set forth in paragraph (d) of this section must 
continue to be, open to any qualified U.S. worker regardless of race, 
color, national origin, age, sex, religion, handicap, or citizenship. 
Rejections of any U.S. workers who applied or apply for the job must be 
only for lawful, job-related reasons, and those not rejected on this 
basis have been or will be hired. In addition, the employer has and will 
continue to retain records of all hires and rejections as required by 
Sec.  655.167.
    (b) No strike or lockout. The worksite for which the employer is 
requesting H-2A certification does not currently have workers on strike 
or being locked out in the course of a labor dispute.
    (c) Recruitment requirements. The employer has and will continue to 
cooperate with the SWA by accepting referrals of all eligible U.S. 
workers who apply (or on whose behalf an Application for Temporary 
Employment Certification is made) for the job opportunity until the end 
of the period as specified in paragraph (d) of this section and must 
independently conduct the positive recruitment activities, as specified 
inSec. 655.154, until the date on which the H-2A workers depart for 
the place of work. Unless the SWA is informed in writing of a different 
date, the date that is the third day preceding the employer's first date 
of need will be determined to be the date the H-2A workers departed for 
the employer's place of business.
    (d) Fifty percent rule. From the time the foreign workers depart for 
the employer's place of employment, the employer must provide employment 
to any qualified, eligible U.S. worker who applies to the employer until 
50 percent of the period of the work contract has elapsed. Start of the 
work contract timeline is calculated from the first date of need stated 
on the Application for Temporary Employment Certification, under which 
the foreign worker who is in the job was hired. This provision will not 
apply to any employer who certifies to the CO in the Application for 
Temporary Employment Certification that the employer:
    (1) Did not, during any calendar quarter during the preceding 
calendar year, use more than 500 man-days of agricultural labor, as 
defined in sec. 203(u) of Title 29;
    (2) Is not a member of an association which has petitioned for 
certification under this subpart for its members; and
    (3) Has not otherwise associated with other employers who are 
petitioning for temporary foreign workers under this subpart.
    (e) Compliance with applicable laws. During the period of employment 
that is the subject of the Application for Temporary Employment 
Certification, the employer must comply with all applicable Federal, 
State and local laws and regulations, including health and safety laws. 
In compliance with such laws, including the William Wilberforce 
Trafficking Victims Protection Reauthorization Act of 2008, Pub. L. 110-
457, 18 U.S.C. 1592(a), the employer may not hold or confiscate workers' 
passports, visas, or other immigration documents. H-2A employers may 
also be subject to the FLSA. The FLSA operates independently of the H-2A 
program and has specific requirements that address payment of wages, 
including deductions from wages, the payment of Federal minimum wage and 
payment of overtime.
    (f) Job opportunity is full-time. The job opportunity is a full-time 
temporary position, calculated to be at least 35 hours per work week.
    (g) No recent or future layoffs. The employer has not laid off and 
will not lay off any similarly employed U.S. worker in the occupation 
that is the subject of the Application for Temporary Employment 
Certification in the area of intended employment except for lawful, job-
related reasons within 60 days of the date of need, or if the employer 
has laid off such workers, it has offered the job opportunity that is 
the subject of

[[Page 550]]

the Application for Temporary Employment Certification to those laid-off 
U.S. worker(s) and the U.S. worker(s) refused the job opportunity, was 
rejected for the job opportunity for lawful, job-related reasons, or was 
hired. A layoff for lawful, job-related reasons such as lack of work or 
the end of the growing season is permissible if all H-2A workers are 
laid off before any U.S. worker in corresponding employment.
    (h) No unfair treatment. The employer has not and will not 
intimidate, threaten, restrain, coerce, blacklist, discharge or in any 
manner discriminate against, and has not and will not cause any person 
to intimidate, threaten, restrain, coerce, blacklist, or in any manner 
discriminate against, any person who has:
    (1) Filed a complaint under or related to 8 U.S.C. 1188, or this 
subpart or any other Department regulation promulgated thereunder;
    (2) Instituted or caused to be instituted any proceeding under or 
related to 8 U.S.C. 1188 or this subpart or any other Department 
regulation promulgated thereunder;
    (3) Testified or is about to testify in any proceeding under or 
related to 8 U.S.C. 1188 or this subpart or any other Department 
regulation promulgated thereunder;
    (4) Consulted with an employee of a legal assistance program or an 
attorney on matters related to 8 U.S.C. 1188 or this subpart or any 
other Department regulation promulgated thereunder; or
    (5) Exercised or asserted on behalf of himself/herself or others any 
right or protection afforded by 8 U.S.C. 1188 or this subpart or any 
other Department regulation promulgated thereunder.
    (i) Notify workers of duty to leave United States. (1) The employer 
must inform H-2A workers of the requirement that they leave the U.S. at 
the end of the period certified by the Department or separation from the 
employer, whichever is earlier, as required under paragraph (i)(2) of 
this section, unless the H-2A worker is being sponsored by another 
subsequent H-2A employer.
    (2) As defined further in DHS regulations, a temporary labor 
certification limits the validity period of an H-2A petition, and 
therefore, the authorized period of stay for an H-2A worker. See 8 CFR 
214.2(h)(5)(vii) A foreign worker may not remain beyond his or her 
authorized period of stay, as determined by DHS, nor beyond separation 
from employment prior to completion of the H-2A contract, absent an 
extension or change of such worker's status under DHS regulations. See 8 
CFR 214.2(h)(5)(viii)(B).
    (j) Comply with the prohibition against employees paying fees. The 
employer and its agents have not sought or received payment of any kind 
from any employee subject to 8 U.S.C. 1188 for any activity related to 
obtaining H-2A labor certification, including payment of the employer's 
attorneys' fees, application fees, or recruitment costs. For purposes of 
this paragraph, payment includes, but is not limited to, monetary 
payments, wage concessions (including deductions from wages, salary, or 
benefits), kickbacks, bribes, tributes, in kind payments, and free 
labor. This provision does not prohibit employers or their agents from 
receiving reimbursement for costs that are the responsibility and 
primarily for the benefit of the worker, such as government-required 
passport fees.
    (k) Contracts with third parties comply with prohibitions. The 
employer has contractually forbidden any foreign labor contractor or 
recruiter (or any agent of such foreign labor contractor or recruiter) 
whom the employer engages, either directly or indirectly, in 
international recruitment of H-2A workers to seek or receive payments or 
other compensation from prospective employees. This documentation is to 
be made available upon request by the CO or another Federal party.
    (l) Notice of worker rights. The employer must post and maintain in 
a conspicuous location at the place of employment, a poster provided by 
the Secretary in English, and, to the extent necessary, any language 
common to a significant portion of the workers if they are not fluent in 
English, which sets out the rights and protections for workers employed 
pursuant to 8 U.S.C. 1188.

[[Page 551]]

    Processing of Applications for Temporary Employment Certification



Sec.  655.140  Review of applications.

    (a) NPC review. The CO will promptly review the Application for 
Temporary Employment Certification and job order for compliance with all 
applicable program requirements, including compliance with the 
requirements set forth in this subpart.
    (b) Mailing and postmark requirements. Any notice or request sent by 
the CO(s) to an employer requiring a response will be sent using the 
provided address via traditional methods to assure next day delivery. 
The employer's response to such a notice or request must be filed using 
traditional methods to assure next day delivery and be sent by the date 
due or the next business day if the due date falls on a Sunday or 
Federal Holiday.



Sec.  655.141  Notice of deficiency.

    (a) Notification timeline. If the CO determines the Application for 
Temporary Employment Certification or job order are incomplete, contain 
errors or inaccuracies, or do not meet the requirements set forth in 
this subpart, the CO will notify the employer within 7 calendar days of 
the CO's receipt of the Application for Temporary Employment 
Certification. A copy of this notification will be sent to the SWA 
serving the area of intended employment.
    (b) Notice content. The notice will:
    (1) State the reason(s) why the Application for Temporary Employment 
Certification or job order fails to meet the criteria for acceptance;
    (2) Offer the employer an opportunity to submit a modified 
Application for Temporary Employment Certification or job order within 5 
business days from date of receipt stating the modification that is 
needed for the CO to issue the Notice of Acceptance;
    (3) Except as provided for under the expedited review or de novo 
administrative hearing provisions of this section, state that the CO's 
determination on whether to grant or deny the Application for Temporary 
Employment Certification will be made no later than 30 calendar days 
before the date of need, provided that the employer submits the 
requested modification to the Application for Temporary Employment 
Certification within 5 business days and in a manner specified by the 
CO;
    (4) Offer the employer an opportunity to request an expedited 
administrative review or a de novo administrative hearing before an ALJ 
of the Notice of Deficiency. The notice will state that in order to 
obtain such a review or hearing, the employer, within 5 business days of 
the receipt of the notice, must file by facsimile or other means 
normally assuring next day delivery a written request to the Chief ALJ 
of DOL and simultaneously serve a copy on the CO. The notice will also 
state that the employer may submit any legal arguments that the employer 
believes will rebut the basis of the CO's action; and
    (5) State that if the employer does not comply with the requirements 
ofSec. 655.142 or request an expedited administrative review or a de 
novo hearing before an ALJ within 5 business days the CO will deny the 
Application for Temporary Employment Certification. That denial is final 
cannot be appealed and the Department will not further consider that 
Application for Temporary Employment Certification.
    (c) Appeal from Notice of Deficiency. The employer may timely 
request an expedited administrative review or de novo hearing before an 
ALJ by following the procedures set forth inSec. 655.171.



Sec.  655.142  Submission of modified applications.

    (a) Submission requirements and certification delays. If the 
employer chooses to submit a modified Application for Temporary 
Employment Certification, the CO's Final Determination will be postponed 
by 1 calendar day for each day that passes beyond the 5 business-day 
period allowed underSec. 655.141(b) to submit a modified Application 
for Temporary Employment Certification, up to maximum of 5 days. The 
Application for Temporary Employment Certification will be deemed 
abandoned if the employer does not submit a modified Application for 
Temporary Employment Certification within 12 calendar days after the 
notice of deficiency was issued.

[[Page 552]]

    (b) Provisions for denial of modified Application for Temporary 
Employment Certification. If the modified Application for Temporary 
Employment Certification is not approved, the CO will deny the 
Application for Temporary Employment Certification in accordance with 
the labor certification determination provisions inSec. 655.164.
    (c) Appeal from denial of modified Application for Temporary 
Employment Certification. The procedures for appealing a denial of a 
modified Application for Temporary Employment Certification are the same 
as for a non-modified Application for Temporary Employment Certification 
as long as the employer timely requests an expedited administrative 
review or de novo hearing before an ALJ by following the procedures set 
forth inSec. 655.171.



Sec.  655.143  Notice of acceptance.

    (a) Notification timeline. When the CO determines the Application 
for Temporary Employment Certification and job order are complete and 
meet the requirements set forth in this subpart, the CO will notify the 
employer within 7 calendar days of the CO's receipt of the Application 
for Temporary Employment Certification. A copy will be sent to the SWA 
serving the area of intended employment.
    (b) Notice content. The notice must:
    (1) Authorize conditional access to the interstate clearance system 
and direct the SWA to circulate a copy of the job order to other such 
States the CO determines to be potential sources of U.S. workers;
    (2) Direct the employer to engage in positive recruitment of U.S. 
workers in a manner consistent withSec. 655.154 and to submit a report 
of its positive recruitment efforts as specified inSec. 655.156;
    (3) State that positive recruitment is in addition to and will occur 
during the period of time that the job order is being circulated by the 
SWA(s) for interstate clearance underSec. 655.150 of this subpart and 
will terminate on the actual date on which the H-2A workers depart for 
the place of work, or 3 calendar days prior to the first date the 
employer requires the services of the H-2A workers, whichever occurs 
first; and
    (4) State that the CO will make a determination either to grant or 
deny the Application for Temporary Employment Certification no later 
than 30 calendar days before the date of need, except as provided for 
underSec. 655.144 for modified Applications for Temporary Employment 
Certification.



Sec.  655.144  Electronic job registry.

    (a) Location of and placement in the electronic job registry. Upon 
acceptance of the Application for Temporary Employment Certification 
underSec. 655.143, the CO will promptly place for public examination a 
copy of the job order on an electronic job registry maintained by the 
Department, including any required modifications approved by the CO, as 
specified inSec. 655.142. This procedure will be implemented once the 
Department initiates operation of the registry.
    (b) Length of posting on electronic job registry. Unless otherwise 
provided, the Department will keep the job order posted on the 
Electronic Job Registry until the end of 50 percent of the contract 
period as set forth inSec. 655.135(d).



Sec.  655.145  Amendments to applications for temporary employment
certification.

    (a) Increases in number of workers. The Application for Temporary 
Employment Certification may be amended at any time before the CO's 
certification determination to increase the number of workers requested 
in the initial Application for Temporary Employment Certification by not 
more than 20 percent (50 percent for employers requesting less than 10 
workers) without requiring an additional recruitment period for U.S. 
workers. Requests for increases above the percent prescribed, without 
additional recruitment, may be approved by the CO only when the employer 
demonstrates that the need for additional workers could not have been 
foreseen, and the crops or commodities will be in jeopardy prior to the 
expiration of an additional recruitment period. All requests for 
increasing the number of workers must be made in writing.
    (b) Minor changes to the period of employment. The Application for 
Temporary

[[Page 553]]

Employment Certification may be amended to make minor changes in the 
total period of employment. Changes will not be effective until 
submitted in writing and approved by the CO. In considering whether to 
approve the request, the CO will review the reason(s) for the request, 
determine whether the reason(s) are on the whole justified, and take 
into account the effect any change(s) would have on the adequacy of the 
underlying test of the domestic labor market for the job opportunity. An 
employer must demonstrate that the change to the period of employment 
could not have been foreseen, and the crops or commodities will be in 
jeopardy prior to the expiration of an additional recruitment period. If 
the request is for a delay in the start date and is made after workers 
have departed for the employer's place of work, the CO may only approve 
the change if the employer includes with the request a written assurance 
signed and dated by the employer that all workers who are already 
traveling to the job site will be provided housing and subsistence, 
without cost to the workers, until work commences. Upon acceptance of an 
amendment, the CO will submit to the SWA any necessary modification to 
the job order.

                      Post-Acceptance Requirements



Sec.  655.150  Interstate clearance of job order.

    (a) SWA posts in interstate clearance system. The SWA must promptly 
place the job order in interstate clearance to all States designated by 
the CO. At a minimum, the CO will instruct the SWA to transmit a copy of 
its active job order to all States listed in the job order as 
anticipated worksites covering the area of intended employment.
    (b) Duration of posting. Each of the SWAs to which the job order was 
transmitted must keep the job order on its active file until 50 percent 
of the contract term has elapsed, and must refer each qualified U.S. 
worker who applies (or on whose behalf an application is made) for the 
job opportunity.



Sec.  655.151  Newspaper advertisements.

    (a) The employer must place an advertisement (in a language other 
than English, where the CO determines appropriate) on 2 separate days, 
which may be consecutive, one of which must be a Sunday (except as 
provided in paragraph (b) of this section), in a newspaper of general 
circulation serving the area of intended employment and is appropriate 
to the occupation and the workers likely to apply for the job 
opportunity. Newspaper advertisements must satisfy the requirements set 
forth inSec. 655.152.
    (b) If the job opportunity is located in a rural area that does not 
have a newspaper with a Sunday edition, the CO may direct the employer, 
in place of a Sunday edition, to advertise in the regularly published 
daily edition with the widest circulation in the area of intended 
employment.



Sec.  655.152  Advertising requirements.

    All advertising conducted to satisfy the required recruitment 
activities underSec. 655.151 must meet the requirements set forth in 
this section and must contain terms and conditions of employment which 
are not less favorable than those offered to the H-2A workers. All 
advertising must contain the following information:
    (a) The employer's name, or in the event that a master application 
will be filed by an association, a statement indicating that the name 
and location of each member of the association can be obtained from the 
SWA of the State in which the advertisement is run;
    (b) The geographic area of intended employment with enough 
specificity to apprise applicants of any travel requirements and where 
applicants will likely have to reside to perform the services or labor;
    (c) A description of the job opportunity for which certification is 
sought with sufficient information to apprise U.S. workers of services 
or labor to be performed and the anticipated start and end dates of 
employment of the job opportunity;
    (d) The wage offer, or in the event that there are multiple wage 
offers (such as where a master application will be filed by an 
association and/or where there are multiple crop activities for a single 
employer), the range of applicable wage offers and, where a master 
application will be filed by an

[[Page 554]]

association, a statement indicating that the rate(s) applicable to each 
employer can be obtained from the SWA of the State in which the 
advertisement is run;
    (e) The three-fourths guarantee specified inSec. 655.122(i);
    (f) If applicable, a statement that work tools, supplies, and 
equipment will be provided at no cost to the worker;
    (g) A statement that housing will be made available at no cost to 
workers, including U.S. workers who cannot reasonably return to their 
permanent residence at the end of each working day;
    (h) A statement that transportation and subsistence expenses to the 
worksite will be provided by the employer or paid by the employer upon 
completion of 50 percent of the work contract, or earlier, if 
appropriate;
    (i) A statement that the position is temporary and a specification 
of the total number of job openings the employer intends to fill;
    (j) A statement directing applicants to apply for the job 
opportunity at the nearest office of the SWA in the State in which the 
advertisement appeared. Employers who wish to require interviews must 
conduct those interviews by phone or provide a procedure for the 
interviews to be conducted in the location where the worker is being 
recruited at little or no cost to the worker. Employers cannot provide 
potential H-2A workers more favorable treatment with respect to the 
requirement and conduct of interviews; and
    (k) Contact information for the applicable SWA and, if available, 
the job order number.



Sec.  655.153  Contact with former U.S. employees.

    The employer must contact, by mail or other effective means, its 
former U.S. workers (except those who were dismissed for cause or who 
abandoned the worksite) employed by the employer in the occupation at 
the place of employment during the previous year and solicit their 
return to the job. This contact must occur during the period of time 
that the job order is being circulated by the SWA(s) for interstate 
clearance and documentation sufficient to prove contact must be 
maintained in the event of an audit.



Sec.  655.154  Additional positive recruitment.

    (a) Where to conduct additional positive recruitment. The employer 
must conduct positive recruitment within a multistate region of 
traditional or expected labor supply where the CO finds that there are a 
significant number of qualified U.S. workers who, if recruited, would be 
willing to make themselves available for work at the time and place 
needed.
    (b) Additional requirements should be comparable to non-H-2A 
employers in the area. The CO will ensure that the effort, including the 
location(s) and method(s) of the positive recruitment required of the 
potential H-2A employer must be no less than the normal recruitment 
efforts of non-H-2A agricultural employers of comparable or smaller size 
in the area of intended employment, and the kind and degree of 
recruitment efforts which the potential H-2A employer made to obtain 
foreign workers.
    (c) Nature of the additional positive recruitment. The CO will 
describe the precise nature of the additional positive recruitment but 
the employer will not be required to conduct positive recruitment in 
more than three States for each area of intended employment listed on 
the employer's application.
    (d) Proof of recruitment. The CO will specify the documentation or 
other supporting evidence that must be maintained by the employer as 
proof that the positive recruitment requirements were met.



Sec.  655.155  Referrals of U.S. workers.

    SWAs may only refer for employment individuals who have been 
apprised of all the material terms and conditions of employment and have 
indicated, by accepting referral to the job opportunity, that he or she 
is qualified, able, willing, and available for employment.



Sec.  655.156  Recruitment report.

    (a) Requirements of a recruitment report. The employer must prepare, 
sign, and date a written recruitment report. The recruitment report must 
be submitted on a date specified by the CO in

[[Page 555]]

the Notice of Acceptance set forth inSec. 655.141 and contain the 
following information:
    (1) Identify the name of each recruitment source;
    (2) State the name and contact information of each U.S. worker who 
applied or was referred to the job opportunity up to the date of the 
preparation of the recruitment report, and the disposition of each 
worker;
    (3) Confirm that former U.S. employees were contacted and by what 
means; and
    (4) If applicable, for each U.S. worker who applied for the position 
but was not hired, explain the lawful job-related reason(s) for not 
hiring the U.S. worker.
    (b) Duty to update recruitment report. The employer must continue to 
maintain the recruitment report throughout the recruitment period 
including the 50 percent period. The updated report is not to be 
automatically submitted to the Department, but must be made available in 
the event of a post-certification audit or upon request by authorized 
representatives of the Secretary.



Sec.  655.157  Withholding of U.S. workers prohibited.

    (a) Filing a complaint. Any employer who has reason to believe that 
a person or entity has willfully and knowingly withheld U.S. workers 
prior to the arrival at the worksite of H-2A workers in order to force 
the hiring of U.S. workers during the recruitment period, as set forth 
inSec. 655.135(d), may submit a written complaint to the CO. The 
complaint must clearly identify the person or entity who the employer 
believes has withheld the U.S. workers, and must specify sufficient 
facts to support the allegation (e.g., dates, places, numbers and names 
of U.S. workers) which will permit an investigation to be conducted by 
the CO.
    (b) Duty to investigate. Upon receipt, the CO must immediately 
investigate the complaint. The investigation must include interviews 
with the employer who has submitted the complaint, the person or entity 
named as responsible for withholding the U.S. workers, and the 
individual U.S. workers whose availability has purportedly been 
withheld.
    (c) Duty to suspend the recruitment period. Where the CO determines, 
after conducting the interviews required by paragraph (b) of this 
section, that the employer's complaint is valid and justified, the CO 
will immediately suspend the application of the 50 percent rule of the 
recruitment period, as set forth inSec. 655.135(d), to the employer. 
The CO's determination is the final decision of the Secretary.



Sec.  655.158  Duration of positive recruitment.

    Except as otherwise noted, the obligation to engage in positive 
recruitment described in Sec.Sec. 655.150 through 655.154 shall 
terminate on the date H-2A workers depart for the employer's place of 
work. Unless the SWA is informed in writing of a different date, the 
date that is the third day preceding the employer's first date of need 
will be determined to be the date the H-2A workers departed for the 
employer's place of business.

                   Labor Certification Determinations



Sec.  655.160  Determinations.

    Except as otherwise noted in this section, the CO will make a 
determination either to grant or deny the Application for Temporary 
Employment Certification no later than 30 calendar days before the date 
of need identified in the Application for Temporary Employment 
Certification. An Application for Temporary Employment Certification 
that is modified underSec. 655.142 or that otherwise does not meet the 
requirements for certification in this subpart is not subject to the 30-
day timeframe for certification.



Sec.  655.161  Criteria for certification.

    (a) The criteria for certification include whether the employer has 
established the need for the agricultural services or labor to be 
performed on a temporary or seasonal basis; complied with the 
requirements of parts 653 and 654 of this chapter; complied with all of 
this subpart, including but not limited to the timeliness requirements 
inSec. 655.130(b); complied with the offered wage rate criteria in 
Sec.  655.120; made all the assurances inSec. 655.135; and met all

[[Page 556]]

the recruitment obligations required bySec. 655.121 andSec. 655.152.
    (b) In making a determination as to whether there are insufficient 
U.S. workers to fill the employer's job opportunity, the CO will count 
as available any U.S. worker referred by the SWA or any U.S. worker who 
applied (or on whose behalf an application is made) directly to the 
employer, but who was rejected by the employer for other than a lawful 
job-related reason or who has not been provided with a lawful job-
related reason for rejection by the employer.



Sec.  655.162  Approved certification.

    If temporary labor certification is granted, the CO will send the 
certified Application for Temporary Employment Certification and a Final 
Determination letter to the employer by means normally assuring next-day 
delivery and a copy, if appropriate, to the employer's agent or 
attorney.



Sec.  655.163  Certification fee.

    A determination by the CO to grant an Application for Temporary 
Employment Certification in whole or in part will include a bill for the 
required certification fees. Each employer of H-2A workers under the 
Application for Temporary Employment Certification (except joint 
employer associations, which may not be assessed a fee in addition to 
the fees assessed to the members of the association) must pay in a 
timely manner a non-refundable fee upon issuance of the certification 
granting the Application for Temporary Employment Certification (in 
whole or in part), as follows:
    (a) Amount. The Application for Temporary Employment Certification 
fee for each employer receiving a temporary agricultural labor 
certification is $100 plus $10 for each H-2A worker certified under the 
Application for Temporary Employment Certification, provided that the 
fee to an employer for each temporary agricultural labor certification 
received will be no greater than $1,000. There is no additional fee to 
the association filing the Application for Temporary Employment 
Certification. The fees must be paid by check or money order made 
payable to United States Department of Labor. In the case of an 
agricultural association acting as a joint employer applying on behalf 
of its H-2A employer members, the aggregate fees for all employers of H-
2A workers under the Application for Temporary Employment Certification 
must be paid by one check or money order.
    (b) Timeliness. Fees must be received by the CO no more than 30 days 
after the date of the certification. Non-payment or untimely payment may 
be considered a substantial violation subject to the procedures inSec. 
655.182.



Sec.  655.164  Denied certification.

    If temporary labor certification is denied, the Final Determination 
letter will be sent to the employer by means normally assuring next-day 
delivery and a copy, if appropriate, to the employer's agent or 
attorney. The Final Determination Letter will:
    (a) State the reason(s) certification is denied;
    (b) Offer the applicant an opportunity to request an expedited 
administrative review, or a de novo administrative hearing before an 
ALJ, of the denial. The notice must state that in order to obtain such a 
review or hearing, the employer, within 7 calendar days of the date of 
the notice, must file by facsimile (fax), or other means normally 
assuring next day delivery, a written request to the Chief ALJ of DOL 
(giving the address) and simultaneously serve a copy on the CO. The 
notice will also state that the employer may submit any legal arguments 
which the employer believes will rebut the basis of the CO's action; and
    (c) State that if the employer does not request an expedited 
administrative judicial review or a de novo hearing before an ALJ within 
the 7 calendar days, the denial is final and the Department will not 
further consider that Application for Temporary Employment 
Certification.



Sec.  655.165  Partial certification.

    The CO may issue a partial certification, reducing either the period 
of need or the number of H-2A workers being requested or both for 
certification, based upon information the CO receives during the course 
of processing the Application for Temporary Employment Certification, an 
audit, or

[[Page 557]]

otherwise. The number of workers certified will be reduced by one for 
each referred U.S. worker who is able, willing, and qualified, and who 
will be available at the time and place needed and has not been rejected 
for lawful job-related reasons, to perform the services or labor. If a 
partial labor certification is issued, the Final Determination letter 
will:
    (a) State the reason(s) why either the period of need and/or the 
number of H-2A workers requested has been reduced;
    (b) Offer the applicant an opportunity to request an expedited 
administrative review, or a de novo administrative hearing before an 
ALJ, of the decision. The notice will state that in order to obtain such 
a review or hearing, the employer, within 7 calendar days of the date of 
the notice, will file by facsimile or other means normally assuring next 
day delivery a written request to the Chief ALJ of DOL (giving the 
address) and simultaneously serve a copy on the CO. The notice will also 
state that the employer may submit any legal arguments which the 
employer believes will rebut the basis of the CO's action; and
    (c) State that if the employer does not request an expedited 
administrative judicial review or a de novo hearing before an ALJ within 
the 7 calendar days, the partial certification is final and the 
Department will not further consider that Application for Temporary 
Employment Certification.



Sec.  655.166  Requests for determinations based on nonavailability 
of U.S. workers.

    (a) Standards for requests. If a temporary labor certification has 
been partially granted or denied based on the CO's determination that 
able, willing, available, eligible, and qualified U.S. workers are 
available, and, on or after 30 calendar days before the date of need, 
some or all of those U.S. workers are, in fact, no longer able, willing, 
eligible, qualified, or available, the employer may request a new 
temporary labor certification determination from the CO. Prior to making 
a new determination the CO will promptly ascertain (which may be through 
the SWA or other sources of information on U.S. worker availability) 
whether specific able, willing, eligible and qualified replacement U.S. 
workers are available or can be reasonably expected to be present at the 
employer's establishment within 72 hours from the date the employer's 
request was received. The CO will expeditiously, but in no case later 
than 72 hours after the time a complete request (including the signed 
statement included in paragraph (b) of this section) is received, make a 
determination on the request. An employer may appeal a denial of such a 
determination in accordance with the procedures contained inSec. 
655.171.
    (b) Unavailability of U.S. workers. The employer's request for a new 
determination must be made directly to the CO by telephone or electronic 
mail, and must be confirmed by the employer in writing as required by 
this paragraph. If the employer telephonically or via electronic mail 
requests the new determination by asserting solely that U.S. workers 
have become unavailable, the employer must submit to the CO a signed 
statement confirming such assertion. If such signed statement is not 
received by the CO within 72 hours of the CO's receipt of the request 
for a new determination, the CO will deny the request.
    (c) Notification of determination. If the CO determines that U.S. 
workers have become unavailable and cannot identify sufficient available 
U.S. workers who are able, willing, eligible, and qualified or who are 
likely to become available, the CO will grant the employer's request for 
a new determination. However, this does not preclude an employer from 
submitting subsequent requests for new determinations, if warranted, 
based on subsequent facts concerning purported nonavailability of U.S. 
workers or referred workers not being eligible workers or not able, 
willing, or qualified because of lawful job-related reasons.



Sec.  655.167  Document retention requirements.

    (a) Entities required to retain documents. All employers filing an 
Application for Temporary Employment Certification requesting H-2A 
agricultural workers under this subpart are required to retain the 
documents and

[[Page 558]]

records proving compliance with this subpart.
    (b) Period of required retention. Records and documents must be 
retained for a period of 3 years from the date of certification of the 
Application for Temporary Employment Certification or from the date of 
determination if the Application for Temporary Employment Certification 
is denied or withdrawn.
    (c) Documents and records to be retained by all applicants. (1) 
Proof of recruitment efforts, including:
    (i) Job order placement as specified inSec. 655.121;
    (ii) Advertising as specified inSec. 655.152, or, if used, 
professional, trade, or ethnic publications;
    (iii) Contact with former U.S. workers as specified inSec. 
655.153; or
    (iv) Additional positive recruitment efforts (as specified inSec. 
655.154).
    (2) Substantiation of information submitted in the recruitment 
report prepared in accordance withSec. 655.156, such as evidence of 
nonapplicability of contact of former employees as specified inSec. 
655.153.
    (3) The final recruitment report and any supporting resumes and 
contact information as specified inSec. 655.156(b).
    (4) Proof of workers' compensation insurance or State law coverage 
as specified inSec. 655.122(e).
    (5) Records of each worker's earnings as specified inSec. 
655.122(j).
    (6) The work contract or a copy of the Application for Temporary 
Employment Certification as defined in 29 CFR 501.10 and specified in 
Sec.  655.122(q).
    (d) Additional retention requirement for associations filing 
Application for Temporary Employment Certification. In addition to the 
documents specified in paragraph (c) above, Associations must retain 
documentation substantiating their status as an employer or agent, as 
specified inSec. 655.131.

                           Post Certification



Sec.  655.170  Extensions.

    An employer may apply for extensions of the period of employment in 
the following circumstances.
    (a) Short-term extension. Employers seeking extensions of 2 weeks or 
less of the certified Application for Temporary Employment Certification 
must apply directly to DHS for approval. If granted, the Application for 
Temporary Employment Certification will be deemed extended for such 
period as is approved by DHS.
    (b) Long-term extension. Employers seeking extensions of more than 2 
weeks may apply to the CO. Such requests must be related to weather 
conditions or other factors beyond the control of the employer (which 
may include unforeseen changes in market conditions). Such requests must 
be supported in writing, with documentation showing that the extension 
is needed and that the need could not have been reasonably foreseen by 
the employer. The CO will notify the employer of the decision in writing 
if time allows, or will otherwise notify the employer of the decision. 
The CO will not grant an extension where the total work contract period 
under that Application for Temporary Employment Certification and 
extensions would be 12 months or more, except in extraordinary 
circumstances. The employer may appeal a denial of a request for an 
extension by following the procedures inSec. 655.171.
    (c) Disclosure. The employer must provide to the workers a copy of 
any approved extension in accordance withSec. 655.122(q), as soon as 
practicable.



Sec.  655.171  Appeals.

    Where authorized in this subpart, employers may request an 
administrative review or de novo hearing before an ALJ of a decision by 
the CO. In such cases, the CO will send a copy of the OFLC 
administrative file to the Chief ALJ by means normally assuring next-day 
delivery. The Chief ALJ will immediately assign an ALJ (which may be a 
panel of such persons designated by the Chief ALJ from the Board of 
Alien Labor Certification Appeals (BALCA)).
    (a) Administrative review. Where the employer has requested 
administrative review, within 5 business days after receipt of the ETA 
administrative file the ALJ will, on the basis of the written record and 
after due consideration of any written submissions (which may not 
include new evidence) from the parties involved or amici curiae, either 
affirm, reverse, or modify the CO's decision, or remand to the CO for 
further

[[Page 559]]

action. The decision of the ALJ must specify the reasons for the action 
taken and must be immediately provided to the employer, the CO, the OFLC 
Administrator and DHS by means normally assuring next-day delivery. The 
ALJ's decision is the final decision of the Secretary.
    (b) De novo hearing--(1) Conduct of hearing. Where the employer has 
requested a de novo hearing the procedures in 29 CFR part 18 apply to 
such hearings, except that:
    (i) The appeal will not be considered to be a complaint to which an 
answer is required;
    (ii) The ALJ will ensure that the hearing is scheduled to take place 
within 5 business days after the ALJ's receipt of the OFLC 
administrative file, if the employer so requests, and will allow for the 
introduction of new evidence; and
    (iii) The ALJ's decision must be rendered within 10 calendar days 
after the hearing.
    (2) Decision. After a de novo hearing, the ALJ must affirm, reverse, 
or modify the CO's determination, or remand to the CO for further 
action. The decision of the ALJ must specify the reasons for the action 
taken and must be immediately provided to the employer, CO, OFLC 
Administrator and DHS by means normally assuring next-day delivery. The 
ALJ's decision is the final decision of the Secretary.



Sec.  655.172  Withdrawal of job order and application for temporary 
employment certification.

    (a) Employers may withdraw a job order from intrastate posting if 
the employer no longer plans to file an Application for Temporary 
Employment Certification. However, a withdrawal of a job order does not 
nullify existing obligations to those workers recruited in connection 
with the placement of a job order pursuant to this subpart or the filing 
of an Application for Temporary Employment Certification.
    (b) Employers may withdraw an Application for Temporary Employment 
Certification once it has been formally accepted by the NPC. However, 
the employer is still obligated to comply with the terms and conditions 
of employment contained in the Application for Temporary Employment 
Certification with respect to workers recruited in connection with that 
application.



Sec.  655.173  Setting meal charges; petition for higher meal charges.

    (a) Meal charges. Until a new amount is set under this paragraph, an 
employer may charge workers up to $10.64 for providing them with three 
meals per day. The maximum charge allowed by this paragraph (a) will be 
changed annually by the same percentage as the 12 month percentage 
change for the Consumer Price Index for all Urban Consumers for Food 
between December of the year just concluded and December of the year 
prior to that. The annual adjustments will be effective on the date of 
their publication by the OFLC Administrator as a Notice in the Federal 
Register. When a charge or deduction for the cost of meals would bring 
the employee's wage below the minimum wage set by the FLSA at 29 U.S.C. 
206 the charge or deduction must meet the requirements of 29 U.S.C. 
203(m) of the FLSA, including the recordkeeping requirements found at 29 
CFR 516.27.
    (b) Filing petitions for higher meal charges. The employer may file 
a petition with the CO to charge more than the applicable amount for 
meal charges if the employer justifies the charges and submits to the CO 
the documentation required by paragraph (b)(1) of this section.
    (1) Documentation submitted must include the cost of goods and 
services directly related to the preparation and serving of meals, the 
number of workers fed, the number of meals served and the number of days 
meals were provided. The cost of the following items may be included: 
Food; kitchen supplies other than food, such as lunch bags and soap; 
labor costs that have a direct relation to food service operations, such 
as wages of cooks and dining hall supervisors; fuel, water, electricity, 
and other utilities used for the food service operation; and other costs 
directly related to the food service operation. Charges for 
transportation, depreciation, overhead and similar charges may not be 
included. Receipts and other cost records for a representative pay 
period must be retained and

[[Page 560]]

must be available for inspection by the CO for a period of 1 year.
    (2) The employer may begin charging the higher rate upon receipt of 
a favorable decision from the CO unless the CO sets a later effective 
date in the decision.
    (c) Appeal rights. In the event the employer's petition for a higher 
meal charge is denied in whole or in part, the employer may appeal the 
denial. Appeals will be filed with the Chief ALJ, pursuant toSec. 
655.171.



Sec.  655.174  Public disclosure.

    The Department will maintain an electronic file accessible to the 
public with information on all employers applying for temporary 
agricultural labor certifications. The database will include such 
information as the number of workers requested, the date filed, the date 
decided, and the final disposition.

                           Integrity Measures



Sec.  655.180  Audit.

    The CO may conduct audits of applications for which certifications 
have been granted.
    (a) Discretion. The applications selected for audit will be chosen 
within the sole discretion of the CO.
    (b) Audit letter. Where an application is selected for audit, the CO 
will issue an audit letter to the employer and a copy, if appropriate, 
to the employer's agent or attorney. The audit letter will:
    (1) State the documentation that must be submitted by the employer;
    (2) Specify a date no more than 30 days from the date of the audit 
letter by which the required documentation must be received by the CO; 
and
    (3) Advise that failure to comply with the audit process may result 
in the revocation of the certification or program debarment.
    (c) Supplemental information request. During the course of the audit 
examination, the CO may request supplemental information and/or 
documentation from the employer in order to complete the audit.
    (d) Potential referrals. In addition to steps in this subpart, the 
CO may determine to provide the audit findings and underlying 
documentation to DHS or another appropriate enforcement agency. The CO 
will refer any findings that an employer discouraged an eligible U.S. 
worker from applying, or failed to hire, discharged, or otherwise 
discriminated against an eligible U.S. worker, to the Department of 
Justice, Civil Rights Division, Office of Special Counsel for Unfair 
Immigration Related Employment Practices.



Sec.  655.181  Revocation.

    (a) Basis for DOL revocation. The OFLC Administrator may revoke a 
temporary agricultural labor certification approved under this subpart, 
if the OFLC Administrator finds:
    (1) The issuance of the temporary agricultural labor certification 
was not justified due to fraud or misrepresentation in the application 
process;
    (2) The employer substantially violated a material term or condition 
of the approved temporary agricultural labor certification, as defined 
inSec. 655.182;
    (3) The employer failed to cooperate with a DOL investigation or 
with a DOL official performing an investigation, inspection, audit (as 
discussed inSec. 655.180), or law enforcement function under 8 U.S.C. 
1188, 29 CFR part 501, or this subpart; or
    (4) The employer failed to comply with one or more sanctions or 
remedies imposed by the WHD, or with one or more decisions or orders of 
the Secretary or a court order secured by the Secretary under 8 U.S.C. 
1188, 29 CFR part 501, or this subpart.
    (b) DOL procedures for revocation. (1) Notice of Revocation. If the 
OFLC Administrator makes a determination to revoke an employer's 
temporary labor certification, the OFLC Administrator will send to the 
employer (and its attorney or agent) a Notice of Revocation. The Notice 
will contain a detailed statement of the grounds for the revocation, and 
it will inform the employer of its right to submit rebuttal evidence or 
to appeal. If the employer does not file rebuttal evidence or an appeal 
within 14 days of the date of the Notice of Revocation, the Notice is 
the final agency action and will take effect immediately at the end of 
the 14-day period.

[[Page 561]]

    (2) Rebuttal. The employer may submit evidence to rebut the grounds 
stated in the Notice of Revocation within 14 calendar days of the date 
the Notice is issued. If rebuttal evidence is timely filed by the 
employer, the OFLC Administrator will inform the employer of the OFLC 
Administrator's final determination on the revocation within 14 calendar 
days of receiving the rebuttal evidence. If the OFLC Administrator 
determines that the certification should be revoked, the OFLC 
Administrator will inform the employer of its right to appeal according 
to the procedures ofSec. 655.171. The employer must file the appeal 
within 10 calendar days after the OFLC Administrator's final 
determination, or the OFLC Administrator's determination is the final 
agency action and will take effect immediately at the end of the 10-day 
period.
    (3) Appeal. An employer may appeal a Notice of Revocation, or a 
final determination of the OFLC Administrator after the review of 
rebuttal evidence, according to the appeal procedures ofSec. 655.171. 
The ALJ's decision is the final agency action.
    (4) Stay. The timely filing of rebuttal evidence or an 
administrative appeal will stay the revocation pending the outcome of 
those proceedings.
    (5) Decision. If the temporary agricultural labor certification is 
revoked, the OFLC Administrator will send a copy of the final agency 
action of the Secretary to DHS and the Department of State (DOS).
    (c) Employer's obligations in the event of revocation. If an 
employer's temporary agricultural labor certification is revoked 
pursuant to this section, the employer is responsible for:
    (1) Reimbursement of actual inbound transportation and subsistence 
expenses, as if the worker meets the requirements for payment under 
Sec.  655.122(h)(1);
    (2) The worker's outbound transportation expenses, as if the worker 
meets the requirements for payment underSec. 655.122(h)(2);
    (3) Payment to the worker of the amount due under the three-fourths 
guarantee as required bySec. 655.122(i); and
    (4) Any other wages, benefits, and working conditions due or owing 
to the worker under this subpart.



Sec.  655.182  Debarment.

    (a) Debarment of an employer. The OFLC Administrator may debar an 
employer or any successor in interest to that employer from receiving 
future labor certifications under this subpart, subject to the time 
limits set forth in paragraph (c) of this section, if the OFLC 
Administrator finds that the employer substantially violated a material 
term or condition of its temporary labor certification, with respect to 
H-2A workers, workers in corresponding employment, or U.S. workers 
improperly rejected for employment, or improperly laid off or displaced.
    (b) Debarment of an agent or attorney. The OFLC Administrator may 
debar an agent or attorney from participating in any action under 8 
U.S.C. 1188, this subpart, or 29 CFR part 501, if the OFLC Administrator 
finds that the agent or attorney participated in an employer's 
substantial violation. The OFLC Administrator may not issue future labor 
certifications under this subpart to any employer represented by a 
debarred agent or attorney, subject to the time limits set forth in 
paragraph (c) of this section.
    (c) Statute of limitations and period of debarment. (1) The OFLC 
Administrator must issue any Notice of Debarment no later than 2 years 
after the occurrence of the violation.
    (2) No employer, attorney, or agent may be debarred under this 
subpart for more than 3 years from the date of the final agency 
decision.
    (d) Definition of violation. For the purposes of this section, a 
violation includes:
    (1) One or more acts of commission or omission on the part of the 
employer or the employer's agent which involve:
    (i) Failure to pay or provide the required wages, benefits or 
working conditions to the employer's H-2A workers and/or workers in 
corresponding employment;
    (ii) Failure, except for lawful, job-related reasons, to offer 
employment to qualified U.S. workers who applied for the job opportunity 
for which certification was sought;

[[Page 562]]

    (iii) Failure to comply with the employer's obligations to recruit 
U.S. workers;
    (iv) Improper layoff or displacement of U.S. workers or workers in 
corresponding employment;
    (v) Failure to comply with one or more sanctions or remedies imposed 
by the WHD Administrator for violation(s) of contractual or other H-2A 
obligations, or with one or more decisions or orders of the Secretary or 
a court under 8 U.S.C. 1188, 29 CFR part 501, or this subpart;
    (vi) Impeding an investigation of an employer under 8 U.S.C. 1188 or 
29 CFR part 501, or an audit underSec. 655.180 of this subpart;
    (vii) Employing an H-2A worker outside the area of intended 
employment, in an activity/activities not listed in the job order or 
outside the validity period of employment of the job order, including 
any approved extension thereof;
    (viii) A violation of the requirements ofSec. 655.135(j) or (k);
    (ix) A violation of any of the provisions listed in 29 CFR 501.4(a); 
or
    (x) A single heinous act showing such flagrant disregard for the law 
that future compliance with program requirements cannot reasonably be 
expected;
    (2) The employer's failure to pay a necessary certification fee in a 
timely manner;
    (3) Fraud involving the Application for Temporary Employment 
Certification; or
    (4) A material misrepresentation of fact during the application 
process.
    (e) Determining whether a violation is substantial. In determining 
whether a violation is so substantial so as to merit debarment, the 
factors the OFLC Administrator may consider include, but are not limited 
to, the following:
    (1) Previous history of violation(s) of 8 U.S.C. 1188, 29 CFR part 
501, or this subpart;
    (2) The number of H-2A workers, workers in corresponding employment, 
or U.S. workers who were and/or are affected by the violation(s);
    (3) The gravity of the violation(s);
    (4) Efforts made in good faith to comply with 8 U.S.C. 1188, 29 CFR 
part 501, and this subpart;
    (5) Explanation from the person charged with the violation(s);
    (6) Commitment to future compliance, taking into account the public 
health, interest, or safety, and whether the person has previously 
violated 8 U.S.C. 1188;
    (7) The extent to which the violator achieved a financial gain due 
to the violation(s), or the potential financial loss or potential injury 
to the worker(s).
    (f) Debarment procedure--(1) Notice of Debarment. If the OFLC 
Administrator makes a determination to debar an employer, attorney, or 
agent, the OFLC Administrator will send the party a Notice of Debarment. 
The Notice will state the reason for the debarment finding, including a 
detailed explanation of the grounds for and the duration of the 
debarment, and it will inform the party subject to the Notice of its 
right to submit rebuttal evidence or to request a debarment hearing. If 
the party does not file rebuttal evidence or request a hearing within 30 
calendar days of the date of the Notice of Debarment, the Notice will be 
the final agency action and the debarment will take effect at the end of 
the 30-day period.
    (2) Rebuttal. The party who received the Notice of Debarment may 
choose to submit evidence to rebut the grounds stated in the Notice 
within 30 calendar days of the date the Notice is issued. If rebuttal 
evidence is timely filed, the OFLC Administrator will issue a final 
determination on the debarment within 30 days of receiving the rebuttal 
evidence. If the OFLC Administrator determines that the party should be 
debarred, the OFLC Administrator will inform the party of its right to 
request a debarment hearing according to the procedures ofSec. 
655.182(f)(3). The party must request a hearing within 30 calendar days 
after the date of the OFLC Administrator's final determination, or the 
OFLC Administrator's determination will be the final agency order and 
the debarment will take effect at the end of the 30-day period.
    (3) Hearing. The recipient of a Notice of Debarment may request a 
debarment hearing within 30 calendar days of the date of a Notice of 
Debarment or the date of a final determination of the OFLC Administrator 
after review of rebuttal evidence submitted pursuant toSec. 
655.182(f)(2). To obtain a debarment

[[Page 563]]

hearing, the debarred party must, within 30 days of the date of the 
Notice or the final determination, file a written request to the Chief 
Administrative Law Judge, United States Department of Labor, 800 K 
Street, NW., Suite 400-N, Washington, DC 20001-8002, and simultaneously 
serve a copy to the OFLC Administrator. The debarment will take effect 
30 days from the date the Notice of Debarment or final determination is 
issued, unless a request for review is properly filed within 30 days 
from the issuance of the Notice of Debarment or final determination. The 
timely filing of a request for a hearing stays the debarment pending the 
outcome of the hearing. Within 10 days of receipt of the request for a 
hearing, the OFLC Administrator will send a certified copy of the ETA 
case file to the Chief ALJ by means normally assuring next-day delivery. 
The Chief ALJ will immediately assign an ALJ to conduct the hearing. The 
procedures in 29 CFR part 18 apply to such hearings, except that the 
request for a hearing will not be considered to be a complaint to which 
an answer is required.
    (4) Decision. After the hearing, the ALJ must affirm, reverse, or 
modify the OFLC Administrator's determination. The ALJ will prepare the 
decision within 60 days after completion of the hearing and closing of 
the record. The ALJ's decision will be provided immediately to the 
parties to the debarment hearing by means normally assuring next-day 
delivery. The ALJ's decision is the final agency action, unless either 
party, within 30 calendar days of the ALJ's decision, seeks review of 
the decision with the Administrative Review Board (ARB).
    (5) Review by the ARB. (i) Any party wishing review of the decision 
of an ALJ must, within 30 days of the decision of the ALJ, petition the 
ARB to review the decision. Copies of the petition must be served on all 
parties and on the ALJ. The ARB will decide whether to accept the 
petition within 30 days of receipt. If the ARB declines to accept the 
petition, or if the ARB does not issue a notice accepting a petition 
within 30 days after the receipt of a timely filing of the petition, the 
decision of the ALJ will be deemed the final agency action. If a 
petition for review is accepted, the decision of the ALJ will be stayed 
unless and until the ARB issues an order affirming the decision. The ARB 
must serve notice of its decision to accept or not to accept the 
petition upon the ALJ and upon all parties to the proceeding.
    (ii) Upon receipt of the ARB's notice to accept the petition, the 
Office of Administrative Law Judges will promptly forward a copy of the 
complete hearing record to the ARB.
    (iii) Where the ARB has determined to review such decision and 
order, the ARB will notify each party of the issue(s) raised, the form 
in which submissions must be made (e.g., briefs or oral argument), and 
the time within which such presentation must be submitted.
    (6) ARB decision. The ARB's final decision must be issued within 90 
days from the notice granting the petition and served upon all parties 
and the ALJ. If the ARB fails to provide a decision within 90 days from 
the notice granting the petition, the ALJ's decision will be the final 
agency decision.
    (g) Concurrent debarment jurisdiction. OFLC and the WHD have 
concurrent jurisdiction to impose a debarment remedy under this section 
or under 29 CFR 501.20. When considering debarment, OFLC and the WHD may 
inform one another and may coordinate their activities. A specific 
violation for which debarment is imposed will be cited in a single 
debarment proceeding. Copies of final debarment decisions will be 
forwarded to DHS promptly.
    (h) Debarment involving members of associations. If the OFLC 
Administrator determines that an individual employer-member of a joint 
employer association has committed a substantial violation, the 
debarment determination will apply only to that member unless the OFLC 
Administrator determines that the association or another association 
member participated in the violation, in which case the debarment will 
be invoked against the association or other complicit association 
member(s) as well.
    (i) Debarment involving associations acting as joint employers. If 
the OFLC Administrator determines that an association acting as a joint 
employer

[[Page 564]]

with its members has committed a substantial violation, the debarment 
determination will apply only to the association, and will not be 
applied to any individual employer-member of the association. However, 
if the OFLC Administrator determines that the member participated in, 
had knowledge of, or had reason to know of the violation, the debarment 
may be invoked against the complicit association member as well. An 
association debarred from the H-2A temporary labor certification program 
will not be permitted to continue to file as a joint employer with its 
members during the period of the debarment.
    (j) Debarment involving associations acting as sole employers. If 
the OFLC Administrator determines that an association acting as a sole 
employer has committed a substantial violation, the debarment 
determination will apply only to the association and any successor in 
interest to the debarred association.



Sec.  655.183  Less than substantial violations.

    (a) Requirement of special procedures. If the OFLC Administrator 
determines that a less than substantial violation has occurred, but the 
OFLC Administrator has reason to believe that past actions on the part 
of the employer (or agent or attorney) may have had and may continue to 
have a chilling or otherwise negative effect on the recruitment, 
employment, and retention of U.S. workers, the OFLC Administrator may 
require the employer to conform to special procedures before and after 
the temporary labor certification determination. These special 
procedures may include special on-site positive recruitment and 
streamlined interviewing and referral techniques. The special procedures 
are designed to enhance U.S. worker recruitment and retention in the 
next year as a condition for receiving a temporary agricultural labor 
certification. Such requirements will be reasonable; will not require 
the employer to offer better wages, working conditions, and benefits 
than those specified inSec. 655.122; and will be no more than deemed 
necessary to assure employer compliance with the test of U.S. worker 
availability and adverse effect criteria of this subpart.
    (b) Notification of required special procedures. The OFLC 
Administrator will notify the employer (or agent or attorney) in writing 
of the special procedures that will be required in the coming year. The 
notification will state the reasons for the imposition of the 
requirements, state that the employer's agreement to accept the 
conditions will constitute inclusion of them as bona fide conditions and 
terms of a temporary agricultural labor certification, and will offer 
the employer an opportunity to request an administrative review or a de 
novo hearing before an ALJ. If an administrative review or de novo 
hearing is requested, the procedures prescribed inSec. 655.171 will 
apply.
    (c) Failure to comply with special procedures. If the OFLC 
Administrator determines that the employer has failed to comply with 
special procedures required pursuant to paragraph (a) of this section, 
the OFLC Administrator will send a written notice to the employer, 
stating that the employer's otherwise affirmative H-2A certification 
determination will be reduced by 25 percent of the total number of H-2A 
workers requested (which cannot be more than those requested in the 
previous year) for a period of 1 year. Notice of such a reduction in the 
number of workers requested will be conveyed to the employer by the OFLC 
Administrator in the OFLC Administrator's written certification 
determination. The notice will offer the employer an opportunity to 
request administrative review or a de novo hearing before an ALJ. If 
administrative review or a de novo hearing is requested, the procedures 
prescribed inSec. 655.171 will apply, provided that if the ALJ affirms 
the OFLC Administrator's determination that the employer has failed to 
comply with special procedures required by paragraph (a) of this 
section, the reduction in the number of workers requested will be 25 
percent of the total number of H-2A workers requested (which cannot be 
more than those requested in the previous year) for a period of 1 year.

[[Page 565]]



Sec.  655.184  Applications involving fraud or willful misrepresentation.

    (a) Referral for investigation. If the CO discovers possible fraud 
or willful misrepresentation involving an Application for Temporary 
Employment Certification, the CO may refer the matter to the DHS and the 
Department's Office of the Inspector General for investigation.
    (b) Sanctions. If the WHD, a court or the DHS determines that there 
was fraud or willful misrepresentation involving an Application for 
Temporary Employment Certification and certification has been granted, a 
finding under this paragraph will be cause to revoke the certification. 
The finding of fraud or willful misrepresentation may also constitute a 
debarrable violation underSec. 655.182.



Sec.  655.185  Job service complaint system; enforcement of work 
contracts.

    (a) Filing with DOL. Complaints arising under this subpart must be 
filed through the Job Service Complaint System, as described in 20 CFR 
part 658, subpart E. Complaints involving allegations of fraud or 
misrepresentation must be referred by the SWA to the CO for appropriate 
handling and resolution. Complaints that involve worker contracts must 
be referred by the SWA to the WHD for appropriate handling and 
resolution, as described in 29 CFR part 501. As part of this process, 
the WHD may report the results of its investigation to the OFLC 
Administrator for consideration of employer penalties or such other 
action as may be appropriate.
    (b) Filing with the Department of Justice. Complaints alleging that 
an employer discouraged an eligible U.S. worker from applying, failed to 
hire, discharged, or otherwise discriminated against an eligible U.S. 
worker, or discovered violations involving the same, will be referred to 
the U.S. Department of Justice, Civil Rights Division, Office of Special 
Counsel for Unfair Immigration Related Employment Practices (OSC), in 
addition to any activity, investigation, and/or enforcement action taken 
by ETA or a SWA. Likewise, if OSC becomes aware of a violation of the 
regulations in this subpart, it may provide such information to the 
appropriate SWA and the CO.



 Subpart C_Labor Certification Process for Logging Employment and Non-H	
                       2A Agricultural Employment

    Source: 74 FR 26002, May 29, 2009, unless otherwise noted.



Sec.  655.200  General description of this subpart and definition
of terms.

    (a) This subpart applies to applications for temporary alien 
agricultural labor certification filed before June 1, 1987, and to 
applications for temporary alien labor certification for logging 
employment.
    (b) An employer who desires to use foreign workers for temporary 
employment must file a temporary labor certification application 
including a job offer for U.S. workers with an appropriate State 
Workforce Agency. The employer should file an application a minimum of 
80 days before the estimated date of need for the workers. If filed 80 
days before need, sufficient time is allowed for the 60-day recruitment 
period required by the regulations and a determination by the OFLC 
Administrator as to the availability of U.S. workers 20 days before the 
date of need. Shortly after the application has been filed, the OFLC 
Administrator makes a determination as to whether or not the application 
has been filed in enough time to recruit U.S. workers and whether or not 
the job offer for U.S. workers offers wages and working conditions which 
will not adversely affect the wages and working conditions of similarly 
employed U.S. workers, as prescribed in the regulations in this subpart. 
If the application does not meet the regulatory wage and working 
condition standards, the OFLC Administrator shall deny the temporary 
labor certification application and offer the employer an 
administrative-judicial review of the denial by an Administrative Law 
Judge. If the application is not timely, the OFLC Administrator has 
discretion, as set forth in these regulations, to either deny the 
application or permit the process to proceed reasonably with the 
employer recruiting U.S. workers upon such terms as

[[Page 566]]

will accomplish the purposes of the INA and the DHS regulations. Where 
the application is timely and meets the regulatory standards, the State 
Workforce Agency, the employer, and the Department of Labor recruit U.S. 
workers for 60 days. At the end of the 60 days, the OFLC Administrator 
grants the temporary labor certification if the OFLC Administrator finds 
that (1) the employer has not offered foreign workers higher wages or 
better working conditions (or less restrictions) than that offered to 
U.S. workers, and (2) U.S. workers are not available for the employer's 
job opportunities. If the temporary labor certification is denied, the 
employer may seek an administrative-judicial review of the denial by an 
Administrative Law Judge as provided in these regulations. The 
Department of Labor thereafter advises the United States Citizenship and 
Immigration Services of the Department of Homeland Security (DHS) of 
approvals and denials of temporary labor certifications. The DHS may 
accept or reject this advice. 8 CFR 214.2(h)(3). The DHS makes the final 
decision as to whether or not to grant visas to the foreign workers. 8 
U.S.C. 1184(a).
    (c) Definitions for terms used in this subpart.
    Administrative Law Judge means an official who is authorized to 
conduct administrative hearings.
    Administrator, Office of Foreign Labor Certification (OFLC 
Administrator) means the primary official of the Office of Foreign Labor 
Certification or the OFLC Administrator's designee.
    Adverse effect rate means the wage rate which the OFLC Administrator 
has determined must be offered and paid to foreign and U.S. workers for 
a particular occupation and/or area so that the wages of similarly 
employed U.S. workers will not be adversely affected. The OFLC 
Administrator may determine that the prevailing wage rate in the area 
and/or occupation is the adverse effect rate, if the use (or non-use) of 
aliens has not depressed the wages of similarly employed U.S. workers. 
The OFLC Administrator may determine that a wage rate higher than the 
prevailing wage rate is the adverse effect rate if the OFLC 
Administrator determines that the use of aliens has depressed the wages 
of similarly employed U.S. workers.
    Agent means a legal person, such as an association of employers, 
which (1) is authorized to act as an agent of the employer for temporary 
labor certification purposes, and (2) which is not itself an employer, 
or a joint employer, as defined in this section.
    Area of intended employment means the area within normal commuting 
distance of the place (address) of intended employment. If the place of 
intended employment is within a Standard Metropolitan Statistical Area 
(SMSA), any place within the SMSA is deemed to be within normal 
commuting distance of the place of intended employment.
    Department of Homeland Security (DHS) through the United States 
Citizenship and Immigration Services (USCIS) makes the determination 
under the INA on whether or not to grant visa petitions to an alien 
seeking to perform temporary agricultural or logging work in the United 
States.
    Employer means a person, firm, corporation or other association or 
organization (1) which currently has a location within the United States 
to which U.S. workers may be referred for employment, and which proposes 
to employ a worker at a place within the United States and (2) which has 
an employer relationship with respect to employees under this subpart as 
indicated by the fact that it hires, pays, fires, supervises and 
otherwise controls the work of such employees. An association of 
employers shall be considered an employer if it has all of the indicia 
of an employer set forth in this definition. Such an association, 
however, shall be considered as a joint employer with the employer 
member if it shares with the employer member one or more of the 
definitional indicia.
    Employment and Training Administration (ETA) means the agency within 
the Department of Labor (DOL) which includes the Office of Foreign Labor 
(OFLC).
    Job opportunity means a job opening for temporary, full-time 
employment at a place in the United States to which U.S. workers can be 
referred.

[[Page 567]]

    Office of Foreign Labor Certification (OFLC) means the 
organizational component within the ETA that provides national 
leadership and policy guidance and develops regulations and procedures 
to carry out the responsibilities of the Secretary of Labor under the 
INA concerning alien workers seeking admission to the United States in 
order to work under the Immigration and Nationality Act, as amended.
    Secretary means the Secretary of Labor or the Secretary's designee.
    State Workforce Agency (SWA) means the State employment service 
agency.
    Temporary labor certification means the advice given by the 
Secretary of Labor to the United States Citizenship and Immigration 
Services (USCIS) of the Department of Homeland Security (DHS), pursuant 
to the regulations of that agency at 8 CFR 214.2(h)(3)(i), that (1) 
there are not sufficient U.S. workers who are qualified and available to 
perform the work and (2) the employment of the alien will not adversely 
affect the wages and working conditions of similarly employed U.S. 
workers.
    United States workers means any worker who, whether U.S. national, 
citizen or alien, is legally permitted to work permanently within the 
United States.



Sec.  655.201  Temporary labor certification applications.

    (a)(1) An employer who anticipates a labor shortage of workers for 
agricultural or logging employment may request a temporary labor 
certification for temporary foreign workers by filing, or by having an 
agent file, in duplicate, a temporary labor certification application, 
signed by the employer, with a SWA in the area of intended employment.
    (2) If the temporary labor certification application is filed by an 
agent, however, the agent may sign the application if the application is 
accompanied by a letter from each employer the agent represents, signed 
by the employer, which authorizes the agent to act on the employer's 
behalf and which states that the employer assumes full responsibility 
for the accuracy of the application, for all representations made by the 
agent on the employer's behalf, and for the fulfillment of all legal 
requirements arising under this subpart.
    (3) If an association of employers files the application, the 
association shall identify and submit documents to verify whether, in 
accordance with the definitions atSec. 655.200, it is: (i) The 
employer, (ii) a joint employer with its member employers, or (iii) the 
agent of its employer members.
    (b) Every temporary labor certification application shall include:
    (1) A copy of the job offer which will be used by the employer (or 
each employer) for the recruitment of both U.S. and foreign workers. The 
job offer for each employer shall state the number of workers needed by 
the employer, and shall be signed by the employer. The job offer shall 
comply with the requirements of Sec.Sec. 655.202 and 653.108 of this 
chapter;
    (2) The assurances required bySec. 655.203; and
    (3) The specific estimated date of need of workers.
    (c) The entire temporary labor certification application shall be 
filed with the SWA in duplicate and in sufficient time to allow the 
State agency to attempt to recruit U.S. workers locally and through the 
Employment Service intrastate and interstate clearance system for 60 
calendar days prior to the estimated date of need. Section 655.206 
requires the OFLC Administrator to grant or deny the temporary labor 
certification application by the end of the 60 calendar days, or 20 days 
from the estimated date of need, whichever is later. That section also 
requires the OFLC Administrator to offer employers an expedited 
administrative-judicial review in cases of denials of the temporary 
labor certification applications. Following an administrative-judicial 
review, the employer has a right to contest any denial before the DHS 
pursuant to 8 CFR 214.2(h)(3)(i). Finally, employers need time, after 
the temporary labor certification determination, to complete the process 
for bringing foreign workers into the United States, or to bring an 
appeal of a denial of an application for the labor certification. 
Therefore, employers should file their temporary labor certification 
applications at least 80 days

[[Page 568]]

before the estimated date of need specified in the application.
    (d) Applications may be amended at any time prior to OFLC 
Administrator determination to increase the number of workers requested 
in the original application for labor certification by not more than 15 
percent without requiring an additional recruitment period for U.S. 
workers. Requests for increases beyond 15 percent may be approved only 
when it is determined that, based on past experience, the need for 
additional workers could not be foreseen and that a critical need for 
the workers would exist prior to the expiration of an additional 
recruitment period.
    (e) If a temporary labor certification application, or any part 
thereof, does not satisfy the time requirements specified in paragraph 
(c) of this section, and if the exception in paragraph (d) of this 
section does not apply, the SWA shall immediately send both copies 
directly to the appropriate OFLC Administrator. The OFLC Administrator 
may then advise the employer and the DHS in writing that the temporary 
labor certification cannot be granted because, pursuant to the 
regulations at paragraph (c) of this section, there is not sufficient 
time to test the availability of U.S. workers. The notice of denial to 
the employer shall inform the employer of the right to administrative-
judicial review and to ultimately petition DHS for the admission of the 
aliens. In emergency situations, however, the OFLC Administrator may 
waive the time period specified in this section on behalf of employers 
who have not made use of temporary alien workers for the prior year's 
harvest or for other good and substantial cause, provided the OFLC 
Administrator has sufficient labor market information to make the labor 
certification determinations required by 8 CFR 214.2(h)(3)(i).

(Approved by the Office of Management and Budget under control number 
1205-0015)



Sec.  655.202  Contents of job offers.

    (a) So that the employment of aliens will not adversely affect the 
wages and working conditions of similarly employed U.S. workers, each 
employer's job offer to U.S. workers must offer U.S. workers at least 
the same benefits which the employer is offering, intends to offer, or 
will afford, to temporary foreign workers. Conversely, no job offer may 
impose on U.S. workers any restrictions or obligations which will not be 
imposed on the employer's foreign workers. For example, if the employer 
intends to advance transportation costs to foreign workers either 
directly or indirectly (by having them paid by the foreign government 
involved), the employer must offer to advance the transportation costs 
of U.S. workers.
    (b) Except when higher benefits, wages or working conditions are 
required by the provisions of paragraph (a) of this section, the OFLC 
Administrator has determined that, in order to protect similarly 
employed U.S. workers from adverse effect with respect to wages and 
working conditions, every job offer for U.S. workers must always include 
the following minimal benefit, wage, and working condition provisions:
    (1) The employer will provide the worker with housing without charge 
to the worker. The housing will meet the full set of standards set forth 
at 29 CFR 1910.142 or the full set of standards set forth at part 654, 
subpart E of this chapter, whichever is applicable under the criteria of 
20 CFR 654.401; except that, for mobile range housing for sheepherders, 
the housing shall meet existing Departmental guidelines. When it is the 
prevailing practice in the area of intended employment to provide family 
housing, the employer will provide such housing to such workers.
    (2)(i) If the job opportunity is covered by the State workers' 
compensation law, the worker will be eligible for workers' compensation 
for injury and disease arising out of and in the course of worker's 
employment; or
    (ii) If the job opportunity is not covered by the State workers' 
compensation law, the employer will provide at no cost to the worker, 
insurance covering injury and disease arising out of and in the course 
of the worker's employment which will provide benefits at least equal to 
those provided under the State workers' compensation law for comparable 
employment;

[[Page 569]]

    (3) The employer will provide without cost to the worker all tools, 
supplies and equipment required to perform the duties assigned and, if 
any of these items are provided by the worker, the employer will 
reimburse the worker for the cost of those so provided;
    (4) The employer will provide the worker with three meals a day, 
except that where under prevailing practice or longstanding arrangement 
at the establishment workers prepare their meals, employers need furnish 
only free and convenient cooking and kitchen facilities. Where the 
employer provides the meals, the job offer shall state the cost to the 
worker for such meals. Until a new amount is set pursuant to this 
paragraph (b)(4), the cost shall not be more than $4.94 per day unless 
the OFLC Administrator has approved a higher cost pursuant toSec. 
655.211 of this part. Each year the charge allowed by this paragraph 
(b)(4) will be changed by the 12-month percent change for the Consumer 
Price Index for All Urban Consumers for Food between December of the 
year just concluded and December of the year prior to that. The annual 
adjustments shall be effective on their publication by the OFLC 
Administrator in the Federal Register.
    (5)(i) The employer will provide or pay for the worker's 
transportation and daily subsistence from the place, from which the 
worker, without intervening employment, will come to work for the 
employer, to the place of employment, subject to the deductions allowed 
by paragraph (b)(13) of this section. The amount of the daily 
subsistence payment shall be at least as much as the amount the employer 
will charge the worker for providing the worker with three meals a day 
during employment;
    (ii) If the worker completes the work contract period, the employer 
will provide or pay for the worker's transportation and daily 
subsistence from the place of employment to the place, from which the 
worker, without intervening employment, came to work for the employer, 
unless the worker has contracted for employment with a subsequent 
employer who, in that contract, has agreed to pay for the worker's 
transportation and daily subsistence expenses from the employer's 
worksite to such subsequent employer's worksite; and
    (iii) The employer will provide transportation between the worker's 
living quarters and the employer's worksite without cost to the worker, 
and such transportation will be in accordance with applicable laws and 
regulations;
    (6)(i) The employer guarantees to offer the worker employment for at 
least three-fourths of the workdays of the total period during which the 
work contract and all extensions thereof are in effect, beginning with 
the first workday after the arrival of the worker at the place of 
employment and ending on the termination date specified in the work 
contract, or in its extensions if any. For purposes of this paragraph, a 
workday shall mean any period consisting of 8 hours of work time. An 
employer shall not be considered to have met the work guarantee if the 
employer has merely offered work on three-fourths of the workdays. The 
work must be offered for at least three-fourths of the 8 hour workdays. 
(That is, \3/4\ x (number of days x 8 hours.)) Therefore, if, for 
example, the contract contains 20 workdays, the worker must be offered 
employment for 120 hours during the 20 workdays. A worker may be offered 
more than 8 hours of work on a single workday. For purposes of meeting 
the guarantee, however, the worker may not be required to work for more 
than 8 hours per workday, or on the worker's Sabbath or Federal 
holidays;
    (ii) If the worker will be paid on a piece rate basis, the employer 
will use the worker's average hourly earnings to calculate the amount 
due under the guarantee; and
    (iii) Any hours which the worker fails to work when the worker has 
been offered an opportunity to do so pursuant to paragraph (b)(6)(i) of 
this section, and all hours of work actually performed (including 
voluntary work over 8 hours in a workday, or on the worker's Sabbath or 
Federal holidays) may be counted by the employer in calculating whether 
the period of guaranteed employment has been met;
    (7)(i) The employer will keep accurate and adequate records with 
respect to the workers' earnings, including

[[Page 570]]

field tally records, supporting summary payroll records, and records 
showing: The nature and amount of the work performed; the number of 
hours of work offered each day by the employer (broken out by hours 
offered both in accordance with, and over and above, the guarantee); the 
hours actually worked each day by the worker; the time the worker began 
and ended each workday; the rate of pay; the worker's earnings per pay 
period; and the amount of and reasons for any and all deductions made 
from the worker's wages;
    (ii) If the number of hours worked by the worker is less than the 
number offered in accordance with the guarantee, the records will state 
the reason or reasons therefor;
    (iii) The records, including field tally records and supporting 
summary payroll records, will be made available for inspection and 
copying by representatives of the Secretary of Labor, and by the worker 
and the worker's representatives; and
    (iv) The employer will retain the records for not less than three 
years after the completion of the contract;
    (8) The employer will furnish to the worker at or before each 
payday, in one or more written statements:
    (i) The worker's total earnings for the pay period;
    (ii) The worker's hourly rate or piece rate of pay;
    (iii) The hours of employment which have been offered to the worker 
(broken out by offers in accordance with, and over and above, the 
guarantee);
    (iv) The hours actually worked by the worker;
    (v) An itemization of all deductions made from the worker's wages; 
and
    (vi) If piece rates are used, the units produced daily;
    (9)(i) If the worker will be paid by the hour, the employer will pay 
the worker at least the adverse effect rate; or
    (ii)(A) If the worker will be paid on a piece rate basis, and the 
piece rate does not result at the end of the pay period in average 
hourly earnings during the pay period at least equal to the amount the 
worker would have earned had the worker been paid at the adverse effect 
rate, the worker's pay will be supplemented at that time so that the 
worker's earnings are at least as much as the worker would have earned 
during the pay period if the worker had been paid at the adverse effect 
rate.
    (B) If the employer who pays on a piece rate basis requires one or 
more minimum productivity standards of workers as a condition of job 
retention,
    (1) Such standards shall be no more than those applied by the 
employer in 1977, unless the OFLC Administrator approves a higher 
minimum; or
    (2) If the employer first applied for temporary labor certification 
after 1977, such standards shall be no more than those normally required 
(at the time of that first application) by other employers for the 
activity in the area of intended employment, unless the OFLC 
Administrator approves a higher minimum.
    (10) The frequency with which the worker will be paid (in accordance 
with the prevailing practice in the area of intended employment, or at 
least biweekly whichever is more frequent);
    (11) If the worker voluntarily abandons employment before the end of 
the contract period, or is terminated for cause, the employer will not 
be responsible for providing or paying for the subsequent transportation 
and subsistence expenses of any worker for whom the employer would have 
otherwise been required to pay such expenses under paragraph (b)(5)(ii) 
of this section;
    (12) If, before the expiration date specified in the work contract, 
the services of the worker are no longer required for reasons beyond the 
control of the employer due to fire or other Act of God which makes the 
fulfillment of the contract impossible, and the OFLC Administrator so 
certifies, the employer may terminate the work contract. In such cases 
the employer will make efforts to transfer the worker to other 
comparable employment acceptable to the worker. If such transfer is not 
effected, the worker
    (i) Will be returned to the place from which the worker, without 
intervening employment, came to work for the employer at the employer's 
expense; and
    (ii) Will be reimbursed the full amount of any deductions made from 
the worker's pay by the employer for

[[Page 571]]

transportation and subsistence expenses to the place of employment borne 
directly or indirectly by the employer;
    (13) The employer will make those deductions from the worker's 
paycheck which are required by law. The job offer shall specify all 
deductions, not required by law, which the employer will make from the 
worker's paycheck. All deductions shall be reasonable. The employer may 
deduct the cost of the worker's transportation and daily subsistence 
expenses to the place of employment which were borne directly by the 
employer; in such cases, however, the job offer shall state that the 
worker will be reimbursed the full amount of such deductions upon the 
worker's completion of 50 percent of the worker's contract period; and
    (14) The employer will provide the worker a copy of the work 
contract between the employer and the worker. The work contract shall 
contain all of the provisions required by paragraphs (a) and (b) of this 
section.



Sec.  655.203  Assurances.

    As part of the temporary labor certification application, the 
employer shall include assurances, signed by the employer, that:
    (a) The job opportunity is not:
    (1) Vacant because the former occupant is on strike or being locked 
out in the course of a labor dispute; or
    (2) At issue in a labor dispute involving a work stoppage;
    (b) During the period for which the temporary labor certification is 
granted, the employer will comply with applicable Federal, State and 
local employment-related laws, including employment related health and 
safety laws;
    (c) The job opportunity is open to all qualified U.S. workers 
without regard to race, color, national origin, sex, or religion, and is 
open to U.S. workers with handicaps who are qualified to perform the 
work. No U.S. worker will be rejected for employment for other than a 
lawful job related reason;
    (d) The employer will cooperate with the employment service system 
in the active recruitment of U.S. workers until the foreign workers have 
departed for the employer's place of employment by;
    (1) Allowing the employment service system to prepare local, 
intrastate and interstate job orders using the information supplied on 
the employer's job offer;
    (2) Placing at least two advertisements for the job opportunities in 
local newspapers of general circulation.
    (i) Each such advertisement shall describe the nature and 
anticipated duration of the job opportunity; offer at least the adverse 
effect wage rate; give the \3/4\ guarantee; state that work tools, 
supplies and equipment will be provided by the employer; state that 
housing will also be provided, and that transportation and subsistence 
expenses to the worksite will be provided or paid for by the employer;
    (ii) Each advertisement shall direct interested workers to apply for 
the job opportunity at the appropriate office of the State Workforce 
Agency in their area;
    (3) Cooperating with the employment service system in contacting 
farm labor contractors, migrant workers and other potential workers in 
other areas of the State and/or Nation by letter and/or telephone;
    (4) Cooperating with the employment service system in contacting 
schools, business and labor organizations, fraternal and veterans 
organizations, and non-profit organizations and public agencies such as 
sponsors of programs under the Comprehensive Employment and Training 
Act, throughout the area of intended employment, in order to enlist them 
in helping to find U.S. workers; and
    (5) If the employer, or an association of employers of which the 
employer is a member, intends to negotiate and/or contract with the 
Government of a foreign nation or any foreign association, corporation 
or organization in order to secure foreign workers, making the same kind 
and degree of efforts to secure U.S. workers;
    (e) From the time the foreign workers depart for the employer's 
place of employment, the employer will provide employment to any 
qualified U.S. worker who applies to the employer until fifty percent of 
the period of the work contract, under which the foreign

[[Page 572]]

worker who is in the job was hired, has elapsed. In addition, the 
employer will offer to provide housing, and the other benefits, wages, 
and working conditions required bySec. 655.202, to any such U.S. 
worker; and
    (f) Performing the other specific recruitment activities specified 
in the notice from the OFLC Administrator required bySec. 655.205(a).



Sec.  655.204  Determinations based on temporary labor certification
applications.

    (a) Within two working days after the temporary labor certification 
application has been filed with it, the SWA shall mail the duplicate 
application directly to the appropriate OFLC Administrator.
    (b) The SWA, using the job offer portion of its copy of the 
temporary labor certification application, shall promptly prepare a 
local job order and shall begin to recruit U.S. workers in the area of 
intended employment.
    (c) The OFLC Administrator, upon receipt of the duplicate temporary 
labor certification application, shall promptly review the application 
to determine whether it meets the requirements of Sec.Sec. 655.201-
655.203 in order to determine whether the employer's application is (1) 
timely, and (2) contains offers of wages, benefits, and working 
conditions required to ensure that similarly employed U.S. workers will 
not be adversely affected. If the OFLC Administrator determines that the 
temporary labor certification application is not timely in accordance 
withSec. 655.201 of this subpart, the OFLC Administrator may promptly 
deny the temporary labor certification on the grounds that, in 
accordance with that regulation, there is not sufficient time to 
adequately test the availability of U.S. workers. If the OFLC 
Administrator determines that the application does not meet the 
requirements of Sec.Sec. 655.202-655.203 because the wages, working 
conditions, benefits, assurances, job offer, etc. are not as required, 
the OFLC Administrator shall deny the certification on the grounds that 
the availability of U.S. workers cannot be adequately tested because the 
wages or benefits, etc. do not meet the adverse effect criteria.
    (d) If the certification is denied, the OFLC Administrator shall 
notify the employer in writing of the determination, with a copy to the 
SWA. The notice shall:
    (1) State the reasons for the denial, citing the relevant 
regulations; and
    (2) Offer the employer an opportunity to request an expedited 
administrative-judicial review of the denial by an Administrative Law 
Judge. The notice shall state that in order to obtain such a review, the 
employer must, within five calendar days of the date of the notice, file 
by facsimile (fax), telegram, or other means normally assuring next day 
delivery a written request for such a review to the Chief Administrative 
Law Judge of the Department of Labor (giving the address) and 
simultaneously serve a copy on the OFLC Administrator. The notice shall 
also state that the employer's request for review should contain any 
legal arguments which the employer believes will rebut the basis of the 
OFLC Administrator's denial of certification; and
    (3) State that, if the employer does not request an expedited 
administrative-judicial review before an Administrative Law Judge within 
the five days:
    (i) The OFLC Administrator will advise the DHS that the 
certification cannot be granted, giving the reasons therefor, and that 
an administrative-judicial review of the denial was offered to the 
employer but not accepted, and enclosing, for DHS review, the entire 
temporary labor certification application file; and
    (ii) The employer has the opportunity to submit evidence to the DHS 
to rebut the bases of the OFLC Administrator's determination in 
accordance with the DHS regulation at 8 CFR 214.2(h)(3)(i) but that no 
further review of the employer's application for temporary labor 
certification may be made by any Department of Labor official.
    (e) If the employer timely requests an expedited administrative-
judicial review pursuant to paragraph (d)(2) of this section, the 
procedures ofSec. 655.212 shall be followed.

[[Page 573]]



Sec.  655.205  Recruitment period.

    (a) If the OFLC Administrator determines that the temporary labor 
certification application meets the requirements of Sec.Sec. 655.201 
through 655.203, the OFLC Administrator shall promptly notify the 
employer in writing, with copies to the SWA. The notice shall inform the 
employer and the SWA of the specific efforts which will be expected from 
them during the following weeks to carry out the assurances contained in 
Sec.  655.203 with respect to the recruitment of U.S. workers. The 
notice shall require that the job order be placed both into intrastate 
clearance and into interstate clearance to such States as the OFLC 
Administrator shall determine to be potential sources of U.S. workers.
    (b) Thereafter, OFLC Administrator, shall provide overall direction 
to the employer and the SWA with respect to the recruitment of U.S. 
workers.
    (c) By the 60th day of the recruitment period, or 20 days before the 
date of need specified in the application, whichever is later, the OFLC 
Administrator, when making a determination of the availability of U.S. 
workers, shall also make a determination as to whether the employer has 
satisfied the recruitment assurances inSec. 655.203. If the OFLC 
Administrator concludes that the employer has not satisfied the 
requirement for recruitment of U.S. workers, the OFLC Administrator 
shall deny the temporary labor certification, and shall immediately 
notify the employer in writing with a copy to the State agency. The 
notice shall contain the statements specified inSec. 655.204(d).
    (d) If the employer timely requests an expedited administrative-
judicial review before an Administrative Law Judge, the procedures in 
Sec.  655.212 shall be followed.



Sec.  655.206  Determinations of U.S. worker availability and adverse
effect on U.S. workers.

    (a) If the OFLC Administrator, in accordance withSec. 655.205 has 
determined that the employer has complied with the recruitment 
assurances, the OFLC Administrator, by 60th day of the recruitment 
period, or 20 days before the date of need specified in the application, 
whichever is later, shall grant the temporary labor certification for 
enough aliens to fill the employer's job opportunities for which U.S. 
workers are not available. In making this determination the OFLC 
Administrator shall consider as available for a job opportunity any U.S. 
worker who has made a firm commitment to work for the employer, 
including those workers committed by other authorized persons such as 
farm labor contractors and family heads; such a firm commitment shall be 
considered to have been made not only by workers who have signed work 
contracts with the employer, but also by those whom the OFLC 
Administrator determines are very likely to sign such a work contract. 
The OFLC Administrator shall also count as available any U.S. worker who 
has applied to the employer (or on whose behalf an application has been 
made), but who was rejected by the employer for other than lawful job-
related related reasons unless the OFLC Administrator determines that:
    (1) Enough qualified U.S. workers have been found to fill all the 
employer's job opportunities; or
    (2) The employer, since the time of the initial determination under 
Sec.  655.204, has adversely affected U.S. workers by offering to, or 
agreeing to provide to, alien workers better wages, working conditions, 
or benefits (or by offering or agreeing to impose on alien workers less 
obligations and restrictions) than that offered to U.S. workers.
    (b)(1) Temporary labor certifications shall be considered subject to 
the conditions and assurances made during the application process. 
Temporary labor certifications shall be for a limited duration such as 
for ``the 1978 apple harvest season'' or ``until November 1, 1978'', and 
they shall never be for more than eleven months. They shall be limited 
to the employer's specific job opportunities; therefore, they may not be 
transferred from one employer to another.
    (2) If an association of employers is itself the employer, as 
defined inSec. 655.200, certifications shall be made to the 
association and may be used for any of the job opportunities of its 
employer members and workers may be transferred among employer members.

[[Page 574]]

    (3) If an association of employers is a joint employer with its 
employer members, as defined inSec. 655.200, the certification shall 
be made jointly to the association and the employer members. In such 
cases workers may be transferred among the employer members provided the 
employer members and the association agree in writing to be jointly and 
severally liable for compliance with the temporary labor certification 
obligations set forth in this subpart.
    (c) If the OFLC Administrator denies the temporary labor 
certification in whole or part, the OFLC Administrator shall notify the 
employer in writing by means normally assuring next-day delivery. The 
notice shall contain all of the statements required inSec. 655.204(d). 
If a timely request is made for an administrative-judicial review by an 
Administrative Law Judge, the procedures ofSec. 655.212 shall be 
followed.
    (d)(1) After a temporary labor certification has been granted, the 
employer shall continue its efforts to actively recruit U.S. workers 
until the foreign workers have departed for the employer's place of 
employment. The employer, however, must keep an active job order on file 
until the assurance atSec. 655.203(e) is met.
    (2) The State Workforce Agency (SWA) system shall continue to 
actively recruit and refer U.S. workers as long as there is an active 
job order on file.



Sec.  655.207  Adverse effect rates.

    (a) Except as otherwise provided in this section, the adverse effect 
rates for all agricultural and logging employment shall be the 
prevailing wage rates in the area of intended employment.
    (b)(1) For agricultural employment (except sheepherding) in the 
States listed in paragraph (b)(2) of this section, and for Florida 
sugarcane work, the adverse effect rate for each year shall be computed 
by adjusting the prior year's adverse effect rate by the percentage 
change (from the second year previous to the prior year) in the U.S. 
Department of Agriculture's (USDA's) average hourly wage rates for field 
and livestock workers (combined) based on the USDA Quarterly Wage 
Survey. The OFLC Administrator shall publish, at least once in each 
calendar year, on a date or dates he shall determine, adverse effect 
rates calculated pursuant to this paragraph (b) as a notice or notices 
in the Federal Register.
    (2) List of States. Arizona, Colorado, Connecticut, Florida (other 
than sugar cane work), Maine, Maryland, Massachusetts, New Hamsphire, 
New York, Rhode Island, Texas, Vermont, Virginia, and West Virginia. 
Other States may be added as appropriate.
    (3) Transition. Notwithstanding paragraphs (b)(1) and (2) of this 
section, the 1986 adverse effect rate for agricultural employment 
(except sheepherding) in the following States, and for Florida sugarcane 
work, shall be computed by adjusting the 1981 adverse effect rate 
(computed pursuant to 20 CFR 655.207(b)(1), 43 FR 10317; March 10, 1978) 
by the percentage change between 1980 and 1985 in the U.S. Department of 
Agriculture annual average hourly wage rates for field and livestock 
workers (combined) based on the USDA Quarterly survey: The States listed 
at 20 CFR 655.207(b)(2) (1985).
    (c) In no event shall an adverse effect rate for any year be lower 
than the hourly wage rate published in 29 U.S.C. 206(a)(1) and currently 
in effect.



Sec.  655.208  Temporary labor certification applications involving 
fraud or willful misrepresentation.

    (a) If possible fraud or willful misrepresentation involving a 
temporary labor certification application is discovered prior to a final 
temporary labor certification determination, or if it is learned that 
the employer or agent (with respect to an application) is the subject of 
a criminal indictment or information filed in a court, the OFLC 
Administrator shall refer the matter to the DHS for investigation and 
shall notify the employer or agent in writing of this referral. The OFLC 
Administrator shall continue to process the application and may issue a 
qualified temporary labor certification.
    (b) If a court finds an employer or agent innocent of fraud or 
willful misrepresentation, or if the Department of

[[Page 575]]

Justice decides not to prosecute an employer or agent, the OFLC 
Administrator shall not deny the temporary labor certification 
application on the grounds of fraud or willful misrepresentation. The 
application, of course, may be denied for other reasons pursuant to this 
subpart.
    (c) If a court or the DHS determines that there was fraud or willful 
misrepresentation involving a temporary labor certification application, 
the application shall be deemed invalidated, processing shall be 
terminated, and the application shall be returned to the employer or 
agent with the reasons therefor stated in writing.



Sec.  655.209  Invalidation of temporary labor certifications.

    After issuance, temporary labor certifications are subject to 
invalidation by the DHS upon a determination, made in accordance with 
that agency's procedures or by a Court, of fraud or willful 
misrepresentation of a material fact involving the temporary labor 
certification application. If evidence of such fraud or willful 
misrepresentation becomes known to the OFLC Administrator, the OFLC 
Administrator shall notify the DHS in writing.



Sec.  655.210  Failure of employers to comply with the terms of a 
temporary labor certification.

    (a) If, after the granting of a temporary labor certification, the 
OFLC Administrator has probable cause to believe that an employer has 
not lived up to the terms of the temporary labor certification, the OFLC 
Administrator shall investigate the matter. If the OFLC Administrator 
concludes that the employer has not complied with the terms of the labor 
certification, the OFLC Administrator may notify the employer that it 
will not be eligible to apply for a temporary labor certification in the 
coming year. The notice shall be in writing, shall state the reasons for 
the determination, and shall offer the employer an opportunity to 
request a hearing within 30 days of the date of the notice. If the 
employer requests a hearing within the 30-day period, the OFLC 
Administrator shall follow the procedures set forth atSec. 
658.421(i)(1), (2) and (3) of this chapter. The procedures contained in 
Sec.Sec. 658.421(j), 658.422 and 658.423 of this chapter shall apply 
to such hearings.
    (b) No other penalty shall be imposed by the employment service on 
such an employer other than as set forth in paragraph (a) of this 
section.



Sec.  655.211  Petition for higher meal charges.

    (a) Until a new amount is set pursuant to this paragraph (a), the 
OFLC Administrator may permit an employer to charge workers up to $6.17 
for providing them with three meals per day, if the employer justifies 
the charge and submits to the OFLC Administrator the documentary 
evidence required by paragraph (b) of this section. A denial in whole or 
in part shall be reviewable as provided inSec. 655.212 of this part. 
Each year the maximum charge allowed by this paragraph (a) will be 
changed by the 12-month percent change for the Consumer Price Index for 
All Urban Consumers for Food between December of the year just concluded 
and December of the year prior to that. The annual adjustments shall be 
effective on their publication by the OFLC Administrator in the Federal 
Register.
    (b) Evidence submitted shall include the cost of goods and services 
directly related to the preparation and serving of meals, the number of 
workers fed, the number of meals served and the number of days meals 
were provided. The cost of the following items may be included: Food; 
kitchen supplies other than food, such as lunch bags and soap; labor 
costs which have a direct relation to food service operations, such as 
wages of cooks and restaurant supervisors; fuel, water, electricity, and 
other utilities used for the food service operations; other costs 
directly related to the food service operation. Charges for 
transportation, depreciation, overhead, and similar charges may not be 
included. Receipts and other cost records for a representative pay 
period shall be available for inspection by the Secretary's 
representatives for a period of one year.

[[Page 576]]



Sec.  655.212  Administrative-judicial reviews.

    (a) Whenever an employer has requested an administrative-judicial 
review of a denial of an application or a petition in accordance with 
Sec.Sec. 655.204(d), 655.205(d), 655.206(c), or 655.211, the Chief 
Administrative Law Judge shall immediately assign an Administrative Law 
Judge to review the record for legal sufficiency, and the OFLC 
Administrator shall send a certified copy of the case file to the Chief 
Administrative Law Judge by means normally assuring next day delivery. 
The Administrative Law Judge shall not have authority to remand the case 
and shall not receive additional evidence. Any countervailing evidence 
advanced after decision by the OFLC Administrator shall be subject to 
provisions of 8 CFR 214.2(h)(3)(i).
    (b) The Administrative Law Judge, within five working days after 
receipt of the case file shall, on the basis of the written record and 
due consideration of any written memorandums of law submitted, either 
affirm, reverse or modify the OFLC Administrator's denial by written 
decision. The decision of the Administrative Law Judge shall specify the 
reasons for the action taken and shall be immediately provided to the 
employer, OFLC Administrator, and DHS by means normally assuring next-
day delivery. The Administrative Law Judge's decision shall be the final 
decision of the Department of Labor and no further review shall be given 
to the temporary labor certification determination by any Department of 
Labor official.



Sec.  655.215  Territory of Guam.

    Subpart C of this part does not apply to temporary employment in the 
Territory of Guam, and the Department of Labor does not certify to the 
United States Citizenship and Immigration Services of the Department of 
Homeland Security (DHS) the temporary employment of nonimmigrant aliens 
under H-2B visas in the Territory of Guam. Pursuant to DHS regulations, 
that function is performed by the Governor of Guam, or the Governor's 
designated representative within the Territorial Government.



   Subpart D_Attestations by Facilities Using Nonimmigrant Aliens as 
                            Registered Nurses

    Source: 59 FR 882, 897, Jan. 6, 1994, unless otherwise noted.



Sec.  655.300  Purpose and scope of subparts D and E.

    (a) Purpose. The Immigration and Nationality Act (INA) establishes 
the H-1A program to provide relief for the nursing shortage crisis. 
Subpart D of this part sets forth the procedure by which health care 
facilities seeking to use nonimmigrant registered nurses may submit 
attestations to the Department of Labor relating to the effects of the 
nursing shortage on their operations, their efforts to recruit and 
retain United States workers as registered nurses and certain 
information on wages and working conditions for nurses at the facility. 
Subpart E of this part sets forth complaint, investigation, and penalty 
provisions with respect to such attestations.
    (b) Procedure. The INA establishes a procedure for health care 
facilities to follow in seeking admission to the United States for, or 
use of, nonimmigrant nurses under H-1A visas. The procedure is designed 
to reduce reliance on nonimmigrant nurses in the future, and calls of 
the health care facility to attest, and be able to demonstrate, that, 
e.g., there would be substantial disruption to health services without 
the nonimmigrant nurses and that it is taking timely and significant 
steps to develop, recruit, and retain U.S. nurses. Subparts D and E of 
this part set forth the specific requirements for those procedures.
    (c) Applicability. (1) Subparts D and E of this part apply to all 
facilities that seek the temporary admission or use of nonimmigrants as 
registered nurses.
    (2) During the period that the provisions of appendix 1603.D.4 of 
Annex 1603 of the North American Free Trade Agreement (NAFTA) apply, 
subparts D and E of this part shall apply to the entry of a nonimmigrant 
who is a citizen of Mexico under and pursuant to the provisions of 
section D of Annex 1603 of NAFTA.

[[Page 577]]



Sec.  655.301  Overview of process.

    This section provides a context for the attestation process, to 
facilitate understanding by health care facilities that may seek 
nonimmigrant nurses under H-1A visas.
    (a) Federal agencies' responsibilities. The United States Department 
of Labor (DOL), Department of Justice, and Department of State are 
involved in the H-1A visa process. Within DOL, the Employment and 
Training Administration (ETA) and the Employment Standards 
Administration (ESA) have responsibility for different aspects of the 
process.
    (b) Health care facility's attestation responsibilities. Each health 
care facility seeking one or more H-1A nurses shall, as the first step, 
submit an attestation on Form ETA 9029, as described inSec. 655.310 of 
this part, to the designated regional office of the Employment and 
Training Administration (ETA) of DOL. If the attestation is found to 
meet the requirements set atSec. 655.310 (a) through (k) of this part, 
ETA shall accept the attestation for filing, shall return the cover form 
of the accepted attestation to the health care facility, and shall 
notify the Immigration and Naturalization Service (INS) of the 
Department of Justice of the filing. As discussed inSec. 655.310 of 
this part, if the facility proposes to utilize alternative methods to 
comply with Attestation Elements I and/or IV, or asserts that taking a 
second timely and significant step under Element IV would be 
unreasonable, or claims a bona fide medical emergency exemption from 
Element IV as a worksite using one or more H-1A nurses through a nursing 
contractor only, additional supporting information and ETA review shall 
be required.
    (c) Visa petitions. Upon ETA's acceptance of the filing, the health 
care facility may then file with INS H-1A visa petitions for the 
admission of H-1A nurses, or to extend the stay of alien nurses 
currently working at the facility. the facility shall attach a copy of 
the accepted attestation form (Form ETA 9029) to the visa petition filed 
with INS. At the same time that the facility files a visa petition with 
INS, it shall also send a copy of the visa petition with INS, it shall 
also send a copy of the visa petition to the Chief, Division of Foreign 
Labor Certifications, U.S. Employment Service, Employment and Training 
Administration, Department of Labor, 200 Constitution Avenue, NW., room 
N-4456, Washington, DC 20210.
    (d) Visa issuance. INS assures that the nonimmigrants possess the 
required qualifications and credentials to be employed as nurses. See 8 
U.S.C. 1182(m)(1)). The Department of State is responsible for issuing 
the visa.
    (e) Board of Alien Labor Certification Appeals (BALCA) review of 
attestations accepted and not accepted for filing. The decision whether 
or not to accept for filing an attestation which ETA has reviewed, that 
is: an attestation where the facility is attesting to alternative 
methods of compliance with Element I and/or Element IV; an attestation 
where the facility is claiming that taking a second timely and 
significant step would not be reasonable; and/or an attestation where a 
facility that is not an employer of H-1A nurses is claiming a bond fide 
medical emergency as the basis for requesting a waiver of Element IV; 
may be appealed by any interested party to the BALCA.
    (f) Complaints. Complaints concerning misrepresentation in the 
attestation or failure of the health care facility to carry out the 
terms of the attestation may be filed with the Wage and Hour Division 
(Division), Employment Standards Administration (ESA) of DOL, according 
to the procedures set forth in subpart E of this part. Complaints of 
``misrepresentation'' may include assertions that a facility's 
attestations of compliance failed to meet the regulatory standards for 
attestation elements under which the attestation was accepted by ETA for 
filing without ETA review. The Division shall then investigate, and, 
where appropriate, after an opportunity for a hearing, assess sanctions 
and penalties. Subpart E of this part also provides that interested 
parties may obtain an administrative law judge hearing and may seek the 
Secretary's review of the administrative law judge's decision.



Sec.  655.302  Definitions.

    For the purposes of subparts D and E of this part:

[[Page 578]]

    Accepted for filing means that the attestation and supporting 
documentation submitted by the health care facility have been received 
by the Employment and Training Administration of the Department of Labor 
(DOL) and have been found to be in compliance with the attestation 
requirements inSec. 655.310 of this part.
    Act and INA mean the Immigration and Nationality Act, as amended, 8 
U.S.C. 1101 et seq.
    Administrative law judge means an official appointed pursuant to 5 
U.S.C. 3105.
    Administrator means the Administrator of the Wage and Hour Division, 
Employment Standards Administration, Department of Labor, and such 
authorized representatives as may be designated to perform any of the 
functions of the Administrator under subparts D and E of this part.
    Attorney General means the chief official of the U.S. Department of 
Justice or the Attorney General's designee.
    Board of Alien Labor Certification Appeals (BALCA) means a panel of 
one or more administrative law judges who serve on the permanent Board 
of Alien Labor Certification Appeals established by 20 CFR Part 656. 
BALCA consists of administrative law judges assigned to the Department 
of Labor and designated by the Chief Administrative Law Judge to be 
members of the Board of Alien Labor Certification Appeals.
    Bona fide medical emergency means a situation in which the services 
of one or more H-1A contract nurses are necessary at a worksite facility 
(which itself does not employ an H-1A nurse) to prevent death or serious 
impairment of health, and, because of the danger to life or health, 
nursing services for such situation are not elsewhere available in the 
geographic area.
    Certifying Officer means a Department of Labor official, or such 
official's designee, who makes determinations about whether or not H-1A 
attestations are acceptable for filing.
    Chief Administrative Law Judge means the chief official of the 
Office of the Administrative Law Judges of the Department of Labor or 
the Chief Administrative Law Judge's designee.
    Chief, Division of Foreign Labor Certifications, USES means the 
chief official of the Division of Foreign Labor Certifications within 
the United States Employment Service, Employment and Training 
Administration, Department of Labor, or the designee of the Chief, 
Division of Foreign Labor Certifications, USES.
    Date of filing means the date an attestation is ``accepted for 
filing'' by ETA.
    Department and DOL mean the United States Department of Labor.
    Director means the chief official of the United States Employment 
Service (USES), Employment and Training Administration, Department of 
Labor, or the Director's designee.
    Division means the Wage and Hour Division of the Employment 
Standards Administration, DOL.
    Employer means a person, firm, corporation, or other association or 
organization involved in the direct provision of health care services, 
which:
    (1) Suffers or permits a person to work;
    (2) Has a location within the United States to which U.S. workers 
may be referred for employment;
    (3) Proposes to employ workers at a place within the United States; 
and
    (4) Has an employer-employee relationship with respect to employees 
under subpart D and E of this part, as indicated by the fact that it may 
hire, pay, fire, supervise or otherwise control the work of such 
employee.
    Employment means full-time work by an employee for an employer/
health care facility other than oneself. ``Full-time work'' means work 
where the nurse is regularly scheduled to work 40 hours or more per 
week, unless the facility documents as part of its attestation that it 
is common practice for the occupation at the facility or for the 
occupation in the geographic area for nurses to work fewer hours per 
week.
    Employment and Training Administration (ETA) means the agency within 
the Department of Labor (DOL) which includes the United States 
Employment Service (USES).
    Employment Standards Administration (ESA) means the agency within 
the Department of Labor (DOL) which includes the Wage and Hour Division.
    Facility means a user of nursing services with either a single site 
or a group

[[Page 579]]

of contiguous locations at which it provides health care services. 
``Facility'' includes an employer of registered nurses which provides 
health care services in a home or other setting, such as a hospital, 
nursing home, or other site of employment, not owned or operated by the 
employer (e.g., a visiting nurse association or a nursing contractor). 
``Facility'' also includes a private household which employs or seeks to 
employ one or more H-1A nurses, but does not include a private household 
which uses H-1A nurses only through a nursing contractor. Groups of 
structures which form a campus or separate buildings across the street 
from one another are a single facility. However, separate buildings or 
areas which are not physically connected or in immediate proximity are a 
single health care facility if they are in reasonable geographic 
proximity, used for the same purpose, and share the same nursing staff 
and equipment. An example is an entity which manages a nursing home and 
a hospital in the same area and which regularly shifts or rotates the 
nurses between the two. Non-contiguous sites, even within the same 
geographic area, which do not share the same nursing staff and 
operational purposes are not a single facility. For example, hospitals 
which are located on opposite sides of a municipality, but which are 
managed or owned by a single entity, are separate facilities if they do 
not regularly share nursing staff and operational purpose.
    Geographic area means the area within normal commuting distance of 
the place (address) of the intended worksite. If the geographic area 
does not include a sufficient number of facilities to make a prevailing 
wage determination, the term ``geographic area'' shall be expanded (by 
the State employment service, unless directed not to do so by the 
Director) with respect to the attesting facility to include a sufficient 
number of facilities to permit a prevailing wage determination to be 
made. If the place of the intended worksite is within a Metropolitan 
Statistical Area (MSA), any place within the MSA may be deemed to be 
within normal commuting distance of the place of intended employment.
    Governor means the chief elected official of a State or the 
Governor's designee.
    H-1A nurse means any nonimmigrant alien admitted to the United 
States to perform services as a nurse under section 101(a)(15)(H)(i)(a) 
of the Act (8 U.S.C. 1101(a)(15)(H)(i)(a)).
    Immigration and Naturalization Service (INS) means the component of 
the Department of Justice which makes the determination under the Act on 
whether to grant visa petitions to petitioners seeking the admission of 
nonimmigrant nurses under H-1A visas.
    Layoff means any involuntary separation of one or more staff nurses 
without cause/prejudice. If a staff nurse is separated from one 
specialized activity and is offered retraining and retention at the same 
facility in another activity involving direct patient care at the same 
wage and status, but refuses such training and retention, such 
separation shall not constitute a layoff. The layoff provision applies 
to staff nurses only, not to other health occupations. If the position 
occupied by the staff nurse is covered by a collective bargaining 
agreement, the collective bargaining agreement definition of ``layoff'' 
(if any) shall apply to that position.
    Lockout means a labor dispute involving a work stoppage, wherein an 
employer withholds work from its employees in order to gain a concession 
from them.
    Nurse means a person who is or will be authorized by a State Board 
of Nursing to engage in registered nursing practice in a State or U.S. 
territory or possession at a facility which provides health care 
services. A staff nurse means a nurse who provides nursing care directly 
to patients. In order to qualify under this definition of ``nurse'' the 
alien shall:
    (1) Have obtained a full and unrestricted license to practice 
nursing in the country where the alien obtained nursing education, or 
have received nursing education in the United States or Canada;
    (2) Have passed the examination given by the Commission on Graduates 
for Foreign Nursing Schools (CGFNS), or have obtained a full and 
unrestricted (permanent) license to practice as a registered nurse in 
the state

[[Page 580]]

of intended employment, or have obtained a full and unrestricted 
(permanent) license in any state or territory of the United States and 
received temporary authorization to practice as a registered nurse in 
the state of intended employment; and,
    (3) Be fully qualified and eligible under the laws (including such 
temporary or interim licensing requirements which authorize the nurse to 
be employed) governing the place of intended employment to practice as a 
registered nurse immediately upon admission to the United States, and be 
authorized under such laws to be employed by the employer. For purposes 
of this paragraph, the temporary or interim licensing may be obtained 
immediately after the alien enters the United States and registers to 
take the first available examination for permanent licensure.
    Nursing contractor means an entity that employs registered nurses 
and supplies these nurses, on a temporary basis and for a fee, to health 
care facilities or private homes.
    Prevailing wage means the average wage paid to similarly employed 
registered nurses within the geographic area.
    Secretary means the Secretary of Labor or the Secretary's designee.
    Similarly employed means employed by the same type of facility 
(acute care or long-term care) and working under like conditions, such 
as the same shift, on the same days of the week, and in the same 
specialty area.
    State means one of the 50 States, the District of Columbia, Puerto 
Rico, the U.S. Virgin Islands, and Guam.
    State employment security agency (SESA) means the State agency 
designated under section 4 of the Wagner-Peyser Act to cooperate with 
USES in the operation of the national system of public employment 
offices.
    Strike means a labor dispute wherein employees engage in a concerted 
stoppage or work (including stoppage by reason of the expiration of a 
collective-bargaining agreement) or engage in any concerted slowdown or 
other concerted interruption of operations.
    United States Employment Service (USES) means the agency of the 
Department of Labor, established under the Wagner-Peyser Act, which is 
charged with administering the national system of public employment 
offices.
    United States (U.S.) nurse means any nurse who is a U.S. citizen; is 
a U.S. national; is lawfully admitted for permanent residence; is 
granted the status of an alien admitted for temporary residence under 8 
U.S.C. 1160(a), 1161(a), or 1255a(a)(1); is admitted as a refugee under 
8 U.S.C. 1157; or is granted asylum under 8 U.S.C. 1158.
    United States (U.S.) worker means any worker who is a U.S. citizen; 
is a U.S. national; is lawfully admitted for permanent residence; is 
granted the status of an alien lawfully admitted for temporary residence 
under 8 U.S.C. 1160(a), 1161(a), or 1255(a)(1); is admitted as a refugee 
under 8 U.S.C. 1157; or is granted asylum under 8 U.S.C. 1158.
    United States is defined at 8 U.S.C. 1101(a)(38).
    Worksite means the health care facility or home where the nurse is 
involved in the practice of nursing. It is possible, in the case of 
nursing contractors, that the employer's physical location and the 
worksite facility's physical location will differ.



Sec.  655.310  Attestations.

    (a) Who may submit attestations? Any entity meeting the definition 
of ``facility'' inSec. 655.302, may submit an attestation. The 
attestation shall include: a completed Form ETA 9029, which shall be 
signed by the chief executive officer of the facility (or the chief 
executive officer's designee); and explanatory statements prescribed in 
paragraphs (c) through (k) of this section. A nursing contractor that 
seeks to employ nonimmigrant nurses shall file its own attestation 
(including Form ETA 9029 and explanatory statements) as prescribed by 
this section, and, as part of its own attestation, shall attest that it 
shall refer H-1A nurses only to facilities that, with the exception of 
private households which themselves do not employ H-1A nurses, have 
current and valid attestations on file with ETA. Subparts D and E of 
this part shall apply both to the nursing contractor and to the worksite 
facility.
    (b) Where should attestations be submitted? Attestations shall be 
submitted,

[[Page 581]]

by U.S. mail or private carrier, to the U.S. Department of Labor ETA 
Regional Office which has jurisdiction over the geographic area where 
the H-1A nurse will be employed, as designated by the Chief, Division of 
Foreign Labor Certifications, USES. The addresses of the Certifying 
Officers are set forth in the instructions to Form ETA 9029.
    (c) What should be submitted?--(1) Form ETA 9029 and explanatory 
statements.
    (i) A completed and dated original Form ETA 9029, containing the 
required attestation elements and the original signature of the chief 
executive officer of the facility, shall be submitted, along with two 
copies of the completed, (signed, and dated) Form ETA 9029. (Copies of 
Form ETA 9029 are available at the address listed in paragraph (b) of 
this section.) In addition, explanations, where required, for the 
required attestation elements as to what documentation is available at 
the facility and how such documentation indicates compliance with the 
regulatory standards as prescribed in paragraphs (d) through (i) of this 
section. In addition,
    (A) If the facility is a nursing contractor, the special attestation 
element in paragraph (j) of this section; or
    (B) If the facility is a worksite (other than a private household 
which itself does not employ, seek to employ, or file a visa petition on 
behalf of an H-1A nurse), which will use H-1A nurses only through a 
nursing contractor, the special attestation element in paragraph (k) of 
this section, shall be submitted in triplicate with the Form ETA 9029.
    (ii) If the facility is proposing to meet alternative standards for 
substantial disruption (Element I) and/or the taking of timely and 
significant steps (Element IV), an explanation of the standards being 
proposed and an explanation of how these proposed standards are of 
comparable significance to those set forth in the statute shall be 
submitted in triplicate. If the facility is attesting that it can only 
take one timely and significant step (Element IV), it shall submit an 
explanation, in triplicate, demonstrating that taking a second step is 
unreasonable. If the facility uses H-1A nurses only through a nursing 
contractor, but claims a bona fide medical emergency exemption from 
Element IV, it shall submit a written explanation, in triplicate, 
demonstrating the existence of such an emergency. DOL may request 
additional explanation and/or documentation from a facility in the 
process of determining acceptability in cases described in this 
paragraph (c)(1)(ii).
    (2) Attestation elements. The attestation elements referenced in 
paragraph (c)(1) of this section are mandated by section 212(m)(2)(A) of 
the Act (8 U.S.C. 1182(m)(2)(A)). Section 212(m)(2)(A) of the Act 
requires covered facilities to attest as follows:
    (i) The attestation referred to in section 101(a)(15)(H)(i)(a) of 
the Act, with respect to a facility for which an alien will perform 
services, is an attestation as to the following:
    (A) There would be a substantial disruption through no fault of the 
facility in the delivery of health care services of the facility without 
the services of such an alien or aliens.
    (B) The employment of the aliens will not adversely affect the wages 
and working conditions of registered nurses similarly employed.
    (C) The aliens employed by the facility will be paid the wage rate 
for registered nurses similarly employed by the facility.
    (D) Either--(1) The facility has taken and is taking timely and 
significant steps designed to recruit and retain sufficient registered 
nurses who are United States citizens or immigrants who are authorized 
to perform nursing services, in order to remove as quickly as reasonably 
possible the dependence of the facility on nonimmigrant registered 
nurses, or
    (2) The facility is subject to an approved State plan for the 
recruitment and retention of nurses (described in section 212(m)(3) of 
the Act; 8 U.S.C. 1182(m)(3)).
    (E) There is not a strike or lockout in the course of a labor 
dispute, and the employment of such an alien is not intended or designed 
to influence an election for a bargaining representative for registered 
nurses of the facility.

[[Page 582]]

    (F) At the time of the filing of the petition for registered nurses 
under section 101(a)(15)(H)(i)(a) of the Act, notice of the filing has 
been provided by the facility to the bargaining representative of the 
registered nurses at the facility or, where there is no such bargaining 
representative, notice of the filing has been provided to registered 
nurses at the facility through posting in conspicuous locations.
    (ii) A facility is considered not to meet paragraph (c)(2)(i)(A) of 
this section (relating to an attestation of a substantial disruption in 
delivery of health care services) if the facility, within the previous 
year, has laid off registered nurses. A facility which lays off a 
registered nurse other than a staff nurse still meets the ``no layoff' 
requirement if, in its attestation, it attests that it will not replace 
the nurse with an H-1A nurse (either through promotion or otherwise) for 
a period of 1 year after the date of the layoff. Nothing in paragraph 
(c)(2)(i)(D) of this section shall be construed as requiring a facility 
to have taken significant steps described in such paragraph before 
December 18, 1989 (i.e., the date of enactment of the Immigration 
Nursing Relief Act of 1989).
    (d) The first attestation element: substantial disruption. The 
facility shall attest that ``there would be substantial disruption 
through no fault of the facility in the delivery of health care services 
of the facility without the services of such an alien or aliens.'' This 
element shall be met if the facility provides the following information:
    (1) Layoffs. The facility shall attest that it has not laid off 
nurses during the 12-month period prior to submitting the attestation. A 
facility which lays off a registered nurse other than a staff nurse 
still meets the ``no layoff'' requirement if, in its attestation it 
attests that it will not replace the nurse with an H-1A nurse (either 
through promotion or otherwise) for a period of 1 year after the date of 
the layoff.
    (2) Nursing shortage. (i) The facility shall attest to one of the 
following:
    (A) It has a current nurse vacancy rate of 7 percent or more. An 
explanatory statement does not have to be submitted for this attestation 
element, but documentation to support this attestation shall be 
maintained at the facility and shall be available for review in 
accordance withSec. 655.350(b).
    (B) It is unable to utilize 7 percent or more of its total beds due 
to a shortage of nurses. An explanatory statement does not have to be 
submitted for this attestation element, but supporting documentation for 
this attestation shall be maintained at the facility and shall be 
available for review in accordance withSec. 655.350(b).
    (C) It has had to eliminate or curtail the delivery of essential 
health care services due to a shortage of nurses, and provide brief 
explanatory information about the essential services eliminated or 
curtailed by the facility due to a nursing shortage, what documentation 
is available at the facility to substantiate this attestation, where 
this documentation is located and can be reviewed, and the applicable 
time period of the documentation.
    (D) It has been unable to effect established plans to provide needed 
new health care services in the community due to a shortage of nurses, 
and provide brief explanatory information about needed new services that 
have not been implemented by the facility due to a nursing shortage and 
which will be implemented with the availability of H-1A nurses, what 
documentation is available at the facility to substantiate this 
attestation, where this documentation is located and can be reviewed, 
and the applicable time period of the documentation.
    (ii) Other substantial disruption. When an attesting facility finds 
that the indicators in paragraphs (d)(2)(i) (A) through (D) of this 
section cannot be demonstrated, or that such indicators are 
inappropriate to that facility, but that without the services of H-1A 
nurses, substantial disruption in the delivery of health care services 
of the facility still would occur due to a shortage or nurses, the 
facility shall provide an explanation of how a shortage of nurses has 
caused a ``substantial disruption'' in the delivery of its health care 
services. Such explanation shall be sufficient to provide a clear 
showing of ``substantial disruption'' in the delivery of specific health 
care services due to a shortage of nurses,

[[Page 583]]

and shall clearly explain why the indicators in paragraphs (d)(2)(i) (A) 
through (D) of this section cannot be met by or are inappropriate to 
that facility. In addition to the documentation required to be 
maintained by attesting facilities described in paragraph (d)(3) of this 
section, facilities attesting under this paragraph also shall maintain 
and make available for inspection (as described elsewhere in this 
section) such additional documentation as is necessary to substantiate 
such claim of substantial disruption.
    (3) Documentation of facility's nursing positions. The attesting 
facility shall maintain and make available for inspection (as described 
inSec. 655.350(b)) documentation substantiating:
    (i) The total number of nursing positions at the facility;
    (ii) The number of nursing vacancies at the facility during a 12-
month period ending no later than 3 months prior to submittal of the 
attestation;
    (iii) The number of nurses who left the facility during the same 12-
month period;
    (iv) The number of nurses hired by the facility during the same 12-
month period;
    (v) The overall staffing pattern for nursing positions at the 
facility; and
    (vi) A description of the facility's efforts to recruit U.S. nurses 
during the same 12-month period. The documentation on numbers of nurses, 
maintained for the purposes of this paragraph (d)(3), shall be broken 
out by numbers of U.S. nurses, nurses admitted under H-1 visas, nurses 
admitted under H-1A visas, nurses admitted under other nonimmigrant 
visas, and other nurses.
    (e) The second attestation element: no adverse effect. The facility 
shall attest that ``the employment of the alien will not adversely 
affect the wages and working conditions of registered nurses similarly 
employed.''
    (1) Wages. To meet the requirement of no adverse effect on wages, 
the facility shall attest that it shall pay each nurse of the facility 
at least the prevailing wage for the occupation in the geographic area. 
The facility shall pay the higher of the wage required pursuant to this 
paragraph (e) or the wage required pursuant to paragraph (f) of this 
section (i.e., the third attestation element: facility wage).
    (i) State employment security determination. The facility does not 
independently determine the prevailing wage. The State employment 
security agency (SESA) shall determine the prevailing wage for similarly 
employed nurses in the geographic area in accordance with administrative 
guidelines or regulations issued by ETA. The facility shall request the 
appropriate prevailing wage from the SESA not more than 90 days prior to 
the date the attestation is submitted to ETA. Once a facility obtains a 
prevailing wage determination from the SESA and files an attestation 
supported by that prevailing wage determination, the facility shall be 
deemed to have accepted the prevailing wage determination as accurate 
and appropriate (both to the occupational classification and wage) and 
thereafter shall not contest the legitimacy of the prevailing wage 
determination in an investigation or enforcement action. A facility may 
challenge a SESA prevailing wage determination through the Employment 
Service complaint system. See 20 CFR part 658, Subpart E. A facility 
which challenges a SESA prevailing wage determination shall obtain in 
final ruling from the Employment Service prior to filing an attestation. 
Any such challenge shall not require the SESA to divulge any employer 
wage data which was collected under the promise of confidentiality.
    (ii) Collectively bargained wage rates. Where wage rates for nurses 
at a facility are the result of arms-length collective bargaining, those 
rates shall be considered ``prevailing'' for that facility for the 
purposes of this subpart.
    (iii) Total compensation package. The prevailing wage finding under 
this paragraph (e)(1) relates to wages only. However, each item in the 
total compensation package for U.S., H-1A, and other nurses employed by 
the facility shall be the same within a given facility, including such 
items as housing assistance and other perquisites.
    (iv) Documentation of pay and total compensation. The facility shall 
maintain documentation summarizing its pay schedule and compensation 
package for nurses. SeeSec. 655.350(b). The

[[Page 584]]

summary shall cover each category of nursing position in which H-1A 
nurses are or will be hired or promoted into and each category of 
nursing position in which H-1A nurses (or nurses admitted on H-1 visas) 
have been hired or promoted into. Categories of nursing positions not 
covered by the documentation shall not be covered by the attestation, 
and, therefore, such positions shall not be filled or held by H-1A 
nurses.
    (2) Working conditions. To meet the requirement of no adverse effect 
on working conditions, the facility shall attest that it shall afford 
equal treatment to U.S. and H-1A nurses with the same seniority, with 
respect to such working conditions as the number and scheduling of hours 
worked (including shifts, straight days, weekends); vacations; wards and 
clinical rotations; and overall staffing-patient patterns.
    (f) The third attestation element: facility/employer wage. The 
facility employing or seeking to employ the alien shall attest that 
``the alien employed by the facility will be paid the wage rate for 
registered nurses similarly employed by the facility.'' The facility 
shall maintain documentation substantiating compliance with this 
attestation which shall include a description of the factors taken into 
consideration by the facility in making compensation decisions for 
nurses and the facility pay schedule for nurses maintained pursuant to 
paragraph (e)(1) of this section. SeeSec. 655.350(b). The facility 
shall pay the higher of the wage required pursuant to this paragraph (f) 
or the wage required pursuant to paragraph (e) of this section (i.e., 
the second attestation element: no adverse effect).
    (g) The fourth attestation element: timely and significant steps; or 
State plan. The facility may satisfy the fourth attestation element by 
satisfying Alternative I in paragraph (g)(1) of this section or by 
satisfying Alternative II in paragraph (g)(2) of this section.
    (1) Alternative I: Timely and significant steps. The facility shall 
attest that it ``has taken and is taking timely and significant steps 
designed to recruit and retain sufficient registered nurses who are 
United States citizens or immigrants who are authorized to perform 
nursing services, in order to remove as quickly as reasonably possible 
the dependence of the facility on nonimmigrant registered nurses.'' The 
facility shall take at least two such steps, unless it demonstrates that 
taking a second step is not reasonable. The steps described in this 
paragraph (g)(1) shall not be considered to be an exclusive list of the 
significant steps that may be taken to meet the conditions of this 
paragraph (g)(1). Nothing in this subpart or subpart E of this part 
shall require a facility to take more than one step, if the facility can 
demonstrate that taking a second step is not reasonable. The facility is 
not required to have taken any of these steps prior to December 18, 
1989. A facility choosing to take timely and significant steps other 
than those specifically described in paragraph (g)(1)(i)(A) of this 
section shall submit with its attestation a description of the steps it 
is proposing to take and an explanation of how the proposed steps are of 
comparable timeliness and significance to those described in paragraph 
(g)(1)(i)(A) of this section. A facility claiming that a second step is 
unreasonable shall submit an explanation of why such second step would 
be unreasonable.
    (i) Descriptions of steps--(A) Statutory steps. Each of the actions 
described in this paragraph (g)(1)(i)(A) shall be considered a 
significant step reasonably designed to recruit and retain U.S. nurses. 
A facility choosing any one of the following steps shall attest that its 
program(s) meets the regulatory requirements set forth for each and 
provide an explanation of how the requirements are satisfied by the 
program(s). In addition, the attesting facility shall maintain and make 
available for inspection (as described inSec. 655.350(b) of this part) 
documentation specified in the particular step selected and/or 
documentation which provides a complete description of the nature and 
operation of its program(s) sufficient to substantiate its attestation 
and full compliance with the requirements for the particular step 
selected. Section 212(m)(2)(E) of the INA provides that a violation 
shall be found if a facility fails to meet a condition attested to.

[[Page 585]]

Thus, a facility shall be held responsible for all timely and 
significant steps to which it attests.
    (1) Step One: ``Operating a training program for registered nurses 
at the facility or financing (or providing participation in) a training 
program for registered nurses elsewhere.'' Training programs may include 
either courses leading to a higher degree (i.e., beyond an associate or 
a baccalaureate degree), or continuing education courses. If the program 
includes courses leading to a higher degree, they shall be courses which 
are part of a program accepted for degree credit by a college or 
university and accredited by a State Board of Nursing or a State Board 
of Higher Education (or its equivalent), as appropriate. If the program 
includes continuing education courses, they shall be courses which meet 
criteria established to qualify the nurses taking the courses to earn 
continuing education units accepted by a State Board of Nursing (or its 
equivalent). In either type of program, financing by the facility, 
either directly or arranged through a third party, shall cover the total 
tuition costs of such training. The number of U.S. nurses for whom such 
training actually is provided shall be no less than half of the number 
of nurses who left the facility during the 12-month period prior to 
submission of the attestation. (U.S. nurses to whom such training was 
offered, but who rejected such training, may be counted towards those 
provided training, but the facility, in such case, shall maintain 
documentation of such offer and rejection). SeeSec. 655.350(b).
    (2) Step Two: ``Providing career development programs and other 
methods of facilitating health care workers to become registered 
nurses.'' This may include programs leading directly to a degree in 
nursing, or career ladder/career path programs which could ultimately 
lead to a degree in nursing. A facility choosing this step shall 
maintain as documentation a description of the content and eligibility 
requirements for both types of programs and an explanation of how the 
requirements of this paragraph (g)(1)(i)(A)(2) are satisfied by each 
program. Any such degree program shall be, at a minimum, either through 
an accredited community college (leading to an associate's degree), 4-
year college (a bachelor's degree), or diploma school, and the course of 
study shall be one accredited by a State Board of Nursing (or its 
equivalent). For career ladder or career path programs, the facility 
shall maintain documentation that the programs are normally part of a 
course of study or training which prepares a U.S. worker for enrolling 
in formal direct training leading to a degree in nursing, either through 
an accredited community college, a 4-year college, or a diploma school. 
SeeSec. 655.350(b) of this part. Financing by the facility, either 
directly or arranged through a third party, shall cover the total costs 
of such programs. U.S. workers participating in such programs shall be 
working or have worked in health care occupations or health care 
facilities. The number of U.S. workers for whom such training is 
provided shall be equal to no less than half the average number of 
vacancies for nurses during the 12-month period prior to the submission 
of the attestation.
    (3) Step Three: ``Paying registered nurses wages at a rate higher 
than currently being paid to registered nurses similarly employed in the 
geographic area.'' A facility choosing this step shall maintain 
documentation showing that its entire schedule of wages for nurses is at 
least 5 percent higher than the prevailing wages as determined by the 
SESA pursuant to paragraph (e)(1)(i) of this section, and it shall 
attest that such differentials shall be maintained throughout the period 
of the attestation's effectiveness.
    (4) Step Four: ``Providing adequate support services to free 
registered nurses from administrative and other non-nursing duties.'' 
Non-nursing duties include such activities as housekeeping duties; food 
preparation and delivery; transporting patients; providing occupational 
and respiratory therapy; answering telephones; running errands for 
patients; and clerical tasks. A facility choosing this step shall not 
require nurses at the facility to perform non-nursing duties. However, 
it is understood that on an infrequent non-recurring basis, nurses at 
the facility may perform one or more of the tasks encompassed by the 
duties listed above in this paragraph

[[Page 586]]

(g)(1)(i)(A)(4) or other non-nursing duties. Facilities choosing this 
step shall maintain documentation showing what steps they have taken to 
ensure that nursing jobs do not include any of these duties and that 
such activity by nurses at the facility occurs without regularity and 
infrequently. Such a facility also shall maintain documentation with 
respect to any other steps being taken to relieve nurses from non-
nursing duties, or to enhance the nursing function, such as 
computerizing certain writing and routine functions performed by nurses.
    (5) Step Five: ``Providing reasonable opportunities for meaningful 
salary advancement by registered nurses.'' Documentation for this step 
shall include documentation of systems for salary advancement based on 
factors such as merit, education, and specialty, and/or salary 
advancement based on length of service with other bases for wage 
differentials remaining constant.
    (i) Merit, education, and specialty. For salary advancement based on 
factors such as merit, education, and specialty, the facility shall 
maintain and make available for inspection documentation that it 
provides opportunities for professional development of its nurses which 
lead to salary advancement, e.g., opportunities for continuing 
education; in-house educational instruction; special committees, task 
forces, or projects considered of a professional development nature; 
participation in professional organizations; and writing for 
professional publications. Such opportunities shall be available to all 
the facility's nurses.
    (ii) Length of service. For salary advancement based on length of 
service, the facility shall maintain and make available for inspection 
documentation that it has clinical ladders in place which provide, 
annually, salary increases of 3 percent or more for a period of no less 
than 10 years, over and above the costs of living and merit, education, 
and specialty increases and differentials.
    (B) Other possible steps. The Act indicates that the five steps 
described in paragraphs (g)(1)(i)(A) (1) through (5) of this section are 
not an exclusive list of timely and significant steps which might 
qualify. Facilities are encouraged to be innovative in devising other 
timely and significant steps, but these shall be of timeliness and 
significance comparable to those in paragraphs (g)(1)(i)(A) (1) through 
(5) of this section to qualify. A facility may attest that it has taken 
and is taking other such steps and explain in its attestation what these 
steps are, their nature and scope, how they are effected and how they 
meet the statutory test of timeliness and significance comparable to 
those Steps One through Five described above. A facility choosing 
alternative steps shall attest that its program(s) meet(s) the statutory 
requirements of timeliness and significance in promoting the 
development, recruitment and retention of U.S. nurses, explaining how 
these requirements are satisfied by such program(s). In addition, the 
attesting facility shall maintain and make available for inspection (as 
described inSec. 655.350(b)) documentation which provides a complete 
description of the nature and operation of its program(s) sufficient to 
substantiate its attestation and full compliance with the requirements 
of this paragraph (g)(1)(i)(B). Examples of such steps which--depending 
on the circumstances, the size and nature of the attesting facility, the 
nature and scope of the step(s) described, the number of persons 
affected, and other such factors--may meet these requirements are:
    (1) Monetary incentives--providing monetary incentives to nurses, 
through bonuses and merit pay plans not included in the base 
compensation package, for additional education, and for efforts leading 
to increased recruitment and retention of U.S. nurses. Such monetary 
incentives can be based on actions by nurses such as: Innovations to 
achieve better patient care, increased productivity, reduced waste, 
better safety; obtaining additional certification in a nursing 
specialty; unused sick leave; recruiting other U.S. nurses; staying with 
the facility for a given number of years; taking less desirable 
assignments (other than shift differential); participating in 
professional organizations, on task forces and on special committees; or 
contributing to professional publications. Facilities attesting to this 
step shall have

[[Page 587]]

a documented system for providing significant financial rewards in the 
form of bonuses or salary advancement to nurses participating in the 
activities described in this paragraph.
    (2) Special perquisites--providing nurses with special perquisites 
for dependent care or housing assistance of a nature and/or extent that 
constitute a ``significant'' factor in inducing employment and retention 
of U.S. nurses.
    (3) Work schedule options--providing nurses with non-mandatory work 
schedule options for part-time work, job-sharing, compressed work week 
or non-rotating shifts (provided, however, that H-1A nurses are employed 
only in full-time work) of a nature and/or extent that constitute a 
``significant'' factor in inducing employment and retention of U.S. 
nurses.
    (4) Other training options--providing training opportunities to 
become registered nurses to U.S. workers not currently in health care 
occupations by means of financial assistance (e.g., scholarship, loan or 
pay-back programs) to such persons.
    (ii) Unreasonableness of second step. The steps described in this 
paragraph (g)(1) shall not be considered to be an exclusive list of the 
significant steps that may be taken to meet the conditions of this 
paragraph (g)(1). Nothing in this subpart or subpart E of this part 
shall require a facility to take more than one step, if the facility can 
demonstrate that taking a second step is not reasonable. However, a 
facility shall make every effort to take at least two steps. A facility 
taking only one step shall provide an explanation with its attestation, 
and maintain documentation at the facility, relating to why taking a 
second step is not reasonable. The taking of a second step may be 
considered unreasonable if it would result in the facility's financial 
inability to continue providing the same quality and quantity of health 
care or if the provision of nursing services would otherwise be 
jeopardized by the taking of such a step. If the single step which is 
taken is one of the statutorily defined steps described in paragraphs 
(g)(1)(i)(A)(1) through (g)(1)(i)(A)(5) of this section, the facility 
shall explain with its attestation, and maintain documentation at the 
facility, with respect to each of the four statutory steps (described in 
paragraphs (g)(1)(i)(A)(1) through (g)(1)(i)(A)(5) of this section) not 
taken, relating to why it would be unreasonable for the facility to take 
such step and also shall explain with its attestation, and shall 
maintain and make available for inspection (as described inSec. 
655.350(b)) documentation demonstrating why it would be unreasonable for 
the facility to take any other steps designed to recruit, develop and 
retain sufficient U.S. nurses to meet its staffing needs. If the single 
step which is taken is not one of the five statutory steps described in 
paragraphs (g)(1)(i)(A)(1) through (g)(1)(i)(A)(5) of this section, the 
facility shall, with respect to each of the five statutory steps not 
taken, explain with its attestation, and maintain documentation and make 
available for inspection (as described inSec. 655.350(b)) 
documentation, demonstrating why it would be unreasonable for the 
facility to take such step; the facility also shall explain with its 
attestation, and make available for inspection (as described inSec. 
655.350(b)) documentation demonstrating why it would be unreasonable for 
the facility to take any other steps designed to recruit and retain 
sufficient U.S. nurses to meet its staffing needs. On the basis of the 
explanation submitted by the facility, the Certifying Officer shall 
determine whether the requirements of this paragraph (g)(1)(ii) have 
been met. See paragraph (m) of this section regarding such 
determinations and administrative appeals therefrom.
    (iii) Alternative to criteria for each specific step. Instead of 
complying with the specific criteria for each of the steps in the second 
and succeeding years, a facility may include in its prior year's 
attestation, in addition to the actions taken under Steps One through 
Five, that it shall reduce the number of alien (H-1 and H-1A 
visaholders) nurses it utilizes within 1 year from the date of 
attestation by at least 10 percent, without reducing the quality or 
quantity of services provided. If this goal is achieved (as demonstrated 
by documentation maintained by the facility and made available for 
inspection, and indicated in its subsequent year's attestation), the 
facility's subsequent

[[Page 588]]

year's attestation may simply include the Form ETA 9029, an explanation 
demonstrating that this goal has been achieved and an attestation that 
it shall again reduce the number of alien nurses it utilizes within 1 
year from the date of attestation by at least 10 percent. This 
alternative is designed to permit a facility to achieve the objectives 
of the Act, without subjecting the facility to detailed requirements and 
criteria as to the specific means of achieving that objective. The 
first, second, and succeeding years shall be consecutive.
    (2) Alternative II: subject to approved annual State plan. As an 
alternative to attesting to the timely and significant steps set forth 
in paragraph (g)(1) of this section, the facility may attest that it 
``is subject to an approved State plan for the recruitment and retention 
of nurses.'' The contents of the annual State plan are described in more 
detail inSec. 655.315. For an individual facility to meet the 
requirements of this paragraph (g)(2), the annual State plan shall 
provide for the taking of timely and significant steps by that facility, 
and the facility shall maintain appropriate documentation with respect 
to those steps. SeeSec. 655.350(b). To qualify for this Alternative 
II, the annual State plan shall have been approved prior to the date the 
facility submits its attestation to ETA for filing.
    (h) The fifth attestation element: No strike or lockout; no 
intention or design to influence bargaining representative election. The 
facility shall attest that ``there is not a strike or lockout in the 
course of a labor dispute, and the employment of such an alien is not 
intended or designated to influence an election for a bargaining 
representative for registered nurses of the facility.'' Labor disputes 
for purposes for this attestation element relate only to those involving 
nurses providing nursing services; other health service occupations are 
not included. This attestation element applies to strikes and lockouts 
and elections of bargaining representatives at both the facility 
employing the nurse and, in the case of nursing contractors, at the 
worksite facility.
    (1) Notice of strike or lockout. In order to remain in compliance 
with the no strike or lockout portion of this attestation element, if a 
strike or lockout of nurses at the facility occurs during the 1 year's 
validity of the attestation, the facility, within 3 days of the 
occurrence of the strike or lockout, shall submit to the ETA National 
Office, by U.S. mail or private carrier, written notice of the strike or 
lockout.
    (2) ETA notice to INS. Upon receiving from a facility a notice 
described in paragraph (h)(1) of this section, ETA shall examine the 
documentation, and may consult with the union at the facility or other 
appropriate entities. If ETA determines that the strike or lockout is 
covered under 8 CFR 214.2(h)(17), INS's Effect of strike regulation for 
``H'' visaholders, ETA shall certify to INS, in the manner set forth in 
that regulation, that a strike or other labor dispute involving a work 
stoppage of nurses is in progress at the facility.
    (i) The sixth attestation element: notice of filing. The facility 
shall attest that at the time of filing of the petition for registered 
nurses under section 101(a)(15)(H)(i)(a) of the Act, notice of filing 
has been provided by the facility to the bargaining representative of 
the registered nurses at the facility or, where there is no such 
bargaining representative, notice of the filing has been provided to 
registered nurses at the facility through posting in conspicuous 
locations. The requirement applies to providing notice of filing both 
for attestations submitted to ETA and for visa petitions filed with INS.
    (1) Notification of bargaining representative. No later than the 
date the attestation is mailed to DOL to be considered for filing, the 
facility shall notify the bargaining representative (if any) for nurses 
at the facility that the attestation is being submitted to DOL, and 
shall state in that notice that the attestation is available at the 
facility (explaining how it can be inspected or obtained) and at the 
national office of ETA for review by interested parties. No later than 
the date the facility transmits a visa petition for H-1A nurses to INS, 
the facility shall notify the bargaining representative (if any) for 
nurses at the facility that the visa petition is being submitted to INS, 
and

[[Page 589]]

shall state in that notice that the attestation and visa petition are 
available at the facility (explaining how they can be inspected or 
obtained) and at the national office of ETA for review by interested 
parties. Notices under this paragraph (i)(1) shall include the following 
statement: ``Complaints alleging misrepresentation of material facts in 
the attestation or failure to comply with the terms of the attestation 
may be filed with any office of the Wage and Hour Division of the United 
States Department of Labor.''
    (2) Posting notice. If there is no bargaining representative for 
nurses at the facility, when the facility submits and attestation to 
ETA, and each time the facility files an H-1A visa petition with INS, 
the facility shall post a written notice at the facility (and, in 
addition, at the worksite facility, if at a different location, such as 
in the case of nursing contractors), stating that the attestation and/or 
visa petition(s) have been filed and are available at the facility 
(explaining how these documents can be inspected or obtained) and at the 
national office of ETA for review by interested parties. In order for 
the facility to remain in compliance with this paragraph (i)(2), all 
such notices shall remain posted during the validity period of the 
attestation and the attestations and petitions shall be available for 
examination at the facility throughout this period of time. The notice 
of posting shall provide information concerning the availability of 
these documents for examination at the facility and at the national 
office of ETA, and shall include the following statement: ``Complaints 
alleging misrepresentation of material facts in the attestation or 
failure to comply with the terms of the attestation may be filed with 
any office the Wage and Hour Division of the United States Department of 
Labor.'' Such posted notices shall be clearly visible and unobstructed 
while posted, shall be posted in conspicuous places, where the 
facility's U.S. nurses readily can read the posted notice on the way to 
or from their duties. Appropriate locations for posting such notices 
include locations in the immediate proximity of mandatory Fair Labor 
Standards Act wage and hour notices and Occupational Safety and Health 
Act occupational safety and health notices.
    (j) Special provisions for nursing contractors. A nursing contractor 
submitting an attestation for filing as a facility shall attest, in 
addition to the first through sixth attestation elements, that it will 
refer H-1A nurses only to facilities that (with the exception of private 
households which themselves do not employ H-1A nurses) have valid 
attestations on file with ETA. The nursing contractor shall obtain from 
each such worksite facility a copy of that facility's Form ETA 9029, 
accepted for filing by ETA and then currently on file with ETA. The 
nursing contractor shall maintain a copy of such worksite facility's 
accepted attestation on file at the nursing contractor's principal 
office during the validity period of the nursing contractor's 
attestation or the period of time that any H-1A nurse in its employ is 
providing nursing services at the worksite facility, whichever is 
longer.
    (k) Special provisions for worksite facilities which are not 
employers of H-1A nurses and are not controlled by employers of H-1A 
nurses. A facility (other than a private household) which obtains the 
services of an H-1A nurse by contracting with a nursing contractor, but 
which is itself neither the employer of any H-1A nurse nor controlled by 
the employer of any H-1A nurse (see paragraph (k)(1) of this section), 
shall file an attestation with ETA pursuant to this subpart. Such a 
worksite facility may request from ETA a waiver of specific elements of 
the attestation to avoid duplicative attestations, in cases of 
temporary, emergency circumstances, with respect to information not 
within the knowledge of the attestor, or for other good cause. The 
attesting worksite facility shall be to ably demonstrate the existence 
of the circumstances or good cause which are asserted as the basis(es) 
for the request for a waiver of a particular element of the attestation, 
but need not submit such evidence with its request for waiver, except 
evidence with respect to a bona fide medical emergency (see paragraph 
(k)(3)(iii) of this section).
    (1) Worksites employing, seeking to employ, or filing visa petitions 
on behalf of

[[Page 590]]

H-1A nurses. An attestation with respect to which waiver is requested or 
granted pursuant to this paragraph (k) is not valid (i.e., is not ``on 
file and in effect'') for a worksite facility employing, seeking to 
employ, or filing a visa petition on behalf of H-1A nurses. Only an 
attestation meeting the requirements of paragraphs (a) through (i) of 
this section (and paragraph (j) of this section, in the case of a 
nursing contractor) can serve as the basis for a petition for an H-1A 
visa. A worksite facility which uses H-1A nurses only through a nursing 
contractor and, as part of its attestation, requests waiver of one or 
more attestation elements nevertheless shall file a complete attestation 
in order to be able to use such attestation as a basis for itself filing 
a visa petition for an H-1A nurse. Thus, a worksite facility should 
consider its future needs for H-1A nurses in filing attestations and 
requests for waiver pursuant to this paragraph (k).
    (2) Inapplicability of third attestation element: facility/employer 
wage. If a worksite facility uses H-1A nurses only through a nursing 
contractor, the third attestation element (facility/employer wage; see 
paragraph (f) of this section) is not applicable to that facility, since 
the worksite facility is not the employer of the H-1A nurse and does not 
guarantee the H-1A nurse's wage. The third attestation element is 
required only for the employer of the H-1A nurse(s), i.e., the third 
attestation element shall be included in the attestation of and met by 
the H-1A nurse's employer (i.e., the nursing contractor).
    (3) Waiver of attestation elements. ETA may consider, pursuant to 
this paragraph (k)(3) requests for waiver of certain attestation 
elements by a worksite facility which uses or will use an H-1A nurse 
provided by a nursing contractor (i.e., an ``H-1A contract nurse''), but 
which worksite facility itself does not employ, seek to employ, or file 
a visa petition on behalf of an H-1A nurse. Paragraphs (k)(3) (i) 
through (iii) of this section set forth different conditions for waiver 
depending on the number of workdays of H-1A contract nurse services the 
worksite facility will use. For the purposes of this paragraph (k)(3), a 
``workday'' shall consist of one H-1A contract nurse working for one 
normal shift in a day. Thus, for example, three normal shifts worked by 
each of a group of five H-1A contract nurses totals 15 workdays.
    (i) Minimal use of H-1A contract nurses by a worksite. Where the 
attesting worksite facility attests in its request for waiver pursuant 
to this paragraph (k)(3) that it will use no more than a total of 15 
workdays of H-1A contract nurse services in any 3-month period of the 
attestation's 1-year period of validity to meet emergency needs on a 
temporary basis, ETA may waive the first (substantial disruption), 
second (adverse effect), and fourth (timely and significant steps or 
State plan) elements of the attesting worksite facility's attestation. 
See paragraphs (d), (e), and (g) of this section; see also paragraphs 
(f) and (k)(2) of this section, with respect to the inapplicability of 
third attestation element (facility/employer wage). ETA shall not waive 
pursuant to this paragraph (k)(3)(i) the fifth attestation element 
(strike, lockout, or intent or design to influence bargaining 
representative election) or the sixth attestation element (notice). See 
paragraphs (h) and (i) of this section.
    (ii) Short-term use of H-1A contract nurses. Where the attesting 
worksite facility attests in its request for waiver pursuant to this 
paragraph (k)(3) that it will use no more than a total of 60 workdays of 
H-1A contract nurse services in any 3-month period of the attestation's 
1-year period of validity to meet temporary needs, ETA may waive the 
nursing shortage component of the first element (substantial disruption; 
see paragraphs (d)(2) and (d)(3) of this section) and may waive the 
fourth (timely and significant steps or State plan; see paragraph (g) of 
this section) element of the attesting worksite facility's attestation. 
See also paragraphs (f) and (k)(2) of this section, with respect to the 
inapplicability of third attestation element (facility/employer wage). 
ETA shall not waive pursuant to this paragraph (k)(3)(ii) the no-layoff 
component of the first attestation element (substantial disruption; see 
paragraph (d)(1) of this section); the second attestation element 
(adverse effect); the fifth attestation element (strike, lockout, or 
intent to influence

[[Page 591]]

a bargaining representative election); or the sixth attestation element 
(notice). See paragraphs (d), (e), (h), and (i) of this section.
    (iii) Long-term use of H-1A contract nurse services. Where the 
attesting worksite facility attests in its request for waiver pursuant 
to this paragraph (k)(3) that it will use more than 60 workdays of H-1A 
contract nurse services in any 3-month period of the attestation's 1-
year period of validity, ETA shall not waive any attestation element, 
except that, if the attestor documents a bona fide medical emergency 
warranting a waiver of the fourth attestation element (timely and 
significant steps or State plan) ETA may waive such element. See 
paragraph (g) of this section.
    (l) Agents of worksite facilities. A worksite facility (including a 
worksite facility which itself employs or seeks to employ an H-1A nurse) 
may authorize a nursing contractor to act as its agent in preparing and 
filing the worksite facility's attestation; however, a worksite facility 
using an agent for preparation and filing of the attestation is 
responsible for the contents of such attestation and remains liable for 
any violations which may be disclosed in any investigation under Subpart 
E of this Part, and the chief executive officer of the worksite facility 
shall sign the original attestation, as required by paragraph (c)(1)(i) 
of this section.
    (m) Actions on attestations submitted for filing. An attestation 
which meets the established criteria set forth in thisSec. 655.310 
shall be accepted for filing by ETA on the date it is signed by the 
Certifying Officer. ETA shall then follow the procedures set forth in 
paragraph (m)(1) of this section. An attestation submitted by a facility 
proposing alternative criteria or steps for the first and/or the fourth 
attestation elements, and/or proposing to take only one timely and 
significant step, and/or claiming a bona fide medical emergency 
exemption from the fourth attestation element shall be reviewed by ETA, 
and a determination shall be made by the Certifying Officer whether to 
accept or reject the attestation for filing. See paragraphs (d)(2)(ii), 
(g)(1)(i)(B), (g)(1)(ii), and (k)(3)(iii) of this section. The 
Certifying Officer may request additional explanation and/or 
documentation from the facility in making this determination. If the 
Certifying Officer does not contact the facility for such information or 
make any determination within 30 days of receiving the attestation, the 
attestation shall become accepted for filing. Upon the facility's 
submitting the attestation to ETA and providing the notice required by 
the sixth attestation element (seeSec. 655.310(i)), the attestation 
shall be available for public examination at the health care facility 
itself. When ETA accepts the attestation for filing, the Certifying 
Officer shall forward the attestation to the ETA National Office, where 
it shall be available for public examination. Information contesting an 
attestation received by ETA prior to the determination to accept or 
reject the attestation for filing shall not be made part of ETA's 
administrative record on the attestation, but shall be referred to ESA 
to be processed as a complaint pursuant to Subpart E of this part, and, 
if such attestation nevertheless is accepted by ETA for filing, the 
complaint will be handled by ESA under that subpart.
    (1) Acceptance. (i) If the attestation (and any explanatory 
statements that may be required) meet the requirements of this subpart, 
ETA shall accept the attestation for filing, shall, in the case of a 
facility intending to file a visa petition as the employer of an H-1A 
nurse, notify INS in writing of the filing, shall return to the facility 
one copy of the attestation form submitted by the facility, with ETA's 
acceptance indicated thereon, and shall forward one copy of the 
attestation with ETA's acceptance indicated thereon to the ETA National 
Office. The facility may then file a visa petition with INS for alien 
nurses in accordance with INS regulations.
    (ii) DOL is not the guarantor of the accuracy, truthfulness or 
adequacy of an attestation accepted for filing.
    (2) Appeals of acceptances. If an attestation which is subject to a 
determination under paragraph (d)(2)(ii), (g)(1)(i)(B), (g)(1)(ii), or 
(k)(3)(iii) of this section is accepted for filing, any interested party 
may appeal ETA's determination(s) on the element(s) that

[[Page 592]]

have been reviewed. Appeals of acceptances shall be filed with the 
BALCA, no later than 30 days after the date of acceptance, and will be 
considered under the procedures set forth atSec. 655.320.
    (3) Appeals of rejections. If the attestation is not accepted for 
filing, which may occur as a result of a determination under paragraph 
(d)(2)(ii), (g)(1)(i)(B), (g)(1)(ii), or (k)(3)(iii) of this section, 
ETA shall notify the facility in writing, specifying the reasons for 
rejection and quoting the language ofSec. 655.320(a)(1). Any 
interested party may appeal such rejection to the BALCA, no later than 
30 days after the date of rejection. Appeals of rejections shall be 
filed and considered under the procedures set forth atSec. 655.320.
    (n) Effective date and validity of filed attestations. An 
attestation becomes filed and effective as of the date it is accepted 
and signed by the Certifying Officer and accepted thereby for filing. 
Such attestation is valid for the 12-month period beginning on the date 
of acceptance for filing, unless suspended or invalidated pursuant to 
Sec.  655.320 or subpart E. The filed attestation expires at the end of 
the 12-month period of validity.
    (o) Suspension or invalidation of filed attestation. Suspension or 
invalidation of an attestation may result from a BALCA decision 
reversing an ETA acceptance for filing; from investigations by the 
Administrator, Wage and Hour Division, of the facility's 
misrepresentation in or failure to carry out its attestation; or from a 
discovery by ETA that it made an error in its review of the attestation 
(in those cases where ETA performs such review pursuant to paragraph 
(d)(2)(ii), (g)(1)(i)(B), (g)(1)(ii), (k)(3)(iii) of this section) and 
that the explanation and documentation provided and maintained by the 
facility does not or did not meet the criteria set forth atSec. 
655.310 (a) through (k). If an attestation is suspended or invalidated, 
DOL shall notify INS.
    (1) Result of BALCA or Wage and Hour Division action. If an 
attestation is suspended or invalidated as a result of a BALCA decision 
overruling an acceptance of the attestation for filing, or is suspended 
or invalidated as a result of a Wage and Hour Division action pursuant 
to subpart E, such suspension or invalidation may not be separately 
appealed, but shall be merged with appeals of BALCA's or the Wage and 
Hour Division's determination on the underlying violation.
    (2) Result of ETA action. If, after accepting an attestation for 
filing, ETA discovers that it erroneously accepted that attestation for 
filing, and, as a result, ETA suspends or invalidates that acceptance, 
the facility may appeal such suspension or invalidation pursuant to 
Sec.  655.320 as if that suspension or invalidation were a decision to 
reject the attestation for filing.
    (p) Facility's responsibilities during suspension and after 
invalidation or expiration of filed attestation. A facility shall comply 
with the terms of its attestation, even if such attestation is 
suspended, invalidated, or expired, as long as any H-1A nurse is at the 
facility, unless the attestation is superseded by a subsequent 
attestation accepted for filing by ETA.
    (q) Facilities subject to penalties. No attestation shall be 
accepted for filing from a nursing contractor or other facility which 
has failed to comply with any penalty, sanction, or other remedy 
assessed in a final agency action following an investigation by the Wage 
and Hour Division pursuant to subpart E.

(Approved by the Office of Management and Budget under control number 
1205-0305)

[59 FR 882, 897, Jan. 6, 1994, as amended at 59 FR 5487, Feb. 4, 1994]



Sec.  655.315  State plans.

    A State may submit an annual plan for the recruitment and retention 
of U.S. citizens and permanent resident aliens who are authorized to 
perform nursing services in the State.
    (a) Who should prepare and file the annual plan? The Governor of 
each State that chooses to submit an annual State plan shall be 
responsible for the preparation and filing of the annual plan. The 
Governor may designate any public and/or private organization(s) to 
assist the Governor in the development of the annual plan.
    (b) When and where should the annual plan be filed? If a State 
determines to file an annual State plan, the Governor shall submit the 
original plan, signed

[[Page 593]]

by the Governor, by U.S. mail or private carrier, to ETA at the 
following address: Director, U.S. Employment Service, Employment and 
Training Administration, Department of Labor, 200 Constitution Avenue, 
NW., room N-4456, Washington, DC 20210. An annual State plan may be 
filed with ETA at any time. However, for an individual facility 
legitimately to attest to being subject to an annual State plan for the 
purposes of the fourth attestation element, Alternative II (seeSec. 
655.310(g)(2)), such annual State plan shall have been approved prior to 
the date the attestation was submitted to ETA for filing and be in 
current effect. Therefore, if the Governor is aware that a facility 
within the State plans to submit an attestation for filing with ETA, the 
annual State plan should be mailed to ETA at least 35 days prior to the 
facility's submission of its attestation to ETA.
    (c) What overall issues shall the annual State plan address? The 
annual State plan shall address the overall issue of supply of and 
demand for nurses within the State, with particular emphasis on measures 
to develop a sufficient supply of U.S. nurses to meet projected demand. 
The State, as opposed to individual facilities, is in a position to--and 
may be expected to--address broad issues and perform such functions as 
conducting a Statewide needs assessment; overall management, 
facilitation and coordination among various interested entities within 
the State; and undertaking more regionally based approaches. The State 
is also in a position to devote resources which individual facilities 
may be lacking.
    (d) How should the annual State plan address the timely and 
significant steps? The annual State plan shall address all of the timely 
and significant steps inSec. 655.310(g)(1)(i)(A)(1) through 
(g)(1)(i)(A)(5) generically, without regard to the specific criteria 
therein, on a Statewide basis. However, for the annual State plan to 
satisfy Alternative II of the fourth attestation requirement for an 
individual facility (seeSec. 655.310(g)(2)), the annual State plan 
shall indicate which of those timely and significant steps relate to 
individual facilities, and that each individual facility shall take such 
a step (either one step or more, as appropriate) to meet the appropriate 
specific criteria as set forth inSec. 655.310(g)(1).
    (e) What other components may the annual State plan include? An 
annual State plan may include the following components:
    (1) The cooperation of high schools and colleges may be enlisted in 
counseling health workers and other individuals to enter the nursing 
profession.
    (2) Geographic and salary data may be made available to assist in 
linking nurses to facilities.
    (3) Publications of vacancies and programs may be made in industry 
and State newsletters.
    (4) Training films and videotapes, as well as information on housing 
and relocation services, may be developed and distributed.
    (5) Measures may be taken to encourage other health professionals to 
become nurses, such as: setting up home study programs with State 
licensing boards to allow work credits for purposes of meeting 
educational or State clinical requirements; entering into cooperative 
agreements for providing health care insurance and other job-related 
elements which would allow greater flexibility for those attempting to 
combine careers and school; providing monetary grants or long-term loans 
to persons preparing to become nurses.
    (6) Steps may be taken to encourage nurses who have left the nursing 
field to return to nursing, by providing such inducements as child care, 
holiday schedule adjustments, and substantial salary increases.
    (7) The State may profile and publicize those facilities with 
special model programs.
    (8) The annual State plan may place demands on facilities for 
comprehensive plans to reduce reliance on foreign nurses.
    (f) Approval and disapproval of annual State plans. Determinations 
of approval and disapproval of annual State plans shall be made by the 
Director, USES. The annual State plan shall be reviewed by ETA, in 
consultation with the Department of Health and Human Services, and a 
determination to approve or disapprove the annual State

[[Page 594]]

plan made within 30 calendar days of ETA's receipt of the plan.
    (1) If the annual State plan is approved, the Director shall notify 
the Governor in writing.
    (2) If the annual State plan is disapproved, the Director shall 
notify the Governor in writing, specifying the reason(s) for 
disapproval. The notice shall state that within 30 calendar days of the 
date of the notice of disapproval, the Governor may correct the 
deficiencies noted in the disapproval and resubmit the annual State plan 
to ETA; and shall inform the state of its right to an appeal, by quoting 
the language ofSec. 655.320(a).
    (g) An approved annual State plan shall be valid for 12-month period 
beginning on the date of its approval by DOL.

(Approved by the Office of Management and Budget under control number 
1205-0305)



Sec.  655.320  Appeals of acceptance and rejection of attestations
submitted for filing and of State plans.

    (a) Appeal right--(1) Attestations; when to file appeals from 
acceptances and rejections. On the basis that the explanation and 
documentation provided and maintained by the facility does not or did 
not meet the criteria set forth atSec. 655.310(d)(2)(ii), 
(g)(1)(i)(B)(5), (g)(1)(ii), or (k)(3)(iii), an interested party may 
appeal an acceptance or rejection by ETA of an attestation submitted by 
a facility for filing in those cases where DOL performed an attestation 
review function under those provisions. The appeal shall be limited to 
ETA's determinations on the element(s) reviewed and shall not be an 
appeal as to any other element(s) in the attestation. An interested 
party may also appeal ETA's invalidation or suspension of a filed 
attestation due to a discovery by ETA that it made an error in its 
reviewing of the attestation (seeSec. 655.310(o). In the case of an 
appeal of an acceptance, the facility shall be a party to the appeal; in 
the case of the appeal of a rejection, invalidation, or suspension, the 
collective bargaining representative (if any) representing nurses at the 
facility shall be a party to the appeal. Appeals shall be in writing; 
shall set forth the grounds for the appeal; shall state if de novo 
consideration by BALCA is requested; and shall be mailed by certified 
mail within 30 calendar days of the date of the action from which the 
appeal is taken (i.e., the acceptance, rejection, suspension or 
invalidation of the attestation).
    (2) Annual State plans; when to file appeals from disapprovals. A 
Governor of a State may appeal ETA's disapproval of an annual State 
plan. Individual facilities in the State may file briefs as amici 
curiae. Appeals shall be in writing and shall be mailed by certified 
mail within 30 calendar days of the disapproval of the annual State 
plan.
    (3) Where to file appeals. Appeals made pursuant to this section 
shall be in writing and shall be mailed by certified mail to: Director, 
U.S. Employment Service, Employment and Training Administration, 
Department of Labor, 200 Constitution Avenue, NW., Room N-4456, 
Washington, DC 20210.
    (4) Complaints. Appeals under this paragraph (a) shall not encompass 
questions of misrepresentation by a health care facility or 
nonperformance by such a facility of its attestation. Such complaints 
shall be filed with an office of the Wage and Hour Division, United 
States Department of Labor.
    (b) Transmittal to BALCA; case file. Upon receipt of an appeal 
pursuant to this section, the Certifying Officer (or, in the case of 
State plans, the Director, USES), shall send to BALCA a certified copy 
of the ETA case file, containing the attestation and supporting 
documentation and any other information or data considered by ETA in 
taking the action being appealed. The administrative law judge chairing 
BALCA shall assign a panel of one or more administrative law judges who 
serve on BALCA to review the record for legal sufficiency and to 
consider and rule on the appeal.
    (c) Consideration on the record; de novo hearings--(1) General. 
BALCA shall not remand, dismiss, or stay the case, except as provided in 
paragraph (c)(2) of this section, but may otherwise consider the appeal 
on the record or in a de novo hearing (on its own motion or on a party's 
request). Interested parties and amici curiae may submit briefs in 
accordance with a schedule set by BALCA. The ETA official making the 
determination from which the appeal

[[Page 595]]

was taken shall be represented by the Associate Solicitor for Employment 
and Training Legal Services, Office of the Solicitor, Department of 
Labor, or the Associate Solicitor's designee. If BALCA determines to 
hear the appeal on the record without a de novo hearing, BALCA shall 
render a decision within 30 calendar days after BALCA's receipt of the 
case file. If BALCA determines to hear the appeal through a de novo 
hearing, the procedures contained in 29 CFR part 18 shall apply to such 
hearings, except that:
    (i) The appeal shall not be considered to be a complaint to which an 
answer is required;
    (ii) BALCA shall ensure that, at the request of the appellant, the 
hearing is scheduled to take place within a reasonable period after 
BALCA's receipt of the case file (see also the time period described in 
paragraph (c)(1)(iv) of this section);
    (iii) Technical rules of evidence, such as the Federal Rules of 
Evidence and subpart B of the Rules of Practice and Procedure for 
Administrative Hearings Before the Office of Administrative Law Judges 
(29 CFR part 18, subpart B), shall not apply to any hearing conducted 
pursuant to this subpart, but rules or principles designed to assure 
production of the most credible evidence available and to subject 
testimony to test by cross-examination shall be applied where reasonably 
necessary by BALCA in conducting the hearing; BALCA may exclude 
irrelevant, immaterial, or unduly repetitious evidence; the certified 
copy of the case file transmitted to BALCA by the Certifying Officer 
(or, in the case of State plans, the Director, USES), shall be part of 
the evidentiary record of the case and need not be removed into 
evidence; and
    (iv) BALCA's decision shall be rendered within 120 calendar days 
after BALCA's receipt of the case file.
    (2) Dismissals and stays. If the BALCA determines that the appeal is 
solely a question of misrepresentation by the facility or is solely a 
complaint of the facility's nonperformance of the attestation, BALCA 
shall dismiss the case and refer the matter to the Administrator, Wage 
and Hour Division, for action under subpart E. If the BALCA determines 
that the appeal is partially a question of misrepresentation by the 
facility or is partially a complaint of the facility's nonperformance of 
the attestation, BALCA shall refer the matter to the Administrator, Wage 
and Hour Division, for action under Subpart E of this part and shall 
stay BALCA consideration of the case pending final agency action on such 
referral. During such stay, the 120-day period described in paragraph 
(c)(1)(iv) of this section shall be suspended.
    (d) BALCA's decision. After consideration on the record or a de novo 
hearing, BALCA shall either affirm or reverse ETA's decision, and shall 
so notify the appellant; the Director, if the affirmation or denial 
involves a State plan; Certifying Officer; Chief, Division of Foreign 
Labor Certifications; and any other parties. SeeSec. 655.450 custody 
of the record of the appeal.
    (e) Decisions on attestations. With respect to an appeal of the 
acceptance, rejection, suspension or invalidation of an attestation, the 
decision of BALCA shall be the final decision of the Secretary, and no 
further review shall be given to the matter by any DOL official.
    (f) Decisions on annual State plans. With respect to an appeal of 
the disapproval of an annual State plan, the decision of BALCA shall be 
the final decision by the Secretary, unless a petition for review of the 
BALCA decision is filed with the Secretary and the Secretary determines 
to review the decision.
    (1) Filing of petition for review. The Director or the State 
desiring review of the decision and order of BALCA may petition the 
Secretary to review the decision and order. To be effective, such 
petition shall be received by the Secretary within 30 days of the date 
of the decision and order. Copies of the petition shall be served on all 
parties and on BALCA.
    (2) Form of petition for review. No particular form is prescribed 
for any petition for Secretary's review permitted by this paragraph (f). 
However, any such petition shall:
    (i) Be dated;
    (ii) Be typewritten or legibly written;

[[Page 596]]

    (iii) Specify the issue or issues stated in the BALCA decision and 
order giving rise to such petition;
    (iv) State the specific reason or reasons why the party petitioning 
for review believes such decision and order are in error;
    (v) Be signed by the party filing the petition or by an authorized 
representative of such party;
    (vi) Include the address at which such party or authorized 
representative desires to receive further communications relating 
thereto; and
    (vii) Attach copies of BALCA's decision and order, and any other 
record documents which would assist the Secretary in determining whether 
review is warranted.
    (3) Notice of determination to review. Whenever the Secretary 
determines to review the decision and order of BALCA on an annual State 
plan, a notice of the Secretary's determination to do so shall be served 
upon BALCA and upon all parties to the proceeding within 30 days after 
the Secretary's receipt of the petition for review.
    (4) Hearing record. Upon receipt of the Secretary's notice, BALCA 
shall within 15 days forward the complete hearing record to the 
Secretary.
    (5) Contents of Secretary's notice. The Secretary's notice shall 
specify:
    (i) The issue or issues to be reviewed;
    (ii) The form in which submissions shall be made by the parties; and
    (iii) The time within which such submissions shall be made.
    (6) Filing of documents. All documents submitted to the Secretary 
pursuant to this paragraph (f) shall be filed with the Secretary of 
Labor, U.S. Department of Labor, Washington, DC 20210, Attention: 
Executive Director, Office of Administrative Appeals, Room S-4309. An 
original and two copies of all documents shall be filed. Documents are 
not deemed filed with the Secretary until actually received by the 
Secretary. All documents, including documents filed by mail, shall be 
received by the Secretary either on or before the due date.
    (7) Service of documents. Copies of all documents filed with the 
Secretary pursuant to this paragraph (f) shall be served simultaneously 
upon all other parties involved in the proceeding. Service upon the 
Director shall be in accordance with paragraph (a)(3) of this section.
    (8) Secretary's decision. The Secretary's final decision pursuant to 
this paragraph (f) shall be issued within 180 days from the date of the 
notice of intent to review. The Secretary's decision shall be served 
upon all parties and BALCA.
    (9) Transmittal of record. Upon issuance of the Secretary's decision 
under this paragraph (f), the Secretary shall transmit the entire record 
to the Chief Administrative Law Judge for custody pursuant toSec. 
655.450.



Sec.  655.350  Public access.

    (a) Public examination at ETA. ETA shall make available for public 
examination in Washington, DC, a list of facilities which have filed 
attestations, and such facilities' visa petitions (if any) for H-1A 
nurses, and for each such facility, a copy of the facility's attestation 
and any explanatory statements it has received; the annual State plan 
(if any) which relates to the facility's attestation; and a copy of each 
of the facility's H-1A visa petitions (if any) to INS. A copy of the 
latter shall be transmitted to ETA by the facility at the same time it 
is submitted to INS. The facility shall also forward to ETA a copy of 
the INS visa petition approval notice within 5 days after it is received 
from INS.
    (b) Public examination at facility. For the duration of the 
attestation's validity and thereafter for so long as the facility uses 
any H-1 or H-1A nurse under the attestation, the facility shall maintain 
a separate file containing the attestation and required documentation, 
and shall make this file available to any interested parties within 72 
hours upon written or oral request. If a party requests a copy of the 
file, the facility shall provide it and any charge for such copy shall 
not exceed the cost of reproduction.
    (c) Notice to public. ETA periodically shall publish a notice in the 
Federal Register announcing the names and addresses of facilities which 
have submitted attestations; facilities which have attestations on file; 
facilities which have submitted attestations

[[Page 597]]

which have been rejected for filing; facilities which have had 
attestations suspended; States which have submitted annual State plans; 
States which have approved annual State plans; and States which have 
submitted annual State plans which were disapproved.

(Approved by the Office of Management and Budget under control number 
1205-0305)

[59 FR 882, 897, Jan. 6, 1994, as amended at 59 FR 5487, Feb. 4, 1994]



               Subpart E_Enforcement of H	1A Attestations

    Source: 59 FR 882, 897, Jan. 6, 1994, unless otherwise noted.



Sec.  655.400  Enforcement authority of Administrator, Wage and
Hour Division.

    (a) The Administrator shall perform all the Secretary's 
investigative and enforcement functions under 8 U.S.C. 1182(m) and 
subparts D and E of this part.
    (b) The Administrator, either pursuant to a complaint or otherwise, 
shall conduct such investigations as may be appropriate and, in 
connection therewith, enter and inspect such places and such records 
(and make transcriptions thereof), question such persons and gather such 
information as deemed necessary by the Administrator to determine 
compliance regarding the matters to which a health care facility has 
attested under section 212(m) of the INA (8 U.S.C. 1182(m)) and subparts 
D and E of this part.
    (c) A facility being investigated shall make available to the 
Administrator such records, information, persons, and places as the 
Administrator deems appropriate to copy, transcribe, question, or 
inspect. No facility shall interfere with any official of the Department 
of Labor performing an investigation, inspection or law enforcement 
function pursuant to 8 U.S.C. 1182(m) or subparts D or E of this part. 
In the event of such interference, the Administrator may deem the 
interference to be a violation and take such further actions as the 
Administrator considers appropriate. (Note: Federal criminal statutes 
prohibit certain interference with a Federal officer in the performance 
of official duties. 18 U.S.C. 111 and 1114.)
    (d) A facility subject to subparts D and E of this part shall at all 
times cooperate in administrative and enforcement proceedings. No 
facility shall intimidate, threaten, restrain, coerce, blacklist, 
discharge, or in any manner discriminate against any person because such 
person has:
    (1) Filed a complaint or appeal under or related to section 212(m) 
of the INA (8 U.S.C. 1182(m)) or subpart D or E of this part;
    (2) Testified or is about to testify in any proceeding under or 
related to section 212(m) of the INA (8 U.S.C. 1182(m)) or subpart D or 
E of this part;
    (3) Exercised or asserted on behalf of himself/herself or others any 
right or protection afforded by section 212(m) of the INA (8 U.S.C. 
1182(m)) or subpart D or E of this part.
    (4) Consulted with an employee of a legal assistance program or an 
attorney on matters related to the Act or to subparts D or E of this 
part or any other DOL regulation promulgated pursuant to 8 U.S.C. 
1182(m).

In the event of such intimidation or restraint as are described in 
paragraph (d)(1), (2), (3), or (4) of this section, the Administrator 
may deem the conduct to be a violation and take such further actions as 
the Administrator considers appropriate.
    (e) A facility subject to subpart D and E of this part shall 
maintain a separate file containing its attestation and required 
documentation, and shall make that file or copies thereof available to 
interested parties, as required bySec. 655.350(b). In the event of a 
facility's failure to maintain the file, to provide access, or to 
provide copies, the Administrator may deem the conduct to be a violation 
and take such further actions as the Administrator considers 
appropriate.
    (f) No health care facility shall seek to have an H-1A nurse, or any 
other nurse similarly employed by the employer, or any other employee 
waive rights conferred under the Act or under subpart D or E of this 
part. In the event of such waiver, the Administrator may deem the 
conduct to be a violation and take such further actions

[[Page 598]]

as the Administrator considers appropriate. Any agreement by an employee 
purporting to waive or modify any rights inuring to said person under 
the Act or subpart D or E of this part may be void as contrary to public 
policy, except that a waiver or modification of rights or obligations 
hereunder in favor of the Secretary shall be valid for purposes of 
enforcement of the provisions of the Act or subpart D and E of this 
part. This prohibition of waivers does not prevent agreements to settle 
litigation among private parties.
    (g) The Administrator shall, to the extent possible under existing 
law, protect the confidentiality of any complainant or other person who 
provides information to the Department.



Sec.  655.405  Complaints and investigative procedures.

    (a) The Administrator, through investigation, shall determine 
whether a facility has failed to perform any attested conditions, 
misrepresented any material facts in an attestation (including 
misrepresentation as to compliance with regulatory standards), or 
otherwise violated the Act or subpart D or E of this part.
    (Note: Federal criminal statutes provide penalties of up to $10,000 
and/or imprisonment of up to 5 years for knowing and willful submission 
of false statements to the Federal Government. 18 U.S.C. 1001; see also 
18 U.S.C. 1546).
    (b) Any aggrieved person or organization may file a complaint of a 
violation of the provisions of section 212(m) of the INA (8 U.S.C. 
1182(m)) or subpart D or E of this part. No particular form of complaint 
is required, except that the complaint shall be written or, if oral, 
shall be reduced to writing by the Wage and Hour Division official who 
receives the complaint. The complaint shall set forth sufficient facts 
for the Administrator to determine what part or parts of the attestation 
or regulations have allegedly been violated. Upon the request of the 
complainant, the Administrator shall, to the extent possible under 
existing law, maintain confidentiality regarding the complainant's 
identity; if the complainant wishes to be a party to the administrative 
hearing proceedings under this subpart, the complainant shall then waive 
confidentiality. The complaint may be submitted to any local Wage and 
Hour Division office; the addresses of such offices are found in local 
telephone directories. Inquiries concerning the enforcement program and 
requests for technical assistance regarding compliance may also be 
submitted to the local Wage and Hour Division office.
    (c) The Administrator shall determine whether there is reasonable 
cause to believe that the complaint warrants investigation and, if so, 
shall conduct an investigation, within 180 days of the receipt of a 
complaint. If the Administrator determines that the complaint fails to 
present reasonable cause for an investigation, the Administrator shall 
so notify the complainant, who may submit a new complaint, with such 
additional information as may be necessary.
    (d) When an investigation has been conducted, the Administrator 
shall, within 180 days of the receipt of a complaint, issue a written 
determination, stating whether a basis exists to make a finding that the 
facility failed to meet a condition of its attestation, or made a 
misrepresentation of a material fact therein, or otherwise violated the 
Act or subpart D or E. The determination shall specify any sanctions 
imposed due to violations. The Administrator shall provide a notice of 
such determination to the interested parties and shall inform them of 
the opportunity for a hearing pursuant toSec. 655.420.



Sec.  655.410  Civil money penalties and other remedies.

    (a) The Administrator may assess a civil money penalty not to exceed 
$1,000 for each affected person with respect to whom there has been a 
violation of the attestation or subpart D or E of this part of and with 
respect to each instance in which such violation occurred. The 
Administrator also shall impose appropriate remedies, including the 
payment of back wages and the performance of attested obligations such 
as providing training.
    (b) In determining the amount of civil money penalty to be assessed 
for any violation, the Administrator shall consider the type of 
violation committed and other relevant factors. The

[[Page 599]]

matters which may be considered include, but are not limited to, the 
following:
    (1) Previous history of violation, or violations, by the facility 
under the Act and subpart D or E of this part;
    (2) The number of workers affected by the violation or violations;
    (3) The gravity of the violation or violations;
    (4) Efforts made by the violator in good faith to comply with the 
attestation or the State plan as provided in the Act and Subparts D and 
E of this part;
    (5) The violator's explanation of the violation or violations;
    (6) The violator's commitment to future compliance, taking into 
account the public health, interest or safety; and
    (7) The extent to which the violator achieved a financial gain due 
to the violation, or the potential financial loss or potential injury or 
adverse effect upon the workers.
    (c) The civil money penalty, back wages, and any other remedy 
determined by the Administrator to be appropriate, are immediately due 
for payment or performance upon the assessment by the Administrator, or 
the decision by an administrative law judge where a hearing is 
requested, or the decision by the Secretary where review is granted. The 
facility shall remit the amount of the civil money penalty, by certified 
check or money order made payable to the order of ``Wage and Hour 
Division, Labor.'' The remittance shall be delivered or mailed to the 
Wage and Hour Division Regional Office for the area in which the 
violations occurred. The payment of back wages, monetary relief, and/or 
the performance or any other remedy prescribed by the Administrator 
shall follow procedures established by the Administrator. The facility's 
failure to pay the civil money penalty, back wages, or other monetary 
relief, or to perform any other assessed remedy, shall result in the 
rejection by ETA of any future attestation submitted by the facility, 
until such payment or performance is accomplished.



Sec.  655.415  Written notice and service of Administrator's 
determination.

    (a) The Administrator's determination, issued pursuant toSec. 
655.405(d), shall be served on the complainant, the facility, and other 
interested parties by personal service or by certified mail at the 
parties' last known addresses. Where service by certified mail is not 
accepted by the party, the Administrator may exercise discretion to 
serve the determination by regular mail. Where the complainant has 
requested confidentiality, the Administrator shall serve the 
determination in a manner which will not breach that confidentiality.
    (b) The Administrator shall file with the Chief Administrative Law 
Judge, U.S. Department of Labor, a copy of the complaint and the 
Administrator's determination.
    (c) The Administrator's written determination required bySec. 
655.405(c) shall:
    (1) Set forth the determination of the Administrator and the reason 
or reasons therefor; prescribe any remedies or penalties including the 
amount of any unpaid wages due, the actions required for compliance with 
the facility attestation and/or State plan, and the amount of any civil 
money penalty assessment and the reason or reasons therefor.
    (2) Inform the interested parties that they may request a hearing 
pursuant toSec. 655.420.
    (3) Inform the interested parties that in the absence of a timely 
request for a hearing, received by the Chief Administrative Law Judge 
within 10 days of the date of the determination, the determination of 
the Administrator shall become final and not appealable.
    (4) Set forth the procedure for requesting a hearing, and give the 
address of the Chief Administrative Law Judge.
    (5) Inform the parties that, pursuant toSec. 655.455, the 
Administrator shall notify the Attorney General and ETA of the 
occurrence of a violation by the employer.



Sec.  655.420  Request for hearing.

    (a) Any interested party desiring to request an administrative 
hearing on a determination issued pursuant to

[[Page 600]]

Sec.  655.405(d) shall make such request in writing to the Chief 
Administrative Law Judge at the address stated in the notice of 
determination.
    (b) An interested party may request a hearing in the following 
circumstances:
    (1) Where the Administrator determines that there is no basis for a 
finding of violation, the complainant or other interested party may 
request a hearing. In such a proceeding, the party requesting the 
hearing shall be the prosecuting party and the facility shall be the 
respondent; the Administrator may intervene as a party or appear as 
amicus curiae at any time in the proceeding, at the Administrator's 
discretion.
    (2) Where the Administrator determines that there is a basis for a 
finding of violation, the facility or other interested party may request 
a hearing. In such a proceeding, the Administrator shall be the 
prosecuting party and the facility shall be the respondent.
    (c) No particular form is prescribed for any request for hearing 
permitted by this part. However, any such request shall:
    (1) Be dated;
    (2) Be typewritten or legibly written;
    (3) Specify the issue or issues stated in the notice of 
determination given rise to such request;
    (4) State the specific reason or reasons why the party requesting 
the hearing believes such determination is in error;
    (5) Be signed by the party making the request or by an authorized 
representative of such party; and
    (6) Include the address at which such party or authorized 
representative desires to receive further communications relating 
thereto.
    (d) The request for such hearing shall be received by the Chief 
Administrative Law Judge, at the address stated in the Administrator's 
notice of determination, no later than 10 days after the date of the 
determination. An interested party which fails to meet this 10-day 
deadline for requesting a hearing may thereafter participate in the 
proceedings only by consent of the administrative law judge, either 
through intervention as a party pursuant to 29 CFR 18.10 (b) through (d) 
or through participation as an amicus curiae pursuant to 29 CFR 18.12.
    (e) The request may be filed in person, by facsimile transmission, 
by certified or regular mail, or by courier service. For the requesting 
party's protection, if the request is filed by mail, it should be 
certified mail. If the request is filed by facsimile transmission, the 
original of the request, signed by the requestor or authorized 
representative, shall be filed within 10 days of the date of the 
Administrator's notice of determination.
    (f) Copies of the request for a hearing shall be sent by the 
requestor to the Wage and Hour Division official who issued the 
Administrator's notice of determination, to the representative(s) of the 
Solicitor of Labor identified in the notice of determination, and to all 
known interested parties.



Sec.  655.425  Rules of practice for administrative law judge
proceedings.

    (a) Except as specifically provided in this subpart, and to the 
extent they do not conflict with the provisions of this subpart, the 
``Rules of Practice and Procedure for Administrative Hearings Before the 
Office of Administrative Law Judges'' established by the Secretary at 29 
CFR part 18 shall apply to administrative proceedings under this 
subpart.
    (b) As provided in the Administrative Procedure Act, 5 U.S.C. 556, 
any oral or documentary evidence may be received in proceedings under 
this part. The Federal Rules of Evidence and subpart B of the Rules of 
Practice and Procedure for Administrative Hearings Before the Office of 
Administrative Law Judges (29 CFR part 18, subpart B) shall not apply, 
but principles designed to ensure production of relevant and probative 
evidence shall guide the admission of evidence. The administrative law 
judge may exclude evidence which is inmaterial, irrelevant, or unduly 
repetitive.



Sec.  655.430  Service and computation of time.

    (a) Under this subpart, a party may serve any pleading or document 
by regular mail. Service is complete upon mailing to the last known 
address. No additional time for filing or response is

[[Page 601]]

authorized where service is by mail. In the interest of expeditious 
proceedings, the administrative law judge may direct the parties to 
serve pleadings or documents by a method other than regular mail.
    (b) Two (2) copies of all pleadings and other documents in any 
administrative law judge proceeding shall be served on the attorneys for 
the Administrator. One copy shall be served on the Associate Solicitor, 
Division of Fair Labor Standards, Office of the Solicitor, U.S. 
Department of Labor, 200 Constitution Avenue NW., Washington, DC 20210, 
and one copy on the attorney representing the Administrator in the 
proceeding.
    (c) Time will be computed beginning with the day following the 
action and includes the last day of the period unless it is a Saturday, 
Sunday, or federally-observed holiday, in which case the time period 
includes the next business day.



Sec.  655.435  Administrative law judge proceedings.

    (a) Upon receipt of a timely request for a hearing filed pursuant to 
and in accordance withSec. 655.420, the Chief Administrative Law Judge 
shall appoint an administrative law judge to hear the case.
    (b) Within 7 days following the assignment of the case, the 
administrative law judge shall notify all interested parties of the 
date, time and place of the hearing. All parties shall be given at least 
5 days notice of such hearing.
    (c) The date of the hearing shall be not more than 60 days from the 
date of the Administrator's determination. Because of the time 
constraints imposed by the Act, no requests for postponement shall be 
granted except for compelling reasons and by consent of all the parties 
to the proceeding.
    (d) The administrative law judge may prescribe a schedule by which 
the parties are permitted to file a prehearing brief or other written 
statement of fact or law. Any such brief or statement shall be served 
upon each other party in accordance withSec. 655.430. Posthearing 
briefs will not be permitted except at the request of the administrative 
law judge. When permitted, any such brief shall be limited to the issue 
or issues specified by the administrative law judge, shall be due within 
the time prescribed by the administrative law judge, and shall be served 
on each other party in accordance withSec. 655.430.



Sec.  655.440  Decision and order of administrative law judge.

    (a) Within 90 days after receipt of the transcript of the hearing, 
the administrative law judge shall issue a decision.
    (b) The decision of the administrative law judge shall include a 
statement of findings and conclusions, with reasons and basis therefore, 
upon each material issue presented on the record. The decision shall 
also include an appropriate order which may affirm, deny, reverse, or 
modify, in whole or in part, the determination of the Administrator; the 
reason or reasons for such order shall be stated in the decision. The 
administrative law judge shall not render determinations as to the 
legality of a regulatory provision or the constitutionality of a 
statutory provision.
    (c) The decision shall be served on all parties in person or by 
certified or regular mail.



Sec.  655.445  Secretary's review of administrative law judge's 
decision.

    (a) The Administrator or any interested party desiring review of the 
decision and order of an administrative law judge shall petition the 
Secretary to review the decision and order. To be effective, such 
petition shall be received by the Secretary within 30 days of the date 
of the decision and order. Copies of the petition shall be served on all 
parties and on the administrative law judge.
    (b) No particular form is prescribed for any petition for 
Secretary's review permitted by this subpart. However, any such petition 
shall:
    (1) Be dated;
    (2) Be typewritten or legibly written;
    (3) Specify the issue or issues stated in the administrative law 
judge decision and order giving rise to such petition;
    (4) State the specific reason or reasons why the party petitioning 
for review believes such decision and order are in error;

[[Page 602]]

    (5) Be signed by the party filing the petition or by an authorized 
representative of such party;
    (6) Include the address at which such party or authorized 
representative desires to receive further communications relating 
thereto; and
    (7) Attach copies of the administrative law judge's decision and 
order, and any other record documents which would assist the Secretary 
in determining whether review is warranted.
    (c) Whenever the Secretary determines to review the decision and 
order of an administrative law judge, a notice of the Secretary's 
determination shall be served upon the administrative law judge and upon 
all parties to the proceeding within 30 days after the Secretary's 
receipt of the petition for review.
    (d) Upon receipt of the Secretary's notice, the Office of 
Administrative Law Judges shall within 15 days forward the complete 
hearing record to the Secretary.
    (e) The Secretary's notice shall specify:
    (1) The issue or issues to be reviewed;
    (2) The form in which submissions shall be made by the parties 
(e.g., briefs, oral argument);
    (3) The time within which such submissions shall be made.
    (f) All documents submitted to the Secretary shall be filed with the 
Secretary of Labor, U.S. Department of Labor, Washington, DC 20210, 
Attention: Executive Director, Office of Administrative Appeals, room S-
4309. An original and two copies of all documents shall be filed. 
Documents are not deemed filed with the Secretary until actually 
received by the Secretary. All documents, including documents filed by 
mail, shall be received by the Secretary either on or before the due 
date.
    (g) Copies of all documents filed with the Secretary shall be served 
upon all other parties involved in the proceeding. Service upon the 
Administrator shall be in accordance withSec. 655.430(b).
    (h) The Secretary's final decision shall be issued within 180 days 
from the date of the notice of intent to review. The Secretary's 
decision shall be served upon all parties and the administrative law 
judge.
    (i) Upon issuance of the Secretary's decision, the Secretary shall 
transmit the entire record to the Chief Administrative Law Judge for 
custody pursuant toSec. 655.450.



Sec.  655.450  Administrative record.

    The official record of every completed administrative hearing 
procedure provided by subparts D and E of this part shall be maintained 
and filed under the custody and control of the Chief Administrative Law 
Judge. Upon receipt of a complaint seeking review of the final agency 
action in a United States District Court, the Chief Administrative Law 
Judge shall certify the official record and shall transmit such record 
to the clerk of the court.



Sec.  655.455  Notice to the Attorney General and the Employment and
Training Administration.

    (a) The Administrator shall promptly notify the Attorney General and 
ETA of the final determination of a violation by an employer upon the 
earliest of the following events:
    (1) Where the Administrator determines that there is a basis for a 
finding of violation by an employer, and no timely request for hearing 
is made pursuant toSec. 655.420; or
    (2) Where, after a hearing, the administrative law judge issues a 
decision and order finding a violation by an employer; or
    (3) Where the administrative law judge finds that there was no 
violation, and the Secretary, upon review, issues a decision pursuant to 
Sec.  655.445, holding that a violation was committed by an employer.
    (b) The Attorney General, upon receipt of the Administrator's notice 
pursuant to paragraph (a) of this section, shall not approve petitions 
filed with respect to that employer under section 212(m) of the INA (8 
U.S.C. 1182(m)) during a period of at least 12 months from the date of 
receipt of the Administrator's notification.
    (c) ETA, upon receipt of the Administrator's notice pursuant to 
paragraph (a) of this section, shall suspend the employer's attestation 
under subparts

[[Page 603]]

D and E of this part, and shall not accept for filing any attestation 
submitted by the employer under subparts D and E of this part, for a 
period of 12 months from the date of receipt of the Administrator's 
notification or for a longer period if such is specified by the Attorney 
General for visa petitions filed by that employer under section 212(m) 
of the INA.



Sec.  655.460  Non-applicability of the Equal Access to Justice Act.

    A proceeding under subpart D or E of this part is not subject to the 
Equal Access to Justice Act, as amended, 5 U.S.C. 504. In such a 
proceeding, the administrative law judge shall have no authority to 
award attorney fees and/or other litigation expenses pursuant to the 
provisions of the Equal Access to Justice Act.



    Subpart F_Attestations by Employers Using Alien Crewmembers for 
                   Longshore Activities in U.S. Ports

    Source: 60 FR 3956, 3976, Jan. 19, 1995, unless otherwise noted.

                           General Provisions



Sec.  655.500  Purpose, procedure and applicability of subparts F and
G of this part.

    (a) Purpose. (1) Section 258 of the Immigration and Nationality Act 
(``Act'') prohibits nonimmigrant alien crewmembers admitted to the 
United States on D-visas from performing longshore work at U.S. ports 
except in five specific instances:
    (i) Where the vessel's country of registration does not prohibit 
U.S. crewmembers from performing longshore work in that country's ports 
and nationals of a country (or countries) which does not prohibit U.S. 
crewmembers from performing longshore work in that country's ports hold 
a majority of the ownership interest in the vessel, as determined by the 
Secretary of State (henceforth referred to as the ``reciprocity 
exception'');
    (ii) Where there is in effect in a local port one or more collective 
bargaining agreement(s), each covering at least thirty percent of the 
longshore workers, and each permitting the activity to be performed 
under the terms of such agreement(s);
    (iii) Where there is no collective bargaining agreement covering at 
least thirty percent of the longshore workers at the particular port and 
an attestation with accompanying documentation has been filed with the 
Department of Labor attesting that, among other things, the use of alien 
crewmembers to perform a particular activity of longshore work is 
permitted under the prevailing practice of the particular port 
(henceforth referred to as the ``prevailing practice exception'');
    (iv) Where the longshore work is to be performed at a particular 
location in the State of Alaska and an attestation with accompanying 
documentation has been filed with the Department of Labor attesting 
that, among other things, before using alien crewmembers to perform the 
activity specified in the attestation, the employer will make a bona 
fide request for and employ United States longshore workers who are 
qualified and available in sufficient numbers from contract stevedoring 
companies, labor organizations recognized as exclusive bargaining 
representatives of United States longshore workers, and private dock 
operators (henceforth referred to as the ``Alaska exception''); or
    (v) Where the longshore work involves an automated self-unloading 
conveyor belt or vacuum-actuated system on a vessel and the 
Administrator has not previously determined that an attestation must be 
filed pursuant to this part as a basis for performing those functions 
(henceforth referred to as the ``automated vessel exception'').
    (2) The term ``longshore work'' does not include the loading or 
unloading of hazardous cargo, as determined by the Secretary of 
Transportation, for safety and environmental protection. The Department 
of Homeland Security (DHS) through the United States Citizenship and 
Immigration Services (USCIS), determines whether an employer may use 
alien crewmembers for longshore work at U.S. ports. In those cases where 
an employer must file an attestation in order to perform such work, the 
Department of Labor shall be responsible

[[Page 604]]

for accepting the filing of such attestations. Subpart F of this part 
sets forth the procedure for filing attestations with the Department of 
Labor for employers proposing to use alien crewmembers for longshore 
work at U.S. ports under the prevailing practice exception, the Alaska 
exception, and where it has been determined that an attestation is 
required under the automated vessel exception listed in paragraph 
(a)(1)(iv) of this section. Subpart G of this part sets forth complaint, 
investigation, and penalty provisions with respect to such attestations.
    (b) Procedure. (1) Under the prevailing practice exception in sec. 
258(c) of the Act, and in those cases where it has been determined that 
an attestation is required under the automated vessel exception for 
longshore work to be performed at locations other than in the State of 
Alaska, the procedure involves filing an attestation with the Department 
of Labor attesting that:
    (i) The use of alien crewmembers for a particular activity of 
longshore work is the prevailing practice at the particular port;
    (ii) The use of alien crewmembers is not during a strike or lockout 
nor designed to influence the election of a collective bargaining 
representative; and
    (iii) Notice of the attestation has been provided to the bargaining 
representative of longshore workers in the local port, or, where there 
is none, notice has been provided to longshore workers employed at the 
local port.
    (2) Under the automated vessel exception in sec. 258(c) of the Act, 
no attestation is required in cases where longshore activity consists of 
the use of an automated self-unloading conveyor belt or vacuum-actuated 
system on a vessel. The legislation creates a rebuttable presumption 
that the use of alien crewmembers for the operation of such automated 
systems is the prevailing practice. In order to overcome such 
presumption, it must be shown by the preponderance of the evidence 
submitted by any interested party, that the use of alien crewmembers for 
such activity is not the prevailing practice at the particular port, 
that it is during a strike or lockout, or that it is intended or 
designed to influence an election of a bargaining representative for 
workers in the local port.
    (3) Under the Alaska exception in sec. 258(d) of the Act, and in 
those cases where it has been determined that an attestation is required 
under the automated vessel exception consisting of the use of such 
equipment for longshore work to be performed in the State of Alaska, the 
procedure involves filing an attestation with the Department of Labor 
attesting that:
    (i) The employer will make a bona fide request for United States 
longshore workers who are qualified and available in sufficient numbers 
to perform the activity at the particular time and location from the 
parties to whom notice has been provided under paragraph (b)(3)(iv) (B) 
and (C) of this section, except that:
    (A) Wherever two or more contract stevedoring companies which meet 
the requirements of section 32 of the Longshore and Harbor Workers' 
Compensation Act (33 U.S.C. 932) have signed a joint collective 
bargaining agreement with a single labor organization recognized as an 
exclusive bargaining representative of United States longshore workers 
within the meaning of the National Labor Relations Act (29 U.S.C. 141 et 
seq.), the employer may request longshore workers from only one such 
contract stevedoring company, and
    (B) A request for longshore workers to an operator of a private dock 
may be made only for longshore work to be performed at that dock and 
only if the operator meets the requirements of section 32 of the 
Longshore and Harbor Workers' Compensation Act (33 U.S.C. 932);
    (ii) The employer will employ all United States longshore workers 
made available in response to the request made pursuant to paragraph 
(b)(3)(i) of this section who are qualified and available in sufficient 
numbers and who are needed to perform the longshore activity at the 
particular time and location attested to;
    (iii) The use of alien crewmembers for such activity is not intended 
or designed to influence and election of a bargaining representative for 
workers in the State of Alaska; and

[[Page 605]]

    (iv) Notice of the attestation has been provided to:
    (A) Labor organizations which have been recognized as exclusive 
bargaining representatives of United States longshore workers within the 
meaning of the National Labor Relations Act (29 U.S.C. 141 et seq.) and 
which make available or intend to make available workers to the 
particular location where the longshore work is to be performed;
    (B) Contract stevedoring companies which employ or intend to employ 
United States longshore workers at that location; and
    (C) Operators of private docks at which the employer will use 
longshore workers.
    (c) Applicability. Subparts F and G of this part apply to all 
employers who seek to employ alien crewmembers for longshore work at 
U.S. ports under the prevailing practice exception, to all employers who 
seek to employ alien crewmembers for longshore work at locations in the 
State of Alaska under the Alaska exception, to all employers claiming 
the automated vessel exception, and to those cases where it has been 
determined that an attestation is required under the automated vessel 
exception.

[60 FR 3956, 3976, Jan. 19, 1995, as amended at 71 FR 35520, June 21, 
2006]



Sec.  655.501  Overview of responsibilities.

    This section provides a context for the attestation process, to 
facilitate understanding by employers that may seek to employ alien 
crewmembers for longshore work under the prevailing practice exception, 
under the Alaska exception, and in those cases where an attestation is 
necessary under the automated vessel exception.
    (a) Department of Labor's responsibilities. The United States 
Department of Labor (DOL) administers the attestation process. Within 
DOL, the Employment and Training Administration (ETA) shall have 
responsibility for setting up and operating the attestation process; the 
Employment Standards Administration's Wage and Hour Division shall be 
responsible for investigating and resolving any complaints filed 
concerning such attestations.
    (b) Employer attestation responsibilities. (1) Each employer seeking 
to use alien crewmembers for longshore work at a local U.S. port 
pursuant to the prevailing practice exception or where an attestation is 
required under the automated vessel exception for longshore work to be 
performed at locations other than in the State of Alaska shall, as the 
first step, submit an attestation on Form ETA 9033, as described in 
Sec.  655.510 of this part, to ETA at the address set forth atSec. 
655.510(b) of this part. If ETA accepts the attestation for filing, 
pursuant toSec. 655.510 of this part, ETA shall return the cover form 
of the accepted attestation to the employer, and, at the same time, 
shall provide notice of the filing to the United States Citizenship and 
Immigration Services of the Department of Homeland Security (DHS) office 
having jurisdiction over the port where longshore work will be 
performed.
    (2) Each employer seeking to use alien crewmembers for longshore 
work at a particular location in the State of Alaska pursuant to the 
Alaska exception or where an attestation is required under the automated 
vessel exception for longshore work to be performed at a particular 
location in Alaska shall submit, as a first step, an attestation on Form 
ETA 9033-A, as described inSec. 655.533 of this part, to ETA at the 
address of the Seattle regional office as set forth atSec. 655.532 of 
this part. The address appears in the instructions to Form ETA 9033-A. 
ETA shall return the cover form of the accepted attestation to the 
employer, and, at the same time, shall provide notice of the filing to 
the DHS office having jurisdiction over the location where longshore 
work will be performed.
    (c) Complaints. Complaints concerning misrepresentation in the 
attestation, failure of the employer to carry out the terms of the 
attestation, or complaints that an employer is required to file an 
attestation under the automated vessel exception, may be filed with the 
Wage and Hour Division, according to the procedures set forth in subpart 
G of this part. Complaints of ``misrepresentation'' may include 
assertions that an employer has attested to the use of alien crewmembers 
only for a particular activity of longshore

[[Page 606]]

work and has thereafter used such alien crewmembers for another activity 
of longshore work. If the Division determines that the complaint 
presents reasonable cause to warrant an investigation, the Division 
shall then investigate, and, where appropriate, after an opportunity for 
a hearing, assess sanctions and penalties. Subpart G of this part 
further provides that interested parties may obtain an administrative 
law judge hearing on the Division's determination after an investigation 
and may seek the Secretary's review of the administrative law judge's 
decision. Subpart G of this part also provides that a complainant may 
request that the Wage and Hour Administrator issue a cease and desist 
order in the case of either alleged violation(s) of an attestation or 
longshore work by alien crewmember(s) employed by an employer allegedly 
not qualified for the claimed automated vessel exception. Upon the 
receipt of such a request, the Division shall notify the employer, 
provide an opportunity for a response and an informal meeting, and then 
rule on the request, which shall be granted if the preponderance of the 
evidence submitted supports the complainant's position.

[60 FR 3956, 3976, Jan. 19, 1995, as amended at 71 FR 35521, June 21, 
2006]



Sec.  655.502  Definitions.

    For the purposes of subparts F and G of this part:
    Accepted for filing means that a properly completed attestation on 
Form ETA 9033, including accompanying documentation for each of the 
requirements inSec. 655.510 (d) through (f) of this part, or a 
properly completed attestation on Form ETA 9033-A, including 
accompanying documentation for the requirement inSec. 655.537 of this 
part in the case of an attestation under the Alaska exception, submitted 
by the employer or its designated agent or representative has been 
received and filed by the Employment and Training Administration of the 
Department of Labor (DOL). (Unacceptable attestations under the 
prevailing practice exception are described atSec. 655.510(g)(2) of 
this part. Unacceptable attestations under the Alaska exception are 
described atSec. 655.538(b) of this part.)
    Act and INA mean the Immigration and Nationality Act, as amended, 8 
U.S.C. 1101 et seq.
    Activity means any activity relating to loading cargo; unloading 
cargo; operation of cargo-related equipment; or handling of mooring 
lines on the dock when a vessel is made fast or let go.
    Administrative law judge means an official appointed pursuant to 5 
U.S.C. 3105.
    Administrator means the Administrator of the Wage and Hour Division, 
Employment Standards Administration, Department of Labor, or such 
authorized representatives as may be designated to perform any of the 
functions of the Administrator under subparts F and G of this part.
    Administrator, Office of Foreign Labor Certification (OFLC 
Administrator) means the primary official of the Office of Foreign Labor 
Certification (OFLC Administrator), or the OFLC Administrator's 
designee.
    Attestation means documents submitted by an employer attesting to 
and providing accompanying documentation to show that, under the 
prevailing practice exception, the use of alien crewmembers for a 
particular activity of longshore work at a particular U.S. port is the 
prevailing practice, and is not during a strike or lockout nor intended 
to influence an election of a bargaining representative for workers; and 
that notice of the attestation has been provided to the bargaining 
representative, or, where there is none, to the longshore workers at the 
local port. Under the Alaska exception, such documents shall show that, 
before using alien crewmen to perform longshore work, the employer will 
make bona fide requests for dispatch of United States longshore workers 
who are qualified and available in sufficient numbers and that the 
employer will employ all such United States longshore workers in 
response to such a request for dispatch; that the use of alien 
crewmembers is not intended or designed to influence an election of a 
bargaining representative for workers in the State of Alaska; and that 
notice of the attestation has been provided to labor organizations 
recognized as exclusive bargaining representatives of

[[Page 607]]

United States longshore workers, contract stevedoring companies, and 
operators of private docks at which the employer will use longshore 
workers.
    Attesting employer means an employer who has filed an attestation.
    Attorney General means the chief official of the U.S. Department of 
Justice or the Attorney General's designee.
    Automated vessel means a vessel equipped with an automated self-
unloading conveyor belt or vacuum-actuated system which is utilized for 
loading or unloading cargo between the vessel and the dock.
    Certifying Officer (CO) means a Department of Labor official, or the 
CO's designee, who makes determinations about whether or not to grant 
applications for labor certification. The National Certifying Officer, 
which is the OFLC Administrator, makes such determinations in the 
national office of the OFLC.
    Chief Administrative Law Judge means the chief official of the 
Office of the Administrative Law Judges of the Department of Labor or 
the Chief Administrative Law Judge's designee.
    Contract stevedoring company means a stevedoring company which is 
licensed to do business in the State of Alaska and which meets the 
requirements of section 32 of the Longshore and Harbor Workers' 
Compensation Act (33 U.S.C. 932).
    Crewmember means any nonimmigrant alien admitted to the United 
States to perform services under sec. 101(a)(15)(D)(i) of the Act (8 
U.S.C. 1101(a)(15)(D)(i)).
    Date of filing means the date an attestation is accepted for filing 
by ETA.
    Department and DOL mean the United States Department of Labor.
    Department of Homeland Security (DHS) through the United States 
Citizenship and Immigration Services (USCIS) makes the determination 
under the Act on whether an employer of alien crewmembers may use such 
crewmembers for longshore work at a U.S. port.
    Division means the Wage and Hour Division of the Employment 
Standards Administration, DOL.
    Employer means a person, firm, corporation, or other association or 
organization, which suffers or permits, or proposes to suffer or permit, 
alien crewmembers to perform longshore work at a port within the U.S. 
For purposes of Sec.Sec. 655.530 through 655.541, which govern the 
performance of longshore activities by alien crewmembers under the 
Alaska exception, ``employer'' includes any agent or representative 
designated by the employer.
    Employment and Training Administration (ETA) means the agency within 
the Department of Labor (DOL) which includes the Office of Foreign Labor 
(OFLC).
    Employment Standards Administration (ESA) means the agency within 
the Department of Labor (DOL) which includes the Wage and Hour Division.
    Lockout means a labor dispute involving a work stoppage, wherein an 
employer withholds work from its employees in order to gain a concession 
from them.
    Longshore work means any activity (except safety and environmental 
protection work as described in sec. 258(b)(2) of the Act) relating to 
the loading or unloading of cargo, the operation of cargo related 
equipment (whether or not integral to the vessel), or the handling of 
mooring lines on the dock when the vessel is made fast or let go, in the 
United States or the coastal waters thereof.
    Longshore worker means a U.S. worker who performs longshore work.
    Office of Foreign Labor Certification (OFLC) means the 
organizational component within the ETA that provides national 
leadership and policy guidance and develops regulations and procedures 
to carry out the responsibilities of the Secretary of Labor under the 
INA concerning alien workers seeking admission to the United States in 
order to work under the Immigration and Nationality Act, as amended.
    Port means a geographic area, either on a seacoast, lake, river or 
any other navigable body of water, which contains one or more publicly 
or privately owned terminals, piers, docks, or maritime facilities, 
which is commonly thought of as a port by other government maritime-
related agencies, such as the Maritime Administration. U.S. ports 
include, but are not limited to, those listed in Appendix A to this 
subpart.

[[Page 608]]

    Qualified and available in sufficient numbers means the full 
complement of qualified longshore workers needed to perform the 
longshore activity, as determined by industry standards in the State of 
Alaska, including safety considerations.
    Secretary means the Secretary of Labor or the Secretary's designee.
    Strike means a labor dispute wherein employees engage in a concerted 
stoppage of work (including stoppage by reason of the expiration of a 
collective-bargaining agreement) or engage in any concerted slowdown or 
other concerted interruption of operations.
    Unanticipated emergency means an unexpected and unavoidable 
situation, such as one involving severe weather conditions, natural 
disaster, or mechanical breakdown, where cargo must be immediately 
loaded on, or unloaded from, a vessel.
    United States is defined at 8 U.S.C. 1101(a)(38).
    United States (U.S.) worker means a worker who is a U.S. citizen, a 
U.S. national, a permanent resident alien, or any other worker legally 
permitted to work indefinitely in the United States.

[60 FR 3956, 3976, Jan. 19, 1995, as amended at 71 FR 35520, June 21, 
2006]



Sec.  655.510  Employer attestations.

    (a) Who may submit attestations? An employer (or the employer's 
designated U.S. agent or representative) seeking to employ alien 
crewmembers for a particular activity of longshore work under the 
prevailing practice exception shall submit an attestation, provided 
there is not in effect in the local port any collective bargaining 
agreement covering at least 30 percent of the longshore workers. An 
attestation is required for each port at which the employer intends to 
use alien crewmembers for longshore work. The attestation shall include: 
A completed Form ETA 9033, which shall be signed by the employer (or the 
employer's designated agent or representative); and facts and evidence 
prescribed in paragraphs (d) through (f) of this section. ThisSec. 
655.510 shall not apply in the case of longshore work performed at a 
particular location in the State of Alaska. The procedures governing the 
filing of attestations under the Alaska exception are set forth at 
Sec.Sec. 655.530 through 655.541.
    (b) Where and when should attestations be submitted? (1) 
Attestations must be submitted, by U.S. mail, private carrier, or 
facsimile transmission to the U.S. Department of Labor office(s) which 
are designated by the OFLC Administrator. Attestations must be received 
and date-stamped by DOL at least 14 calendar days prior to the date of 
the first performance of the intended longshore activity, and shall be 
accepted for filing or returned by ETA in accordance with paragraph (g) 
of this section within 14 calendar days of the date received by ETA. An 
attestation which is accepted by ETA solely because it was not reviewed 
within 14 days is subject to subsequent invalidation pursuant to 
paragraph (i) of this section. Every employer filing an attestation 
shall have an agent or representative with a United States address. Such 
address shall be clearly indicated on the Form ETA 9033. In order to 
ensure that an attestation has been accepted for filing prior to the 
date of the performance of the longshore activity, employers are advised 
to take mailing time into account to make sure that ETA receives the 
attestation at least 14 days prior to the first performance of the 
longshore activity.
    (2) Unanticipated Emergencies. ETA may accept for filing 
attestations received after the 14-day deadline when due to an 
unanticipated emergency, as defined inSec. 655.502 of this part. When 
an employer is claiming an unanticipated emergency, it shall submit 
documentation to support such a claim. ETA shall then make a 
determination on the validity of the claim, and shall accept the 
attestation for filing or return it in accordance with paragraph (g) of 
this section. ETA shall in no case accept an attestation received later 
than the date of the first performance of the activity.
    (c) What should be submitted?--(1) Form ETA 9033 with accompanying 
documentation. For each port, a completed and dated original Form ETA 
9033, or facsimile transmission thereof, containing the required 
attestation elements and the original signature of the employer (or the 
employer's designated agent or representative) shall be submitted, along 
with two copies of the

[[Page 609]]

completed, signed, and dated Form ETA 9033. (If the attestation is 
submitted by facsimile transmission, the attestation containing the 
original signature shall be maintained at the U.S. business address of 
the employer's designated agent or representative). Copies of Form ETA 
9033 are available at the National Processing Centers and at the 
National Office. In addition, the employer shall submit two sets of all 
facts and evidence to show compliance with each of the attestation 
elements as prescribed by the regulatory standards in paragraphs (d) 
through (f) of this section. In the case of an investigation pursuant to 
subpart G of this part, the employer shall have the burden of proof to 
establish the validity of each attestation. The employer shall maintain 
in its records at the office of its U.S. agent, for a period of at least 
3 years from the date of filing, sufficient documentation to meet its 
burden of proof, which shall at a minimum include the documentation 
described in thisSec. 655.510, and shall make the documents available 
to Department of Labor officials upon request.
    Whenever any document is submitted to a Federal agency or retained 
in the employer's records pursuant to this part, the document either 
shall be in the English language or shall be accompanied by a written 
translation into the English language certified by the translator as to 
the accuracy of the translation and his/her competency to translate.
    (2) Statutory precondition regarding collective bargaining 
agreements. (i) The employer may file an attestation only when there is 
no collective bargaining agreement in effect in the port covering 30 
percent or more of the longshore workers in the port. The employer shall 
attest on the Form ETA 9033 that no such collective bargaining agreement 
exists at the port at the time that the attestation is filed.
    (ii) The employer is not required to submit with the Form ETA 9033 
documentation substantiating that there is no collective bargaining 
agreement in effect in the port covering 30 percent or more of the 
longshore workers. If a complaint is filed which presents reasonable 
cause to believe that such an agreement exists, the Department shall 
conduct an investigation. In such an investigation, the employer shall 
have the burden of proving that no such collective bargaining agreement 
exists.
    (3) Ports for which attestations may be filed. Employers may file an 
attestation for a port which is listed in appendix A (U.S. Seaports) to 
this subpart. Employers may also file an attestation for a particular 
location not in appendix A to this subpart if additional facts and 
evidence are submitted with the attestation to demonstrate that the 
location is a port, meeting all of the criteria as defined bySec. 
655.502 of this part.
    (4) Attestation elements. The attestation elements referenced in 
paragraph (c)(1) of this section are mandated by sec. 258(c)(1)(B) of 
the Act (8 U.S.C. 1288(c)(1)(B)). Section 258(c)(1)(B) of the Act 
requires employers who seek to have alien crewmembers engage in a 
longshore activity to attest as follows:
    (i) The performance of the activity by alien crewmembers is 
permitted under the prevailing practice of the particular port as of the 
date of filing of the attestation;
    (ii) The use of the alien crewmembers for such activity is not 
during a strike or lockout in the course of a labor dispute, and is not 
intended or designed to influence an election of a bargaining 
representative for workers in the local port; and
    (iii) Notice of the attestation has been provided by the owner, 
agent, consignee, master, or commanding officer to the bargaining 
representative of longshore workers in the local port, or, where there 
is no such bargaining representative, notice has been provided to 
longshore workers employed at the local port.
    (d) The first attestation element: prevailing practice. For an 
employer to be in compliance with the first attestation element, it is 
required to have been the prevailing practice during the 12-month period 
preceding the filing of the attestation, for a particular activity of 
longshore work at the particular port to be performed by alien 
crewmembers. For each port, a prevailing practice can exist for any of 
four different types of longshore work: loading of cargo, unloading of 
cargo, operation

[[Page 610]]

of cargo-related equipment, or handling of mooring lines. It is thus 
possible that at a particular port it is the prevailing practice for 
alien crewmembers to unload vessels but not the prevailing practice to 
load them. An employer shall indicate on the attestation form which of 
the four longshore activities it is claiming is the prevailing practice 
for such work to be performed by alien crewmembers.
    (1) Establishing a prevailing practice. (i) In establishing that a 
particular activity of longshore work is the prevailing practice at a 
particular port, an employer shall submit facts and evidence to show 
that in the 12-month period preceding the filing of the attestation, one 
of the following conditions existed:
    (A) Over fifty percent of vessels docking at the port used alien 
crewmembers for the activity; or
    (B) Alien crewmembers made up over fifty percent of the workers in 
the port who engaged in the activity.
    (ii) Prevailing practice after Secretary of State determination of 
non-reciprocity. Section 258(d) of the Act provides a reciprocity 
exception (separate from the prevailing practice exception) to the 
prohibition on performance of longshore work by alien crewmembers in 
U.S. ports. However, this reciprocity exception becomes nonapplicable 
where the Secretary of State determines that, for a particular activity 
of longshore work, a particular country (by law, regulation, or 
practice) prohibits such activity by U.S. crewmembers in its ports. When 
the Secretary of State places a country on the non-reciprocity list 
(which means, for the purposes of this section, Prohibitions on 
longshore work by U.S. nationals; listing by country at 22 CFR 89.1), 
crewmembers on vessels from that country (that is, vessels that are 
registered in that country or vessels whose majority ownership interest 
is held by nationals of that country) are not permitted to perform 
longshore work in U.S. waters, absent applicability of some exception 
other than the reciprocity exception. The Secretary of State's 
determination has the following effects in the establishment of a 
prevailing practice for a particular longshore activity at a particular 
U.S. port for purposes of the prevailing practice exception.
    (A) An employer from any country, other than the country which is 
placed on the non-reciprocity list, may include the longshore activities 
performed by alien crewmembers on all vessels in establishing the 
prevailing practice for a particular longshore activity in a particular 
port.
    (B) An employer from a country which is placed on the non-
reciprocity list may file an attestation for the prevailing practice 
exception under the standards and requirements established in this 
subpart F (except as provided in paragraph (d)(1)(ii)(C) of this 
section), provided that the attestation is filed at least 12 months 
after the date on which the employer's country is placed on the list.
    (C) An employer from a country which is placed on the non-
reciprocity list may file an attestation pursuant to the prevailing 
practice exception earlier than 12 months from the date on which the 
employer's country is placed on the list, except that the following 
restrictions shall apply to such attestation:
    (1) The employer shall submit facts and evidence to show that, for 
the 12-month period preceding the date of the attestation, the use of 
alien crewmembers to perform a particular activity of longshore work was 
permitted by the prevailing practice in the port (as defined in 
paragraph (d)(1)(i) of this section) without considering or including 
such activity by crewmembers on vessels from the employer's country; or
    (2) The employer shall submit facts and evidence (including data on 
activities performed by crewmembers on vessels from the employer's 
country) to show that the use of alien crewmembers to perform a 
particular activity of longshore work was permitted by the prevailing 
practice in the port (as defined in paragraph (d)(1)(i) of this section) 
for one of two periods--
    (i) For the employer whose country has not previously been on the 
non-reciprocity list, the period is the continuous 12-month period prior 
to May 28, 1991 (the effective date of section 258 of the Act); or

[[Page 611]]

    (ii) For the employer whose country was at some time on the non-
reciprocity list, but was subsequently removed from the non-reciprocity 
list and then restored to the non-reciprocity list (on one or more 
occasions), the period is the last continuous 12-month period during 
which the employer's country was not under the reciprocity exception 
(that is, was listed on the non-reciprocity list).
    (iii) For purposes of this paragraph (d)(1):
    (A) ``Workers in the port engaged in the activity'' means any person 
who performed the activity in any calendar day;
    (B) Vessels shall be counted each time they dock at the particular 
port):
    (C) Vessels exempt from section 258 of the INA for safety and 
environmental protection shall not be included in counting the number of 
vessels which dock at the port (see Department of Transportation 
Regulations); and
    (D) Automated vessels shall not be included in counting the number 
of vessels which dock at the port. For establishing a prevailing 
practice under the automated vessel exception seeSec. 655.520 of this 
part.
    (2) Documentation. In assembling the facts and evidence required by 
paragraph (d)(1) of this section, the employer may consult with the port 
authority which has jurisdiction over the local port, the collective 
bargaining representative(s) of longshore workers at the local port, 
other employers, or any other entity which is familiar with the 
practices at the port. Such documentation shall include a written 
summary of a survey of the experience of shipmasters who entered the 
local port in the previous year; or a letter, affidavit, or other 
written statement from an appropriate local port authority regarding the 
use of alien crewmembers to perform the longshore activity at the port 
in the previous year; or other documentation of comparable weight. 
Written statements from collective bargaining representatives and/or 
shipping agents with direct knowledge of practices regarding the use of 
alien crewmembers in the local port may also be pertinent. Such 
documentation shall accompany the Form ETA 9033, and any underlying 
documentation which supports the employer's burden of proof shall be 
maintained in the employer's records at the office of the U.S. agent as 
required by paragraph (c)(1) of this section.
    (e) The second attestation element: no strike or lockout; no 
intention or design to influence bargaining representative election. (1) 
The employer shall attest that, at the time of submitting the 
attestation, there is not a strike or lockout in the course of a labor 
dispute covering the employer's activity, and that it will not use alien 
crewmembers during a strike or lockout after filing the attestation. The 
employer shall also attest that the employment of such aliens is not 
intended or designed to influence an election for a bargaining 
representative for workers in the local port. Labor disputes for 
purposes of this attestation element relate only to those involving 
longshore workers at the port of intended employment. This attestation 
element applies to strikes and lockouts and elections of bargaining 
representatives at the local port where the use of alien crewmembers for 
longshore work is intended.
    (2) Documentation. As documentation to substantiate the requirement 
in paragraph (e)(1) of this section, an employer may submit a statement 
of the good faith efforts made to determine whether there is a strike or 
lockout at the particular port, as, for example, by contacting the port 
authority or the collective bargaining representative for longshore 
workers at the particular port.
    (f) The third attestation element: notice of filing. The employer of 
alien crewmembers shall attest that at the time of filing the 
attestation, notice of filing has been provided to the bargaining 
representative of the longshore workers in the local port, or, where 
there is no such bargaining representative, notice of the filing has 
been provided to longshore workers employed at the local port through 
posting in conspicuous locations and through other appropriate means.
    (1) Notification of bargaining representative. No later than the 
date the attestation is received by DOL to be considered for filing, the 
employer of alien

[[Page 612]]

crewmembers shall notify the bargaining representative (if any) of 
longshore workers at the local port that the attestation is being 
submitted to DOL. The notice shall include a copy of the Form ETA 9033, 
shall state the activity(ies) for which the attestation is submitted, 
and shall state in that notice that the attestation and accompanying 
documentation are available at the national office of ETA for review by 
interested parties. The employer may have its owner, agent, consignee, 
master, or commanding officer provide such notice. Notices under this 
paragraph (f)(1) shall include the following statement: ``Complaints 
alleging misrepresentation of material facts in the attestation and/or 
failure to comply with the terms of the attestation may be filed with 
any office of the Wage and Hour Division of the United States Department 
of Labor.''
    (2) Posting notice where there is no bargaining representative. If 
there is no bargaining representative of longshore workers at the local 
port when the employer submits an attestation to ETA, the employer shall 
provide written notice to the port authority for distribution to the 
public on request. In addition, the employer shall post one or more 
written notices at the local port, stating that the attestation with 
accompanying documentation has been submitted, the activity(ies) for 
which the attestation has been submitted, and that the attestation and 
accompanying documentation are available at the national office of ETA 
for review by interested parties. Such posted notice shall be clearly 
visible and unobstructed, and shall be posted in conspicuous places 
where the longshore workers readily can read the posted notice on the 
way to or from their duties. Appropriate locations for posting such 
notices include locations in the immediate proximity of mandatory Fair 
Labor Standards Act wage and hour notices and Occupational Safety and 
Health Act occupational safety and health notices. The notice shall 
include a copy of the Form ETA 9033 filed with DOL, shall provide 
information concerning the availability of supporting documents for 
examination at the national office of ETA, and shall include the 
following statement: ``Complaints alleging misrepresentation of material 
facts in the attestation and/or failure to comply with the terms of the 
attestation may be filed with any office of the Wage and Hour Division 
of the United States Department of Labor.''
    (3) Documentation. The employer shall provide a statement setting 
forth the name and address of the person to whom the notice was provided 
and where and when the notice was posted and shall attach a copy of the 
notice.
    (g) Actions on attestations submitted for filing. Once an 
attestation has been received from an employer, a determination shall be 
made by the Certifying Officer whether to accept the attestation for 
filing or return it. The Certifying Officer may request additional 
explanation and/or documentation from the employer in making this 
determination. An attestation which is properly filled out and which 
includes accompanying documentation for each of the requirements set 
forth atSec. 655.510(d) through (f) shall be accepted for filing by 
ETA on the date it is signed by the Certifying Officer unless it falls 
within one of the categories set forth in paragraph (g)(2) of this 
section. Once an attestation is accepted for filing, ETA shall then 
follow the procedures set forth in paragraph (g)(1) of this section. 
Upon acceptance of the employer's attestation by ETA, the attestation 
and accompanying documentation will be forwarded and shall be available 
in a timely manner for public examination at the ETA national office. 
ETA shall not consider information contesting an attestation received by 
ETA prior to the determination to accept or return the attestation for 
filing. Such information shall not be made part of ETA's administrative 
record on the attestation, but shall be referred to ESA to be processed 
as a complaint pursuant to subpart G of this part if the attestation is 
accepted by ETA for filing.
    (1) Acceptance. (i) If the attestation is properly filled out and 
includes accompanying documentation for each of the requirements at 
Sec.  655.510(d) through (f), and does not fall within one of the 
categories set forth at paragraph (g)(2) of

[[Page 613]]

this section, ETA shall accept the attestation for filing, provide 
notification to the DHS office having jurisdiction over the port where 
longshore work will be performed, and return to the employer, or the 
employer's agent or representative at a U.S. address, one copy of the 
attestation form submitted by the employer, with ETA's acceptance 
indicated thereon. The employer may then use alien crewmembers for the 
particular activity of longshore work at the U.S. port cited in the 
attestation in accordance with DHS regulations.
    (ii) DOL is not the guarantor of the accuracy, truthfulness or 
adequacy of an attestation accepted for filing.
    (2) Unacceptable attestations. ETA shall not accept an attestation 
for filing and shall return such attestation to the employer, or the 
employer's agent or representative at a U.S. address, when one of the 
following conditions exists:
    (i) When the Form ETA 9033 is not properly filled out. Examples of 
improperly filled out Form ETA 9033's include instances where the 
employer has neglected to check all the necessary boxes, or where the 
employer has failed to include the name of the port where it intends to 
use the alien crewmembers for longshore work, or where the employer has 
named a port that is not listed in appendix A and has failed to submit 
facts and evidence to support a showing that the location is a port as 
defined bySec. 655.502, or when the employer has failed to sign the 
attestation or to designate an agent in the United States;
    (ii) When the Form ETA 9033 with accompanying documentation is not 
received by ETA at least 14 days prior to the date of performance of the 
first activity indicated on the Form ETA 9033; unless the employer is 
claiming an unanticipated emergency, has included documentation which 
supports such claim, and ETA has found the claim to be valid;
    (iii) When the Form ETA 9033 does not include accompanying 
documentation for each of the requirements set forth atSec. 655.510 
(d) through (f);
    (iv) When the accompanying documentation required by paragraph (c) 
of this section submitted by the employer, on its face, is inconsistent 
with the requirements set forth atSec. 655.510 (d) through (f). 
Examples of such a situation include instances where the Form ETA 9033 
pertains to one port and the accompanying documentation to another; 
where the Form ETA 9033 pertains to one activity of longshore work and 
the accompanying documentation obviously refers to another; or where the 
documentation clearly indicates that only thirty percent, instead of the 
required fifty percent, of the activity attested to is performed by 
alien crewmembers;
    (v) When the Administrator, Wage and Hour Division, has notified 
ETA, in writing, after an investigation pursuant to subpart G of this 
part, that the particular activity of longshore work which the employer 
has attested is the prevailing practice at a particular port, is not, in 
fact, the prevailing practice at the particular port;
    (vi) When the Administrator, Wage and Hour Division, has notified 
ETA, in writing, that a cease and desist order has been issued pursuant 
to subpart G of this part, with respect to the attesting employer's 
performance of the particular activity and port, in violation of a 
previously accepted attestation;
    (vii) When the Administrator, Wage and Hour Division, has notified 
ETA, in writing, after an investigation pursuant to subpart G of this 
part, that the particular employer has misrepresented or failed to 
comply with an attestation previously submitted and accepted for filing, 
but in no case for a period of more than one year after the date of the 
Administrator's notice and provided that DHS has not advised ETA that 
the prohibition is in effect for a lesser period; or
    (viii) When the Administrator, Wage and Hour Division, has notified 
ETA, in writing, that the employer has failed to comply with any 
penalty, sanction, or other remedy assessed in a final agency action 
following an investigation by the Wage and Hour Division pursuant to 
subpart G of this part.
    (3) Resubmission. If the attestation is not accepted for filing 
pursuant to the categories set forth in paragraph (g)(2) of this 
section, ETA shall return to the employer, or the employer's agent or 
representative, at a U.S. address, the

[[Page 614]]

attestation form and accompanying documentation submitted by the 
employer. ETA shall notify the employer, in writing, of the reason(s) 
that the attestation is unacceptable. When an attestation is found to be 
unacceptable pursuant to paragraphs (g)(2) (i) through (iv) of this 
section, the employer may resubmit the attestation with the proper 
documentation. When an attestation is found to be unacceptable pursuant 
to paragraphs (g)(2) (v) through (viii) of this section and returned, 
such action shall be the final decision of the Secretary of Labor.
    (h) Effective date and validity of filed attestations. An 
attestation is filed and effective as of the date it is accepted and 
signed by the Certifying Officer. Such attestation is valid for the 12-
month period beginning on the date of acceptance for filing, unless 
suspended or invalidated pursuant to subpart G of this part or paragraph 
(i) of this section. The filed attestation expires at the end of the 12-
month period of validity.
    (i) Suspension or invalidation of filed attestations. Suspension or 
invalidation of an attestation may result from enforcement action(s) 
under subpart G of this part (i.e., investigation(s) conducted by the 
Administrator or cease and desist order(s) issued by the Administrator 
regarding the employer's misrepresentation in or failure to carry out 
its attestation); or from a discovery by ETA that it made an error in 
accepting the attestation because such attestation falls within one of 
the categories set forth in paragraph (g)(2) of this section.
    (1) Result of Wage and Hour Division action. Upon the determination 
of a violation under subpart G of this part, the Administrator shall, 
pursuant toSec. 655.660(b), notify the DHS of the violation and of the 
Administrator's notice to ETA.
    (2) Result of ETA action. If, after accepting an attestation for 
filing, ETA finds that the attestation is unacceptable because it falls 
within one of the categories set forth at paragraph (g)(2) of this 
section, and as a result, ETA suspends or invalidates the attestation, 
ETA shall notify the DHS of such suspension or invalidation and shall 
return a copy of the attestation form to the employer, or the employer's 
agent or representative, at a U.S. address. ETA shall notify the 
employer, in writing, of the reason(s) that the attestation is suspended 
or invalidated. When an attestation is found to be suspended or 
invalidated pursuant to paragraphs (g)(2) (i) through (iv) of this 
section, the employer may resubmit the attestation with the proper 
documentation. When an attestation is suspended or invalidated because 
it falls within one of the categories in paragraphs (g)(2) (v) through 
(viii) of this section, such action shall be the final decision of the 
Secretary of Labor, except as set forth in subpart G of this part.
    (j) Withdrawal of accepted attestations. (1) An employer who has 
submitted an attestation which has been accepted for filing may withdraw 
such attestation at any time before the 12-month period of its validity 
terminates, unless the Administrator has found reasonable cause under 
subpart G to commence an investigation of the particular attestation. 
Such withdrawal may be advisable, for example, when the employer learns 
that the particular activity(ies) of longshore work which it has 
attested is the prevailing practice to perform with alien crewmembers 
may not, in fact, have been the prevailing practice at the particular 
port at the time of filing. Requests for such withdrawals shall be in 
writing and shall be directed to the Certifying Officer.
    (2) Withdrawal of an attestation shall not affect an employer's 
liability with respect to any failure to meet the conditions attested to 
which took place before the withdrawal, or for misrepresentations in an 
attestation. However, if an employer has not yet performed the 
particular longshore activity(ies) at the port in question, the 
Administrator will not find reasonable cause to investigate unless it is 
alleged, and there is reasonable cause to believe, that the employer has 
made misrepresentations in the attestation or documentation thereof, or 
that the employer has not in fact given the notice attested to.

(Approved by the Office of Management and Budget under Control No. 1205-
0309)

[60 FR 3956, 3976, Jan. 19, 1995, as amended at 71 FR 35520, June 21, 
2006]

[[Page 615]]



Sec.  655.520  Special provisions regarding automated vessels.

    In general, an attestation is not required in the case of a 
particular activity of longshore work consisting of the use of automated 
self-unloading conveyor belt or vacuum-actuated systems on a vessel. The 
legislation creates a rebuttable presumption that the use of alien 
crewmembers for the operation of such automated systems is the 
prevailing practice. In order to overcome such presumption, it must be 
shown by the preponderance of the evidence submitted by any interested 
party, that the use of alien crewmembers for such activity is not the 
prevailing practice. Longshore work involving the use of such equipment 
shall be exempt from the attestation requirement only if the activity 
consists of using that equipment. If the automated equipment is not used 
in the particular activity of longshore work, an attestation is required 
as described underSec. 655.510 of this part if it is the prevailing 
practice in the port to use alien crewmembers for this work, except that 
in all cases, where an attestation is required for longshore work to be 
performed at a particular location in the State of Alaska, an employer 
shall file such attestation under the Alaska exception pursuant to 
Sec.Sec. 655.530 through 655.541 on Form ETA 9033-A. When automated 
equipment is used in the particular activity of longshore work, an 
attestation is required only if the Administrator finds, based on a 
preponderance of the evidence which may be submitted by any interested 
party, that the performance of the particular activity of longshore work 
is not the prevailing practice at the port, or was during a strike or 
lockout or intended to influence an election of a bargaining 
representative for workers in the local port, or if the Administrator 
issues a cease and desist order against use of the automated equipment 
without such attestation.
    (a) Procedure when attestation is required. If it is determined 
pursuant to subpart G of this part that an attestation is required for 
longshore work consisting of the use of automated equipment at a 
location other than in the State of Alaska, the employer shall comply 
with all the requirements set forth atSec. 655.510 of this part except 
paragraph (d) ofSec. 655.510. In lieu of complying withSec. 
655.510(d) of this part, the employer shall comply with paragraph (b) of 
this section. If it is determined pursuant to subpart G of this part 
that an attestation is required for longshore work consisting of the use 
of automated equipment at a particular location in the State of Alaska, 
the employer shall comply with all the requirements set forth at 
Sec.Sec. 655.530 through 655.541 of this part.
    (b) The first attestation element: prevailing practice for automated 
vessels. For an employer to be in compliance with the first attestation 
element, it is required to have been the prevailing practice that over 
fifty percent (as described in paragraph (b)(1) of this section) of a 
particular activity of longshore work which was performed through the 
use of automated self-unloading conveyor belt or vacuum-actuated 
equipment at the particular port during the 12-month period preceding 
the filing of the attestation, was performed by alien crewmembers. For 
purposes of this paragraph (b), only automated vessels shall be included 
in counting the number of vessels which dock at the port.
    (1) Establishing a prevailing practice. (i) In establishing that the 
use of alien crewmembers to perform a particular activity of longshore 
work consisting of the use of self-unloading conveyor belt or vacuum-
actuated systems on a vessel is the prevailing practice at a particular 
port, an employer shall submit facts and evidence to show that in the 
12-month period preceding the filing of the attestation, one of the 
following conditions existed:
    (A) Over fifty percent of the automated vessels docking at the port 
used alien crewmembers for the activity (for purposes of this paragraph 
(b)(1), a vessel shall be counted each time it docks at the particular 
port); or
    (B) Alien crewmembers made up over fifty percent of the workers who 
performed the activity with respect to such automated vessels.
    (ii) Prevailing practice after Secretary of State determination of 
non-reciprocity. Section 258(d) of the Act provides a reciprocity 
exception (separate from the prevailing practice exception) to the

[[Page 616]]

prohibition on performance of longshore work by alien crewmembers in 
U.S. ports. However, this reciprocity exception becomes nonapplicable 
where the Secretary of State determines that, for a particular activity 
of longshore work, a particular country (by law, regulation, or 
practice) prohibits such activity by U.S. crewmembers in its ports. When 
the Secretary of State places a country on the non-reciprocity list 
(which means, for the purposes of this section, Prohibitions on 
longshore work by U.S. nationals; listing by country at 22 CFR 89.1), 
crewmembers on vessels from that country (that is, vessels that are 
registered in that country or vessels whose majority ownership interest 
is held by nationals of that country) are not permitted to perform 
longshore work in U.S. waters, absent applicability of some exception 
other than the reciprocity exception. The Secretary of State's 
determination has the following effects in the establishment of a 
prevailing practice for a particular longshore activity at a particular 
U.S. port for purposes of the prevailing practice exception.
    (A) An employer from any country, other than the country which is 
placed on the non-reciprocity list, may include the longshore activities 
performed by alien crewmembers on all vessels in establishing the 
prevailing practice for a particular longshore activity in a particular 
port.
    (B) An employer from a country which is placed on the non-
reciprocity list may file an attestation for the prevailing practice 
exception under the standards and requirements established in this 
subpart F (except as provided in paragraph (b)(1)(ii)(C) of this 
section), provided that the attestation is filed at least 12 months 
after the date on which the employer's country is placed on the list.
    (C) An employer from a country which is placed on the non-
reciprocity list may file an attestation pursuant to the prevailing 
practice exception earlier than 12 months from the date on which the 
employer's country is placed on the list, except that the following 
restrictions shall apply to such attestation:
    (1) The employer shall submit facts and evidence to show that, for 
the 12-month period preceding the date of the attestation, the use of 
alien crewmembers to perform a particular activity of longshore work was 
permitted by the prevailing practice in the port (as defined in 
paragraph (d)(1)(i) of this section) without considering or including 
such activity by crewmembers on vessels from the employer's country; or
    (2) The employer shall submit facts and evidence (including data on 
activities performed by crewmembers on vessels from the employer's 
country) to show that the use of alien crewmembers to perform a 
particular activity of longshore work was permitted by the prevailing 
practice in the port (as defined in paragraph (b)(1)(i) of this section) 
for one of two periods--
    (i) For the employer whose country has not previously been on the 
non-reciprocity list, the period is the continuous 12-month period prior 
to May 28, 1991 (the effective date of section 258 of the Act); or
    (ii) For the employer whose country was at some time on the non-
reciprocity list, but was subsequently removed from the non-reciprocity 
list and then restored to the non-reciprocity list (on one or more 
occasions), the period is the last continuous 12-month period during 
which the employer's country was not under the reciprocity exception 
(that is, was listed on the non-reciprocity list).
    (2) Documentation. In assembling the documentation described in 
paragraph (b)(1) of this section, the employer may consult with the port 
authority which has jurisdiction over the local port, the collective 
bargaining representative(s) of longshore workers at the local port, 
other employers, or any other entity which is familiar with the 
practices at the port. The documentation shall include a written summary 
of a survey of the experience of shipmasters who entered the local port 
in the previous year; or a letter, affidavit, or other written statement 
from an appropriate local port authority regarding the use of alien 
crewmembers to perform the longshore activity at the port in the 
previous year; or other documentation of comparable weight. Written 
statements from collective bargaining representatives and/or shipping 
agents

[[Page 617]]

with direct knowledge of practices regarding the use of alien 
crewmembers may also be pertinent. Such documentation shall accompany 
the Form ETA 9033, and any underlying documentation which supports the 
employer's burden of proof shall be maintained in the employer's records 
at the office of the U.S. agent as required underSec. 655.510(c)(1) of 
this part.

(Approved by the Office of Management and Budget under Control No. 1205-
0309)

                            Alaska Exception



Sec.  655.530  Special provisions regarding the performance of 
longshore activities at locations in the State of Alaska.

    Applicability. SectionSec. 655.510 of this part shall not apply to 
longshore work performed at locations in the State of Alaska. The 
performance of longshore work by alien crewmembers at locations in the 
State of Alaska shall instead be governed by Sec.Sec. 655.530 through 
655.541. The use of alien crewmembers to perform longshore work in 
Alaska consisting of the use of an automated self-unloading conveyor 
belt or vacuum-actuated system on a vessel shall continue to be governed 
by the provisions ofSec. 655.520 of this part, except that, if the 
Administrator finds, based on a preponderance of the evidence which may 
be submitted by any interested party, that an attestation is required 
because the performance of the particular activity of longshore work is 
not the prevailing practice at the location in the State of Alaska, or 
was during a strike or lockout or intended to influence an election of a 
bargaining representative for workers at that location, or if the 
Administrator issues a cease and desist order against use of the 
automated equipment without such an attestation, the required 
attestation shall be filed pursuant to the Alaska exception at 
Sec.Sec. 655.530 through 655.541 and not the prevailing practice 
exception atSec. 655.510.



Sec.  655.531  Who may submit attestations for locations in Alaska?

    In order to use alien crewmembers to perform longshore activities at 
a particular location in the State of Alaska an employer shall submit an 
attestation on Form ETA 9033-A. As noted atSec. 655.502, 
``Definitions,'' for purposes of Sec.Sec. 655.530 through 655.541, 
which govern the performance of longshore activities by alien 
crewmembers under the Alaska exception, ``employer'' includes any agent 
or representative designated by the employer. An employer may file a 
single attestation for multiple locations in the State of Alaska.



Sec.  655.532  Where and when should attestations be submitted for
locations in Alaska?

    (a) Attestations shall be submitted, by U.S. mail, private carrier, 
or facsimile transmission to the U.S. Department of Labor regional 
office of the Employment and Training Administration in Seattle, 
Washington. Except as provided in paragraph (b) of this section, 
attestations shall be received and date-stamped by the Department at 
least 30 calendar days prior to the date of the first performance of the 
longshore activity. The attestation shall be accepted for filing or 
returned by ETA in accordance withSec. 655.538 within 14 calendar days 
of the date received by ETA. An attestation which is accepted by ETA 
solely because it was not reviewed within 14 days is subject to 
subsequent invalidation pursuant toSec. 655.540 of this part. An 
employer filing an attestation shall have an agent or representative 
with a United States address. Such address shall be clearly indicated on 
the Form ETA 9033-A. In order to ensure that an attestation has been 
accepted for filing prior to the date of the first performance of the 
longshore activity, employers are advised to take mailing time into 
account to make sure that ETA receives the attestation at least 30 days 
prior to the first performance of the longshore activity.
    (b) Late filings. ETA may accept for filing attestations received 
after the 30-day deadline where the employer could not have reasonably 
anticipated the need to file an attestation for the particular location 
at that time. When an employer states that it could not have reasonably 
anticipated the need to file the attestation at that time, it shall 
submit documentation to ETA to support such a claim. ETA shall then make 
a determination on the validity

[[Page 618]]

of the claim and shall accept the attestation for filing or return it in 
accordance withSec. 655.538 of this part. ETA in no case shall accept 
an attestation received less than 24 hours prior to the first 
performance of the activity.



Sec.  655.533  What should be submitted for locations in Alaska?

    (a) Form ETA 9033-A with accompanying documentation. A completed and 
dated original Form ETA 9033-A, or facsimile transmission thereof, 
containing the required attestation elements and the original signature 
of the employer or the employer's agent or designated representative, 
along with two copies of the completed, signed, and dated Form ETA 9033-
A shall be submitted to ETA. (If the attestation is submitted by 
facsimile transmission, the attestation containing the original 
signature shall be maintained at the U.S. business address of the 
employer's designated agent or representative). Copies of Form ETA 9033-
A are available at the National Processing Centers and at the National 
office. In addition, the employer shall submit two sets of facts and 
evidence to show compliance with the fourth attestation element atSec. 
655.537 of this part. In the case of an investigation pursuant to 
subpart G of this part, the employer has the burden of proof to 
establish the validity of each attestation. The employer shall maintain 
in its records at the office of its U.S. agent, for a period of at least 
3 years from the date of filing, sufficient documentation to meet its 
burden of proof, which shall at a minimum include the documentation 
described in Sec.Sec. 655.530 through 655.541, and shall make the 
documents available to Department of Labor officials upon request. 
Whenever any document is submitted to a Federal agency or retained in 
the employer's records pursuant to this part, the document shall either 
be in the English language or shall be accompanied by a written 
translation into the English language certified by the translator as to 
the accuracy of the translation and his/her competency to translate.
    (b) Attestation elements. The attestation elements referenced in 
Sec.Sec. 655.534 through 655.537 of this part are mandated by Sec. 
258(d)(1) of the Act (8 U.S.C. 1288(d)(1)). Section 258(d)(1) of the Act 
requires employers who seek to have alien crewmembers engage in 
longshore activity at locations in the State of Alaska to attest as 
follows:
    (1) The employer will make a bona fide request for United States 
longshore workers who are qualified and available in sufficient numbers 
to perform the activity at the particular time and location from the 
parties to whom notice has been provided underSec. 655.537(a)(1) (ii) 
and (iii), except that:
    (i) Wherever two or more contract stevedoring companies have signed 
a joint collective bargaining agreement with a single labor organization 
recognized as an exclusive bargaining representative of United States 
longshore workers within the meaning of the National Labor Relations Act 
(29 U.S.C. 141 et seq.), the employer may request longshore workers from 
only one such contract stevedoring company, and
    (ii) A request for longshore workers to an operator of a private 
dock may be made only for longshore work to be performed at that dock 
and only if the operator meets the requirements of section 32 of the 
Longshore and Harbor Workers' Compensation Act (33 U.S.C. 932);
    (2) The employer will employ all United States longshore workers 
made available in response to the request made pursuant toSec. 
655.534(a)(1) who are qualified and available in sufficient numbers and 
who are needed to perform the longshore activity at the particular time 
and location to which the employer has attested;
    (3) The use of alien crewmembers for such activity is not intended 
or designed to influence an election of a bargaining representative for 
workers in the State of Alaska; and
    (4) Notice of the attestation has been provided to:
    (i) Labor organizations which have been recognized as exclusive 
bargaining representatives of United States longshore workers within the 
meaning of the National Labor Relations Act (29 U.S.C. 141 et seq.) and 
which make available or intend to make available workers to the 
particular location where the longshore work is to be performed;

[[Page 619]]

    (ii) Contract stevedoring companies which employ or intend to employ 
United States longshore workers at that location; and
    (iii) Operators of private docks at which the employer will use 
longshore workers.

[60 FR 3956, 3976, Jan. 19, 1995, as amended at 71 FR 35520, June 21, 
2006]



Sec.  655.534  The first attestation element for locations in Alaska:
Bona fide request for dispatch of United States longshore workers.

    (a) The first attestation element shall be satisfied when the 
employer signs Form ETA 9033-A, attesting that, before using alien 
crewmembers to perform longshore work during the validity period of the 
attestation, the employer will make a bona fide request for United 
States longshore workers who are qualified and available in sufficient 
numbers to perform the specified longshore activity from the parties to 
whom notice is provided underSec. 655.537(a)(1) (ii) and (iii). 
Although an employer is required to provide notification of filing to 
labor organizations recognized as exclusive bargaining representatives 
of United States longshore workers pursuant toSec. 655.537(a)(1)(i) of 
this part, an employer need not request dispatch of United States 
longshore workers directly from such parties. The requests for dispatch 
of United States longshore workers pursuant to this section shall be 
directed to contract stevedoring companies which employ or intend to 
employ United States longshore workers at that location, and to 
operators of private docks at which the employer will use longshore 
workers. An employer is not required to request dispatch of United 
States longshore workers from private dock operators or contract 
stevedoring companies which do not meet the requirements of section 32 
of the Longshore and Harbor Workers' Compensation Act (33 U.S.C. 932) 
or, in the case of contract stevedoring companies, which are not 
licensed to do business in the State of Alaska.
    (1) Wherever two or more contract stevedoring companies have signed 
a joint collective bargaining agreement with a single qualified labor 
organization, the employer may request longshore workers from only one 
of such contract stevedoring companies. A qualified labor organization 
is one which has been recognized as an exclusive bargaining 
representative of United States longshore workers within the meaning of 
the National Labor Relations Act (29 U.S.C. 141 et seq.) and which makes 
available or intends to make available workers to the particular 
location where the longshore work is to be performed.
    (2) A request for longshore workers to an operator of a private dock 
may be made only for longshore work to be performed at that dock.
    (3) An employer shall not be required to request longshore workers 
from a party if that party has notified the employer in writing that it 
does not intend to make available United States longshore workers who 
are qualified and available in sufficient numbers to the time and 
location at which the longshore work is to be performed.
    (4) A party that has provided such written notice to the employer 
under paragraph (a)(3) of this section may subsequently notify the 
employer in writing that it is prepared to make available United States 
longshore workers who are qualified and available in sufficient numbers 
to perform the longshore activity at the time and location where the 
longshore work is to be performed. In that event, the employer's 
obligations to that party under Sec.Sec. 655.534 and 655.535 of this 
part shall recommence 60 days after its receipt of such notice.
    (5) When a party has provided written notice to the employer under 
paragraph (a)(3) of this section that it does not intend to dispatch 
United States longshore workers to perform the longshore work attested 
to by the employer, such notice shall expire upon the earliest of the 
following events:
    (i) When the terms of such notice specify an expiration date at 
which time the employer's obligation to that party under Sec.Sec. 
655.534 and 655.535 of this part shall recommence;
    (ii) When retracted pursuant to paragraph (a)(4) of this section; or
    (iii) Upon the expiration of the validity of the attestation.
    (b) Documentation. To substantiate the requirement in paragraph (a) 
of

[[Page 620]]

this section, an employer shall develop and maintain documentation to 
meet the employer's burden of proof under the first attestation element. 
The employer shall retain records of all requests for dispatch of United 
States longshore workers to perform the longshore work attested to. Such 
documentation shall consist of letters, telephone logs, facsimiles or 
other memoranda to show that, before using alien crewmembers to perform 
longshore work, the employer made a bona fide request for United States 
longshore workers who are qualified and available in sufficient numbers 
to perform the longshore activity. At a minimum, such documentation 
shall include the date the request was made, the name and telephone 
number of the particular individual(s) to whom the request for dispatch 
was directed, and the number and composition of full work units 
requested. Further, whenever any party has provided written notice to 
the employer under paragraph (a)(3) of this section, the employer shall 
retain the notice for the period of time specified inSec. 655.533 of 
this part, and, if appropriate, any subsequent notice by that party that 
it is prepared to make available United States longshore workers at the 
times and locations attested to.



Sec.  655.535  The second attestation element for locations in Alaska:
Employment of United States longshore workers.

    (a) The second attestation element shall be satisfied when the 
employer signs Form ETA 9033-A, attesting that during the validity 
period of the attestation, the employer will employ all United States 
longshore workers made available in response to the request for dispatch 
who, in compliance with applicable industry standards in the State of 
Alaska, including safety considerations, are qualified and available in 
sufficient numbers and are needed to perform the longshore activity at 
the particular time and location attested to.
    (1) In no case shall an employer filing an attestation be required 
to hire less than a full work unit of United States longshore workers 
needed to perform the longshore activity nor be required to provide 
overnight accommodations for the longshore workers while employed. For 
purposes of this section, ``full work unit'' means the full complement 
of longshore workers needed to perform the longshore activity, as 
determined by industry standards in the State of Alaska, including 
safety considerations. Where the makeup of a full work unit is covered 
by one or more collective bargaining agreements in effect at the time 
and location where longshore work is to be performed, the provisions of 
such agreement(s) shall be deemed to be in conformance with industry 
standards in the State of Alaska.
    (2) In no case shall an employer be required to provide 
transportation to the vessel where the longshore work is to be 
performed, except where:
    (i) Surface transportation is available; for purposes of this 
section, ``surface transportation'' means a tugboat or other vessel 
which is appropriately insured, operated by licensed personnel, and 
capable of safely transporting U.S. longshore workers from shore to a 
vessel on which longshore work is to be performed;
    (ii) Such transportation may be safely accomplished; and
    (iii)(A) Travel time to the vessel does not exceed one-half hour 
each way; and
    (B) Travel distance to the vessel from the point of embarkation does 
not exceed 5 miles; for purposes of this section, ``point of 
embarkation'' means a dock or landing at which U.S. longshore workers 
may be safely boarded for transport from shore to a vessel on which 
longshore work is to be performed; or
    (C) In the cases of Wide Bay, Alaska, and Klawock/Craig, Alaska, 
travel time does not exceed 45 minutes each way and travel distance to 
the vessel from the point of embarkation does not exceed 7.5 miles, 
unless the party responding to the request for dispatch agrees to lesser 
time and distance specifications.
    (3) If a United States longshore worker is capable of getting to and 
from the vessel where longshore work is to be performed when the vessel 
is beyond the time and distance limitations specified in paragraph 
(a)(2)(iii) of this section, and where all of the other criteria 
governing the employment of United

[[Page 621]]

States longshore workers under this subpart are met (e.g., ``qualified 
and available in sufficient numbers''), the employer is still obligated 
to employ the worker to perform the longshore activity. In such 
instance, however, the employer shall not be required to provide such 
transportation nor to reimburse the longshore worker for the cost 
incurred in transport to and from the vessel.
    (4) Where an employer is required to provide transportation to the 
vessel because it is within the time and distance limitations specified 
in (a)(2)(iii) of this section, the employer also shall be required to 
provide return transportation to the point of embarkation.
    (b) Documentation. To substantiate the requirement in paragraph (a) 
of this section, an employer shall develop and maintain documentation to 
meet the employer's burden of proof. Such documentation shall include 
records of payments to contract stevedoring companies or private dock 
operators, payroll records for United States longshore workers employed, 
or other documentation to show clearly that the employer has met its 
obligation to employ all United States longshore workers made available 
in response to a request for dispatch who are qualified and available in 
sufficient numbers. The documentation shall specify the number of full 
work units employed pursuant to this section, the composition of such 
full work units (i.e., number of workers by job title), and the date(s) 
and location(s) where the longshore work was performed. The employer 
also shall develop and maintain documentation concerning the provision 
of transportation from the point of embarkation to the vessel on which 
longshore work is to be performed. Each time one or more United States 
longshore workers are dispatched in response to the request underSec. 
655.534, the employer shall retain a written record of whether 
transportation to the vessel was provided and the time and distance from 
the point of embarkation to the vessel.



Sec.  655.536  The third attestation element for locations in Alaska:
No intention or design to influence bargaining representative election.

    (a) The employer shall attest that use of alien crewmembers to 
perform the longshore activity specified on the Form ETA 9033-A is not 
intended or designed to influence an election of a bargaining 
representative for workers in the State of Alaska.
    (b) Documentation. The employer need not develop nor maintain 
documentation to substantiate the statement referenced in paragraph (a) 
of this section. In the case of an investigation, however, the employer 
has the burden of proof to show that the use of alien crewmembers to 
perform the longshore activity specified on the Form ETA 9033-A was not 
intended nor designed to influence an election of a bargaining 
representative for workers in the State of Alaska.



Sec.  655.537  The fourth attestation element for locations in Alaska:
Notice of filing.

    (a)(1) The employer shall attest that at the time of filing the 
attestation, notice of filing has been provided to:
    (i) Labor organizations which have been recognized as exclusive 
bargaining representatives of United States longshore workers within the 
meaning of the National Labor Relations Act (29 U.S.C. 141 et seq.) and 
which make available or intend to make available workers to the 
particular location where the longshore work is to be performed;
    (ii) Contract stevedoring companies which employ or intend to employ 
United States longshore workers at the location where the longshore work 
is to be performed; and
    (iii) Operators of private docks at which the employer will use 
longshore workers.
    (2) The notices provided under paragraph (a)(1) of this section 
shall include a copy of the Form ETA 9033-A to be submitted to ETA, 
shall provide information concerning the availability of supporting 
documents for public examination at the national office of ETA, and 
shall include the following statement: ``Complaints alleging a 
misrepresentation of material facts in the

[[Page 622]]

attestation and/or failure to comply with the terms of the attestation 
may be filed with any office of the Wage and Hour Division of the United 
States Department of Labor.''
    (b) The employer shall request a copy of the Certificate of 
Compliance issued by the district director of the Office of Workers' 
Compensation Programs under section 37 of the Longshore and Harbor 
Workers' Compensation Act (33 U.S.C. 932) from the parties to whom 
notice is provided pursuant to paragraphs (a)(1) (ii) and (iii) of this 
section. An employer's obligation to make a bona fide request for 
dispatch of U.S. longshore workers underSec. 655.534 of this part 
before using alien crewmembers to perform the longshore work attested to 
shall commence upon receipt of the copy of the Certificate of 
Compliance.
    (c) Documentation. The employer shall develop and maintain 
documentation sufficient to meet its burden of proving the validity of 
the statement referenced in paragraphs (a) and (b) of this section and 
attested to on the Form ETA 9033-A. Such documentation shall include a 
copy of the notices provided, as required by paragraph (a)(1) of this 
section, and shall be submitted to ETA along with the Form ETA 9033-A.



Sec.  655.538  Actions on attestations submitted for filing for 
locations in Alaska.

    Once an attestation has been received from an employer, a 
determination shall be made by the Certifying Officer whether to accept 
the attestation for filing or return it. The Certifying Officer may 
request additional explanation and/or documentation from the employer in 
making this determination. An attestation which is properly filled out 
and which includes accompanying documentation for the requirement set 
forth atSec. 655.537 of this part shall be accepted for filing by ETA 
on the date it is signed by the Certifying Officer unless it falls 
within one of the categories set forth in paragraph (b) of this section. 
Once an attestation is accepted for filing, ETA shall then follow the 
procedures set forth in paragraph (a)(1) of this section. Upon 
acceptance of the employer's attestation by ETA, the attestation and 
accompanying documentation shall be forwarded to and be available for 
public examination at the ETA national office in a timely manner. ETA 
shall not consider information contesting an attestation received by ETA 
prior to the determination to accept or return the attestation for 
filing. Such information shall not be made a part of ETA's 
administrative record on the attestation, but shall be referred to ESA 
to be processed as a complaint pursuant to subpart G of this part if the 
attestation is accepted by ETA for filing.
    (a) Acceptance. (1) If the attestation is properly filled out and 
includes accompanying documentation for the requirement set forth at 
Sec.  655.537, and does not fall within one of the categories set forth 
at paragraph (b) of this section, ETA shall accept the attestation for 
filing, provide notification to the DHS office having jurisdiction over 
the location where longshore work will be performed, and return to the 
employer, or the employer's agent or representative at a U.S. address, 
one copy of the attestation form submitted by the employer, with ETA's 
acceptance indicated thereon. Before using alien crewmembers to perform 
the longshore work attested to on Form ETA 9033-A, the employer shall 
make a bona fide request for and employ United States longshore workers 
who are qualified and available in sufficient numbers pursuant to 
Sec.Sec. 655.534 and 655.535. Where such a request for dispatch of 
United States longshore workers is unsuccessful, either in whole or in 
part, any use of alien crewmembers to perform longshore activity shall 
be in accordance with DHS regulations.
    (2) DOL is not the guarantor of the accuracy, truthfulness or 
adequacy of an attestation accepted for filing.
    (b) Unacceptable attestations. ETA shall not accept an attestation 
for filing and shall return such attestation to the employer, or the 
employer's agent or representative at a U.S. address, when any one of 
the following conditions exists:
    (1) When the Form ETA 9033-A is not properly filled out. Examples of 
improperly filled out Form ETA 9033-A's include instances where the 
employer has neglected to check all the necessary boxes, where the 
employer has

[[Page 623]]

failed to include the name of any port, city, or other geographical 
reference point where longshore work is to be performed, or where the 
employer has failed to sign the attestation or to designate an agent in 
the United States.
    (2) When the Form ETA 9033-A with accompanying documentation is not 
received by ETA at least 30 days prior to the first performance of the 
longshore activity, unless the employer is claiming that it could not 
have reasonably anticipated the need to file the attestation for that 
location at that time, and has included documentation which supports 
this contention, and ETA has found the claim to be valid.
    (3) When the Form ETA 9033-A does not include accompanying 
documentation for the requirement set forth atSec. 655.537.
    (4) When the accompanying documentation submitted by the employer 
and required bySec. 655.537, on its face, is inconsistent with that 
section. Examples of such a situation include an instance where the Form 
ETA 9033-A indicates that the longshore work will be performed at a 
particular private dock and the documentation required under the notice 
attestation element indicates that notice was provided to an operator of 
a different private dock, or where the longshore work is to be performed 
at a particular time and location in the State of Alaska and the notice 
of filing provided to qualified labor organizations and contract 
stevedoring companies indicates that the longshore work is to be 
performed at a different time and/or location.
    (5) When the Administrator, Wage and Hour Division, has notified 
ETA, in writing, after an investigation pursuant to subpart G of this 
part, that a cease and desist order has been issued pursuant to subpart 
G of this part, with respect to the attesting employer's performance of 
longshore work at a particular location in the State of Alaska, in 
violation of a previously accepted attestation.
    (6) When the Administrator, Wage and Hour Division, has notified 
ETA, in writing, after an investigation pursuant to subpart G of this 
part, that the particular employer has misrepresented or failed to 
comply with an attestation previously submitted and accepted for filing, 
but in no case for a period of more than one year after the date of the 
Administrator's notice and provided that DHS has not advised ETA that 
the prohibition is in effect for a lesser period.
    (7) When the Administrator, Wage and Hour Division, has notified 
ETA, in writing, that the employer has failed to comply with any 
penalty, sanction, or other remedy assessed in a final agency action 
following an investigation by the Wage and Hour Division pursuant to 
subpart G of this part.
    (c) Resubmission. If the attestation is not accepted for filing 
pursuant to paragraph (b) of this section, ETA shall return to the 
employer, or the employer's agent or representative, at a U.S. address, 
the attestation form and accompanying documentation submitted by the 
employer. ETA shall notify the employer, in writing, of the reason(s) 
that the attestation is unacceptable. When an attestation is found to be 
unacceptable pursuant to paragraph (b) (1), (2), (3), or (4) of this 
section, the employer may resubmit the corrected attestation with the 
proper documentation. When an attestation is found to be unacceptable 
pursuant to paragraph (b) (5), (6), or (7) of this section and returned, 
such action shall be the final decision of the Secretary of Labor.



Sec.  655.539  Effective date and validity of filed attestations for
locations in Alaska.

    An attestation is filed and effective as of the date it is accepted 
and signed by the Certifying Officer. Such attestation is valid for the 
12-month period beginning on the date of acceptance for filing, unless 
suspended or invalidated pursuant toSec. 655.540 of this part. The 
filed attestation expires at the end of the 12-month period of validity.



Sec.  655.540  Suspension or invalidation of filed attestations for
locations in Alaska.

    Suspension or invalidation of an attestation may result from 
enforcement action(s) under subpart G of this part (i.e., 
investigation(s) conducted by the Administrator or cease and desist 
order(s) issued by the Administrator

[[Page 624]]

regarding the employer's misrepresentation in or failure to carry out 
its attestation); or from a discovery by ETA that it made an error in 
accepting the attestation because such attestation falls within one of 
the categories set forth inSec. 655.538(b).
    (a) Result of Wage and Hour Division action. Upon the determination 
of a violation under subpart G of this part, the Administrator shall, 
pursuant toSec. 655.665(b), notify the DHS of the violation and of the 
Administrator's notice to ETA.
    (b) Result of ETA action. If, after accepting an attestation for 
filing, ETA finds that the attestation is unacceptable because it falls 
within one of the categories set forth atSec. 655.538(b) and, as a 
result, ETA suspends or invalidates the attestation, ETA shall notify 
the DHS of such suspension or invalidation and shall return a copy of 
the attestation form to the employer, or the employer's agent or 
representative at a U.S. address. ETA shall notify the employer, in 
writing, of the reason(s) that the attestation is suspended or 
invalidated.



Sec.  655.541  Withdrawal of accepted attestations for locations 
in Alaska.

    (a) An employer who has submitted an attestation which has been 
accepted for filing may withdraw such attestation at any time before the 
12-month period of its validity terminates, unless the Administrator has 
found reasonable cause under subpart G to commence an investigation of 
the particular attestation. Such withdrawal may be advisable, for 
example, when the employer learns that the country in which the vessel 
is registered and of which nationals of such country hold a majority of 
the ownership interest in the vessel has been removed from the non-
reciprocity list (which means, for purposes of this section, 
Prohibitions on longshore work by U.S. nationals; listing by country at 
22 CFR 89.1). In that event, an attestation would no longer be required 
under subpart F of this part, since upon being removed from the non-
reciprocity list the performance of longshore work by alien crewmembers 
would be permitted under the reciprocity exception at sec. 258(e) of the 
Act (8 U.S.C. 1288(e)). Requests for withdrawals shall be in writing and 
shall be directed to the Certifying Officer.
    (b) Withdrawal of an attestation shall not affect an employer's 
liability with respect to any failure to meet the conditions attested to 
which took place before the withdrawal, or for misrepresentations in an 
attestation. However, if an employer has not yet performed the longshore 
activities at the location(s) in question, the Administrator shall not 
find reasonable cause to investigate unless it is alleged, and there is 
reasonable cause to believe, that the employer has made 
misrepresentations in the attestation or documentation thereof, or that 
the employer has not in fact given the notice attested to.

                              Public Access



Sec.  655.550  Public access.

    (a) Public examination at ETA. ETA shall make available for public 
examination in Washington, DC, a list of employers which have filed 
attestations under this subpart, and for each such employer, a copy of 
the employer's attestation and accompanying documentation it has 
received.
    (b) Notice to public. ETA periodically shall publish a list in the 
Federal Register identifying under this subpart employers which have 
submitted attestations; employers which have attestations on file; and 
employers which have submitted attestations which have been found 
unacceptable for filing.

(Approved by the Office of Management and Budget under Control No. 1205-
0309)



         Sec. Appendix A to Subpart F of Part 655--U.S. Seaports

    The list of 224 seaports includes all major and most smaller ports 
serving ocean and Great Lakes commerce.

                          North Atlantic Range

Bucksport, ME
Eastport, ME
Portland, ME
Searsport, ME
Portsmouth, NH
Boston, MA
Fall River, MA
New Bedford, MA
Providence, RI
Bridgeport, CT

[[Page 625]]

New Haven, CT
New London, CT
Albany, NY
New York, NY/NJ
Camden, NJ
Gloucester City, NJ
Paulsboro, NJ
Chester, PA
Marcus Hook, PA
Philadelphia, PA
Delaware City, DE
Wilmington, DE
Baltimore, MD
Cambridge, MD
Alexandria, VA
Chesapeake, VA
Hopewell, VA
Newport News, VA
Norfolk, VA
Portsmouth, VA
Richmond, VA

                          South Atlantic Range

Morehead City, NC
Southport, NC
Wilmington, NC
Charleston, SC
Georgetown, SC
Port Royal, SC
Brunswick, GA
Savannah, GA
St. Mary, GA
Cocoa, FL
Fernandina Beach, FL
Fort Lauderdale, FL
Fort Pierce, FL
Jacksonville, FL
Miami, FL
Palm Beach, FL
Port Canaveral, FL
Port Everglades, FL
Riviera, FL
Aguadilla, PR
Ceiba, PR
Guanica, PR
Guayanilla, PR
Humacao, PR
Jobos, PR
Mayaguez, PR
Ponce, PR
San Juan, PR
Vieques, PR
Yabucoa, PR
Alucroix, VI
Charlotte Amalie, VI
Christiansted, VI
Frederiksted, VI
Limetree Bay, VI

                           North Pacific Range

Astoria, OR
Bandon, OR
Columbia City, OR
Coos Bay, OR
Mapleton, OR
Newport, OR
Portland, OR
Rainier, OR
Reedsport, OR
St. Helens, OR
Toledo, OR
Anacortes, WA
Bellingham, WA
Edmonds (Edwards Point), WA
Everett, WA
Ferndale, WA
Friday Harbor, WA
Grays Harbor, WA
Kalama, WA
Longview, WA
Olympia, WA
Point Wells, WA
Portage, WA
Port Angeles, WA
Port Gamble, WA
Port Townsend, WA
Raymond, WA
Seattle, WA
Tacoma, WA
Vancouver, WA
Willapa Harbor, WA
Winslow, WA

                            Great Lakes Range

Duluth, MN
Silver Bay, MN
Green Bay, WI
Kenosha, WI
Manitowoc, WI
Milwaukee, WI
Sheboygan, WI
Superior, WI
Alpena, MI
Bay City, MI
Detroit, MI
De Tour Village, MI
Essexville, MI
Ferrysburg, MI
Grand Haven, MI
Marine City, MI
Muskegon, MI
Port Huron, MI
Presque Isle, MI
Rogers City, MI
Saginaw, MI
Sault Ste Marie, MI
Chicago, IL
Ashtabula, OH
Cincinnati, OH
Cleveland, OH
Conneaut, OH
Fairport, OH
Huron, OH
Lorain, OH
Sandusky, OH
Toledo, OH
Erie, PA
Buffalo, NY
Odgensburg, NY
Oswego, NY
Rochester, NY
Burns Harbor, IN
E. Chicago, IN

[[Page 626]]

Gary, IN

                            Gulf Coast Range

Panama City, FL
Pensacola, FL
Port Manatee, FL
Port St. Joe, FL
Tampa, FL
Mobile, AL
Gulfport, MS
Pascagoula, MS
Baton Rouge, LA
Gretna, LA
Lake Charles, LA
Louisiana Offshore Oil Port, LA
New Orleans, LA
Beaumont, TX
Brownsville, TX
Corpus Christi, TX
Freeport, TX
Galveston, TX
Harbor Island, TX
Houston, TX
Orange, TX
Port Arthur, TX
Port Isabel, TX
Port Lavaca, TX
Port Neches, TX
Sabine, TX
Texas City, TX

                           South Pacific Range

Alameda, CA
Antioch, CA
Benicia, CA
Carlsbad, CA
Carpinteria, CA
Crockett, CA
El Segundo, CA
Eureka, CA
Estero Bay, CA
Gaviota, CA
Huntington Beach, CA
Long Beach, CA
Los Angeles, CA
Mandalay Beach, CA
Martinez, CA
Moss Landing, CA
Oakland, CA
Pittsburg, CA
Port Costa, CA
Port Hueneme, CA
Port San Luis, CA
Redwood City, CA
Richmond, CA
Sacramento, CA
San Diego, CA
San Francisco, CA
Selby, CA
Stockton, CA
Vallejo, CA
Ventura, CA
Barbers Point, HI
Hilo, HI
Honolulu, HI
Kahului, HI
Kaunakakai, HI
Kawaihae, HI
Nawiliwili, HI
Port Allen, HI



  Subpart G_Enforcement of the Limitations Imposed on Employers Using 
        Alien Crewmembers for Longshore Activities in U.S. Ports

    Source: 60 FR 3969, 3977, Jan. 19, 1995, unless otherwise noted.



Sec.  655.600  Enforcement authority of Administrator, Wage and Hour Division.

    (a) The Administrator shall perform all the Secretary's 
investigative and enforcement functions under section 258 of the INA (8 
U.S.C. 1288) and subparts F and G of this part.
    (b) The Administrator, pursuant to a complaint, shall conduct such 
investigations as may be appropriate and, in connection therewith, enter 
and inspect such places and such records (and make transcriptions or 
copies thereof), question such persons and gather such information as 
deemed necessary by the Administrator to determine compliance regarding 
the matters which are the subject of the investigation.
    (c) An employer being investigated shall make available to the 
Administrator such records, information, persons, and places as the 
Administrator deems appropriate to copy, transcribe, question, or 
inspect. No employer subject to the provisions of section 258 of the INA 
(8 U.S.C. 1288) and subparts F and G of this part shall interfere with 
any official of the Department of Labor performing an investigation, 
inspection or law enforcement function pursuant to 8 U.S.C. 1288 or 
subpart F or G of this part. Any such interference shall be a violation 
of the attestation and subparts F and G of this part, and the 
Administrator may take such further actions as the Administrator 
considers appropriate. (Note: Federal criminal statutes prohibit certain 
interference with a Federal officer in the performance of official 
duties. 18 U.S.C. 111 and 18 U.S.C. 1114.)
    (d)(1) An employer subject to subparts F and G of this part shall at 
all times cooperate in administrative and

[[Page 627]]

enforcement proceedings. No employer shall intimidate, threaten, 
restrain, coerce, blacklist, discharge, retaliate, or in any manner 
discriminate against any person because such person has:
    (i) Filed a complaint or appeal under or related to section 258 of 
the INA (8 U.S.C. 1288) or subpart F or G of this part;
    (ii) Testified or is about to testify in any proceeding under or 
related to section 258 of the INA (8 U.S.C. 1288) or subpart F or G of 
this part;
    (iii) Exercised or asserted on behalf of himself or herself or 
others any right or protection afforded by section 258 of the INA (8 
U.S.C. 1288) or subpart F or G of this part.
    (iv) Consulted with an employee of a legal assistance program or an 
attorney on matters related to section 258 of the Act or to subpart F or 
G of this part or any other DOL regulation promulgated pursuant to 8 
U.S.C. 1288.
    (2) In the event of such intimidation or restraint as are described 
in paragraph (d)(1) of this section, the conduct shall be a violation of 
the attestation and subparts F and G of this part, and the Administrator 
may take such further actions as the Administrator considers 
appropriate.
    (e) The Administrator shall, to the extent possible under existing 
law, protect the confidentiality of any person who provides information 
to the Department in confidence in the course of an investigation or 
otherwise under subpart F or G of this part. However, confidentiality 
will not be afforded to the complainant or to information provided by 
the complainant.



Sec.  655.605  Complaints and investigative procedures.

    (a) The Administrator, through an investigation, shall determine 
whether a basis exists to make a finding that:
    (1) An attesting employer has--
    (i) Failed to meet conditions attested to; or
    (ii) Misrepresented a material fact in an attestation.
    (Note: Federal criminal statutes provide penalties of up to $10,000 
and/or imprisonment of up to 5 years for knowing and willful submission 
of false statements to the Federal Government. 18 U.S.C. 1001; see also 
18 U.S.C. 1546.); or
    (2) In the case of an employer operating under the automated vessel 
exception to the prohibition on utilizing alien crewmembers to perform 
longshore activity(ies) at a U.S. port, the employer--
    (i) Is utilizing alien crewmember(s) to perform longshore 
activity(ies) at a port where the prevailing practice has not been to 
use such workers for such activity(ies); or
    (ii) Is utilizing alien crewmember(s) to perform longshore 
activities:
    (A) During a strike or lockout in the course of a labor dispute at 
the U.S. port; and/or
    (B) With intent or design to influence an election of a bargaining 
representative for workers at the U.S. port; or
    (3) An employer failed to comply in any other manner with the 
provisions of subpart F or G of this part.
    (b) Any aggrieved person or organization may file a complaint of a 
violation of the provisions of subpart F or G of this part.
    (1) No particular form of complaint is required, except that the 
complaint shall be written or, if oral, shall be reduced to writing by 
the Wage and Hour Division official who receives the complaint.
    (2) The complaint shall set forth sufficient facts for the 
Administrator to determine--
    (i) Whether, in the case of an attesting employer, there is 
reasonable cause to believe that particular part or parts of the 
attestation or regulations have been violated; or
    (ii) Whether, in the case of an employer claiming the automated 
vessel exception, the preponderance of the evidence submitted by any 
interested party shows that conditions exist that would require the 
employer to file an attestation.
    (3) The complaint may be submitted to any local Wage and Hour 
Division office; the addresses of such offices are found in local 
telephone directories. The office or person receiving such a complaint 
shall refer it to the office of the Wage and Hour Division administering 
the area in which the reported violation is alleged to have occurred.
    (c) The Administrator shall determine whether there is reasonable 
cause to believe that the complaint warrants

[[Page 628]]

investigation. If the Administrator determines that the complaint fails 
to present reasonable cause for an investigation, the Administrator 
shall so notify the complainant, who may submit a new complaint, with 
such additional information as may be necessary. There shall be no 
hearing pursuant toSec. 655.625 for the Administrator's determination 
not to conduct an investigation. If the Administrator determines that an 
investigation on the complaint is warranted, the investigation shall be 
conducted and a determination issued within 180 calendar days of the 
Administrator's receipt of the complaint, or later for good cause shown.
    (d) In conducting an investigation, the Administrator may consider 
and make part of the investigation file any evidence or materials that 
have been compiled in any previous investigation regarding the same or a 
closely related matter.
    (e) In conducting an investigation under an attestation, the 
Administrator shall take into consideration the employer's burden to 
provide facts and evidence to establish the matters asserted. In 
conducting an investigation regarding an employer's eligibility for the 
automated vessel exception, the Administrator shall not impose the 
burden of proof on the employer, but shall consider all evidence from 
any interested party in determining whether the employer is not eligible 
for the exception.
    (f) In an investigation regarding the use of alien crewmembers to 
perform longshore activity(ies) in a U.S. port (whether by an attesting 
employer or by an employer claiming the automated vessel exception), the 
Administrator shall accept as conclusive proof a previous Departmental 
determination, published in the Federal Register pursuant toSec. 
655.670, establishing that such use of alien crewmembers is not the 
prevailing practice for the activity(ies) and U.S. port at issue. The 
Administrator shall give appropriate weight to a previous Departmental 
determination published in the Federal Register pursuant toSec. 
655.670, establishing that at the time of such determination, such use 
of alien crewmembers was the prevailing practice for the activity(ies) 
and U.S. port at issue.
    (g) When an investigation has been conducted, the Administrator 
shall, within the time period specified in paragraph (c) of this 
section, issue a written determination as to whether a basis exists to 
make a finding stated in paragraph (a) of this section. The 
determination shall be issued and an opportunity for a hearing shall be 
afforded in accordance with the procedures specified inSec. 655.625(d) 
of this part.



Sec.  655.610  Automated vessel exception to prohibition on 
utilization of alien crewmember(s) to perform longshore activity(ies)
at a U.S. port.

    (a) The Act establishes a rebuttable presumption that the prevailing 
practice in U.S. ports is for automated vessels (i.e., vessels equipped 
with automated self- unloading conveyor belts or vacuum-actuated 
systems) to use alien crewmembers to perform longshore activity(ies) 
through the use of the self-unloading equipment. An employer claiming 
the automated vessel exception does not have the burden of establishing 
eligibility for the exception.
    (b) In the event of a complaint asserting that an employer claiming 
the automated vessel exception is not eligible for such exception, the 
Administrator shall determine whether the preponderance of the evidence 
submitted by any interested party shows that:
    (1) It is not the prevailing practice at the U.S. port to use alien 
crewmember(s) to perform the longshore activity(ies) through the use of 
the self-unloading equipment; or
    (2) The employer is using alien crewmembers to perform longshore 
activity(ies)--
    (i) During a strike or lockout in the course of a labor dispute at 
the U.S. port; and/or
    (ii) With intent or design to influence an election of a bargaining 
representative for workers at the U.S. port.
    (c) In making the prevailing practice determination required by 
paragraph (b)(1) of this section, the Administrator shall determine 
whether, in the 12-month period preceding the date of the

[[Page 629]]

Administrator's receipt of the complaint, one of the following 
conditions existed:
    (1) Over fifty percent of the automated vessels docking at the port 
used alien crewmembers for the activity (for purposes of this paragraph 
(c)(1) of this section, a vessel shall be counted each time it docks at 
the particular port); or
    (2) Alien crewmembers made up over fifty percent of the workers who 
performed the activity with respect to such automated vessels.
    (d) An interested party, complaining that the automated vessel 
exception is not applicable to a particular employer, shall provide to 
the Administrator evidence such as:
    (1) A written summary of a survey of the experience of masters of 
automated vessels which entered the local port in the previous year, 
describing the practice in the port as to the use of alien crewmembers;
    (2) A letter, affidavit, or other written statement from an 
appropriate local port authority regarding the use of alien crewmembers 
to perform the longshore activity at the port in the previous year;
    (3) Written statements from collective bargaining representatives 
and/or shipping agents with direct knowledge of practices regarding the 
use of alien crewmembers at the port in the previous year.



Sec.  655.615  Cease and desist order.

    (a) If the Administrator determines that reasonable cause exists to 
conduct an investigation with respect to an attestation, the complainant 
may request that the Administrator enter a cease and desist order 
against the employer against whom the complaint is lodged.
    (1) The request for a cease and desist order may be filed along with 
the complaint, or may be filed subsequently. The request, including all 
accompanying documents, shall be filed in duplicate with the same Wage 
and Hour Division office that received the complaint.
    (2) No particular form is prescribed for a request for a cease and 
desist order pursuant to this paragraph (a). However, any such request 
shall:
    (i) Be dated;
    (ii) Be typewritten or legibly written;
    (iii) Specify the attestation provision(s) with respect to which the 
employer allegedly failed to comply and/or submitted 
misrepresentation(s) of material fact(s);
    (iv) Be accompanied by evidence to substantiate the allegation(s) of 
noncompliance and/or misrepresentation;
    (v) Be signed by the complaining party making the request or by the 
authorized representative of such party;
    (vi) Include the address at which such complaining party or 
authorized representative desires to receive further communications 
relating thereto.
    (3) Upon receipt of a request for a cease and desist order, the 
Administrator shall promptly notify the employer of the request. The 
Administrator's notice shall:
    (i) Inform the employer that it may respond to the request and meet 
with a Wage and Hour Division official within 14 calendar days of the 
date of the notice;
    (ii) Be served upon the employer by facsimile transmission, in 
person, or by certified or regular mail, at the address of the U.S. 
agent stated on the employer's attestation;
    (iii) Be accompanied by copies of the complaint, the request for a 
cease and desist order, the evidence submitted by the complainant, and 
any evidence from other investigation(s) of the same or a closely 
related matter which the Administrator may incorporate into the record. 
(Any such evidence from other investigation(s) shall also be made 
available for examination by the complaining party at the Wage and Hour 
Division office which issued the notice.)
    (4) No particular form is prescribed for the employer's response to 
the complaining party's request for a cease and desist order under this 
paragraph (a), however, any such response shall:
    (i) Be dated;
    (ii) Be submitted by facsimile transmission, in person, by certified 
or regular mail, or by courier service to the Wage and Hour Division 
office which issued the notice of the request;
    (iii) Be received by the appropriate Wage and Hour Division office 
no later than 14 calendar days from the date of the notice of the 
request;

[[Page 630]]

    (iv) Be typewritten or legibly written;
    (v) Explain, in any detail desired by the employer, the employer's 
grounds or reasons as to why the Administrator should deny the requested 
cease and desist order;
    (vi) Be accompanied by evidence to substantiate the employer's 
grounds or reasons as to why the Administrator should deny the requested 
cease and desist order;
    (vii) Specify whether the employer desires an informal meeting with 
a Wage and Hour Division official;
    (viii) Be signed by the employer or its authorized representative; 
and
    (ix) Include the address at which the employer or its authorized 
representative desires to receive further communications relating 
thereto, if such address is different from the address of the U.S. agent 
stated on the attestation.
    (5) In the event the employer requests a meeting with a Wage and 
Hour Division official, the Administrator shall provide the employer and 
the complaining party, or their authorized representatives, an 
opportunity for such a meeting to present their views regarding the 
evidence and arguments submitted by the parties. This shall be an 
informal meeting, not subject to any procedural rules. The meeting shall 
be held within the 14 calendar days permitted for the employer's 
response to the request for the cease and desist order, and shall be 
held at a time and place set by the Wage and Hour Division official, who 
shall notify the parties.
    (6) After receipt of the employer's timely response and after any 
informal meeting which may have been held with the parties, the 
Administrator shall promptly issue a written determination, either 
denying the request or issuing a cease and desist order. In making the 
determination, the Administrator shall consider all the evidence 
submitted, including any evidence from the same or a closely related 
matter which the Administrator has incorporated into the record and 
provided to the employer. If the Administrator determines that the 
complaining party's position is supported by a preponderance of the 
evidence submitted, the Administrator shall order that the employer 
cease the activities specified in the determination, until the 
completion of the Administrator's investigation and any subsequent 
proceedings pursuant toSec. 655.625 of this part, unless the 
prohibition is lifted by subsequent order of the Administrator because 
it is later determined that the employer's position was correct. While 
the cease and desist order is in effect, ETA shall suspend the subject 
attestation, either in whole or in part, and shall not accept any 
subsequent attestation from the employer for the activity(ies) and U.S. 
port or location in the State of Alaska at issue.
    (7) The Administrator's cease and desist order shall be served on 
the employer at the address of its designated U.S. based representative 
or at the address specified in the employer's response, by facsimile 
transmission, personal service, or certified mail.
    (b) If the Administrator determines that reasonable cause exists to 
conduct an investigation with respect to a complaint that a non-
attesting employer is not entitled to the automated vessel exception to 
the requirement for the filing of an attestation, a complaining party 
may request that the Administrator enter a cease and desist order 
against the employer against whom the complaint is lodged.
    (1) The request for a cease and desist order may be filed along with 
the complaint, or may be filed subsequently. The request, including all 
accompanying documents, shall be filed in duplicate with the same Wage 
and Hour Division office that received the complaint.
    (2) No particular form is prescribed for a request for a cease and 
desist order pursuant to this paragraph. However, any such request 
shall:
    (i) Be dated;
    (ii) Be typewritten or legibly written;
    (iii) Specify the circumstances which allegedly require that the 
employer be denied the use of the automated vessel exception;
    (iv) Be accompanied by evidence to substantiate the allegation(s);
    (v) Be signed by the complaining party making the request or by the 
authorized representative of such party; and

[[Page 631]]

    (vi) Include the address at which such complaining party or 
authorized representative desires to receive further communications 
relating thereto.
    (3) Upon receipt of a request for a cease and desist order, the 
Administrator shall notify the employer of the request. The 
Administrator's notice shall:
    (i) Inform the employer that it may respond to the request and meet 
with a Wage and Hour Division official within 14 calendar days of the 
date of the notice;
    (ii) Be served upon the employer by facsimile transmission, in 
person, or by certified or regular mail, at the employer's last known 
address; and
    (iii) Be accompanied by copies of the complaint, the request for a 
cease and desist order, the evidence submitted by the complainant, and 
any evidence from other investigation(s) of the same or a closely 
related matter which the Administrator may incorporate into the record. 
(Any such evidence from other investigation(s) shall also be made 
available for examination by the complaining party at the Wage and Hour 
Division office which issued the notice.)
    (4) No particular form is prescribed for the employer's response to 
the complaining party's request for a cease and desist order under this 
paragraph (b). However, any such response shall:
    (i) Be dated;
    (ii) Be submitted by facsimile transmission, in person, by certified 
or regular mail, or by courier service to the Wage and Hour Division 
office which issued the notice of the request;
    (iii) Be received by the appropriate Wage and Hour Division office 
no later than 14 calendar days from the date of the notice of the 
request;
    (iv) Be typewritten or legibly written;
    (v) Explain, in any detail desired by the employer, the employer's 
grounds or reasons as to why the Administrator should deny the requested 
cease and desist order;
    (vi) Be accompanied by evidence to substantiate the employer's 
grounds or reasons as to why the Administrator should deny the requested 
cease and desist order;
    (vii) Specify whether the employer desires an informal meeting with 
a Wage and Hour Division official;
    (viii) Be signed by the employer or its authorized representative; 
and
    (ix) Include the address at which the employer or its authorized 
representative desires to receive further communications relating 
thereto.
    (5) In the event the employer requests a meeting with a Wage and 
Hour Division official, the Administrator shall provide the employer and 
the complaining party, or their authorized representatives, an 
opportunity for such a meeting to present their views regarding the 
evidence and arguments submitted by the parties. This shall be an 
informal meeting, not subject to any procedural rules. The meeting shall 
be held within the 14 calendar days permitted for the employer's 
response to the request for the cease and desist order, and shall be 
held at a time and place set by the Wage and Hour Division official, who 
shall notify the parties.
    (6) After receipt of the employer's timely response and after any 
informal meeting which may have been held with the parties, the 
Administrator shall promptly issue a written determination, either 
denying the request or issuing a cease and desist order. If the 
Administrator determines that the complaining party's position is 
supported by a preponderance of the evidence submitted, the 
Administrator shall order that the employer cease the use of alien 
crewmembers to perform the longshore activity(ies) specified in the 
order. In making the determination, the Administrator shall consider all 
the evidence submitted, including any evidence from the same or a 
closely related matter which the Administrator has incorporated into the 
record and provided to the employer. The order shall remain in effect 
until the completion of the investigation and any subsequent hearing 
proceedings pursuant toSec. 655.625 of this part, unless the employer 
files and maintains on file with ETA an attestation pursuant toSec. 
655.520 of this part or unless the prohibition is lifted by subsequent 
order of the Administrator because it is later determined that the 
employer's position was correct.

[[Page 632]]

    (7) The Administrator's cease and desist order shall be served on 
the employer or its designated representative by facsimile transmission, 
personal service, or by certified mail at the address specified in the 
employer's response or, if no such address was specified, at the 
employer's last known address.



Sec.  655.620  Civil money penalties and other remedies.

    (a) The Administrator may assess a civil money penalty not to exceed 
$5,000 for each alien crewmember with respect to whom there has been a 
violation of the attestation or subpart F or G of this part. The 
Administrator may also impose appropriate remedy(ies).
    (b) In determining the amount of civil money penalty to be assessed, 
the Administrator shall consider the type of violation committed and 
other relevant factors. The factors which may be considered include, but 
are not limited to, the following:
    (1) Previous history of violation, or violations, by the employer 
under the Act and subpart F or G of this part;
    (2) The number of workers affected by the violation or violations;
    (3) The gravity of the violation or violations;
    (4) Efforts made by the violator in good faith to comply with the 
provisions of 8 U.S.C. 1288(c) and subparts F and G of this part;
    (5) The violator's explanation of the violation or violations;
    (6) The violator's commitment to future compliance; and/or
    (7) The extent to which the violator achieved a financial gain due 
to the violation, or the potential financial loss, potential injury or 
adverse effect with respect to other parties.
    (c) The civil money penalty, and any other remedy determined by the 
Administrator to be appropriate, are immediately due for payment or 
performance upon the assessment by the Administrator, or the decision by 
an administrative law judge where a hearing is requested, or the 
decision by the Secretary where review is granted. The employer shall 
remit the amount of the civil money penalty, by certified check or money 
order made payable to the order of ``Wage and Hour Division, Labor.'' 
The remittance shall be delivered or mailed to the Wage and Hour 
Division office for the area in which the violations occurred. The 
performance of any other remedy prescribed by the Administrator shall 
follow procedures established by the Administrator. The employer's 
failure to pay the civil money penalty, or to perform any other remedy 
prescribed by the Administrator, shall result in the rejection by ETA of 
any future attestation submitted by the employer, until such payment or 
performance is accomplished.



Sec.  655.625  Written notice, service and Federal Register 
publication of Administrator's determination.

    (a) The Administrator's determination, issued pursuant toSec. 
655.605 of this part, shall be served on the complainant, the employer, 
and other known interested parties by personal service or by certified 
mail at the parties' last known addresses. Where service by certified 
mail is not accepted by the party, the Administrator may exercise 
discretion to serve the determination by regular mail.
    (b) Where the Administrator determines the prevailing practice 
regarding the use of alien crewmember(s) to perform longshore 
activity(ies) in a U.S. port (whether the Administrator's investigation 
involves an employer operating under an attestation, or under the 
automated vessel exception), the Administrator shall, simultaneously 
with issuance of the determination, publish in the Federal Register a 
notice of the determination. The notice shall identify the 
activity(ies), the U.S. port, and the prevailing practice regarding the 
use of alien crewmembers. The notice shall also inform interested 
parties that they may request a hearing pursuant toSec. 655.630 of 
this part, within 15 days of the date of the determination.
    (c) The Administrator shall file with the Chief Administrative Law 
Judge, U.S. Department of Labor, a copy of the complaint and the 
Administrator's determination.
    (d) The Administrator's written determination required bySec. 
655.605 of this part shall:

[[Page 633]]

    (1) Set forth the determination of the Administrator and the reason 
or reasons therefor, and in the case of a finding of violation(s) by an 
attesting employer, prescribe any remedies, including the amount of any 
civil money penalties assessed and the reason therefor, and/or any other 
remedies required for compliance with the employer's attestation.
    (2) Inform the interested parties that they may request a hearing 
pursuant toSec. 655.625 of this part.
    (3) Inform the interested parties that in the absence of a timely 
request for a hearing, received by the Chief Administrative Law Judge 
within 15 calendar days of the date of the determination, the 
determination of the Administrator shall become final and not 
appealable.
    (4) Set forth the procedure for requesting a hearing, and give the 
address of the Chief Administrative Law Judge (with whom the request 
must be filed) and the representative(s) of the Solicitor of Labor (upon 
whom copies of the request must be served).
    (5) Inform the parties that, pursuant toSec. 655.665, the 
Administrator shall notify ETA and the DHS of the occurrence of a 
violation by the attesting employer or of the non-attesting employer's 
ineligibility for the automated vessel exception.



Sec.  655.630  Request for hearing.

    (a) Any interested party desiring to request an administrative 
hearing on a determination issued pursuant to Sec.Sec. 655.605 and 
655.625 of this part shall make such request in writing to the Chief 
Administrative Law Judge at the address stated in the notice of 
determination.
    (b) Interested parties may request a hearing in the following 
circumstances:
    (1) The complainant or any other interested party may request a 
hearing where the Administrator determines, after investigation, that 
there is no basis for a finding that an attesting employer has committed 
violation(s) or that the employer is eligible for the automated vessel 
exception. In such a proceeding, the requesting party and the employer 
shall be parties; the Administrator may intervene as a party or appear 
as amicus curiae at any time in the proceeding, at the Administrator's 
discretion.
    (2) The employer or any other interested party may request a hearing 
where the Administrator determines, after investigation, that there is a 
basis for a finding that an attesting employer has committed 
violation(s) or that a non- attesting employer is not eligible for the 
automated vessel exception. In such a proceeding, the Administrator and 
the employer shall be parties.
    (c) No particular form is prescribed for any request for hearing 
permitted by this section. However, any such request shall:
    (1) Be dated;
    (2) Be typewritten or legibly written;
    (3) Specify the issue or issues stated in the notice of 
determination giving rise to such request;
    (4) State the specific reason or reasons why the party requesting 
the hearing believes such determination is in error;
    (5) Be signed by the party making the request or by an authorized 
representative of such party; and
    (6) Include the address at which such party or authorized 
representative desires to receive further communications relating 
thereto.
    (d) The request for such hearing must be received by the Chief 
Administrative Law Judge, at the address stated in the Administrator's 
notice of determination, no later than 15 calendar days after the date 
of the determination. An interested party that fails to meet this 15-day 
deadline for requesting a hearing may thereafter participate in the 
proceedings only by consent of the administrative law judge, either 
through intervention as a party pursuant to 29 CFR 18.10 (b) through (d) 
or through participation as an amicus curiae pursuant to 18 CFR 18.12.
    (e) The request may be filed in person, by facsimile transmission, 
by certified or regular mail, or by courier service. For the requesting 
party's protection, if the request is filed by mail, it should be by 
certified mail. If the request is filed by facsimile transmission, the 
original of the request, signed by the requestor or authorized

[[Page 634]]

representative, shall be filed within ten days.
    (f) Copies of the request for a hearing shall be sent by the 
requestor to the Wage and Hour Division official who issued the 
Administrator's notice of determination, to the representative(s) of the 
Solicitor of Labor identified in the notice of determination, and to all 
known interested parties.



Sec.  655.635  Rules of practice for administrative law judge
proceedings.

    (a) Except as specifically provided in this subpart, and to the 
extent they do not conflict with the provisions of this subpart, the 
``Rules of Practice and Procedure for Administrative Hearings Before the 
Office of Administrative Law Judges'' established by the Secretary at 29 
CFR part 18 shall apply to administrative proceedings under this 
subpart.
    (b) As provided in the Administrative Procedure Act, 5 U.S.C. 556, 
any oral or documentary evidence may be received in proceedings under 
this part. The Federal Rules of Evidence and subpart B of the Rules of 
Practice and Procedure for Administrative Hearings Before the Office of 
Administrative Law Judges (29 CFR part 18, subpart B) shall not apply, 
but principles designed to ensure production of relevant and probative 
evidence shall guide the admission of evidence. The administrative law 
judge may exclude evidence which is immaterial, irrelevant, or unduly 
repetitive.



Sec.  655.640  Service and computation of time.

    (a) Under this subpart, a party may serve any pleading or document 
by regular mail. Service on a party is complete upon mailing to the last 
known address or, in the case of the attesting employer, to the 
employer's designated representative in the U.S. No additional time for 
filing or response is authorized where service is by mail. In the 
interest of expeditious proceedings, the administrative law judge may 
direct the parties to serve pleadings or documents by a method other 
than regular mail.
    (b) Two (2) copies of all pleadings and other documents in any 
administrative law judge proceeding shall be served on the attorneys for 
the Administrator. One copy shall be served on the Associate Solicitor, 
Division of Fair Labor Standards, Office of the Solicitor, U.S. 
Department of Labor, 200 Constitution Avenue NW., Washington, DC 20210, 
and one copy on the attorney representing the Administrator in the 
proceeding.
    (c) Time will be computed beginning with the day following the 
action and includes the last day of the period unless it is a Saturday, 
Sunday, or federally-observed holiday, in which case the time period 
includes the next business day.



Sec.  655.645  Administrative law judge proceedings.

    (a) Upon receipt of a timely request for a hearing filed pursuant to 
and in accordance withSec. 655.630 of this part, the Chief 
Administrative Law Judge shall promptly appoint an administrative law 
judge to hear the case.
    (b) Within seven calendar days following the assignment of the case, 
the administrative law judge shall notify all interested parties of the 
date, time and place of the hearing. All parties shall be given at least 
fourteen calendar days' notice of such hearing.
    (c) The date of the hearing shall be not more than 60 calendar days 
from the date of the Administrator's determination. Because of the time 
constraints imposed by the Act, no requests for postponement shall be 
granted except for compelling reasons. Even if such reasons are shown, 
no extension of the hearing date beyond 60 days from the date of the 
Administrator's determination shall be granted except by consent of all 
the parties to the proceeding.
    (d) The administrative law judge may prescribe a schedule by which 
the parties are permitted to file a prehearing brief or other written 
statement of fact or law. Any such brief or statement shall be served 
upon each other party in accordance withSec. 655.640 of this part. 
Posthearing briefs will not be permitted except at the request of the 
administrative law judge. When permitted, any such brief shall be 
limited to the issue or issues specified by the administrative law 
judge, shall be due within the time prescribed by the administrative law 
judge, and shall be

[[Page 635]]

served on each other party in accordance withSec. 655.640 of this 
part.
    (e) In reaching a decision, the administrative law judge shall, in 
accordance with the Act, impose the following burden of proof--
    (1) The attesting employer shall have the burden of producing facts 
and evidence to establish the matters required by the attestation at 
issue;
    (2) The burden of proof as to the applicability of the automated 
vessel exception shall be on the party to the hearing who is asserting 
that the employer is not eligible for the exception.
    (f) The administrative law judge proceeding shall not be an appeal 
or review of the Administrator's ruling on a request for a cease and 
desist order pursuant toSec. 655.615.



Sec.  655.650  Decision and order of administrative law judge.

    (a) Within 90 calendar days after receipt of the transcript of the 
hearing, the administrative law judge shall issue a decision. If any 
party desires review of the decision, including judicial review, a 
petition for Secretary's review thereof shall be filed as provided in 
Sec.  655.655 of this subpart. If a petition for review is filed, the 
decision of the administrative law judge shall be inoperative unless and 
until the Secretary issues an order affirming the decision, or, unless 
and until 30 calendar days have passed after the Secretary's receipt of 
the petition for review and the Secretary has not issued notice to the 
parties that the Secretary will review the administrative law judge's 
decision.
    (b) The decision of the administrative law judge shall include a 
statement of findings and conclusions, with reasons and basis therefor, 
upon each material issue presented on the record. The decision shall 
also include an appropriate order which may affirm, deny, reverse, or 
modify, in whole or in part, the determination of the Administrator; the 
reason or reasons for such order shall be stated in the decision. The 
administrative law judge shall not render determinations as to the 
legality of a regulatory provision or the constitutionality of a 
statutory provision.
    (c) The decision shall be served on all parties in person or by 
certified or regular mail.



Sec.  655.655  Secretary's review of administrative law judge's 
decision.

    (a) The Administrator or any interested party desiring review of the 
decision and order of an administrative law judge shall petition the 
Secretary to review the decision and order. To be effective, such 
petition shall be received by the Secretary within 30 calendar days of 
the date of the decision and order. Copies of the petition shall be 
served on all parties and on the administrative law judge.
    (b) No particular form is prescribed for any petition for 
Secretary's review permitted by this subpart. However, any such petition 
shall:
    (1) Be dated;
    (2) Be typewritten or legibly written;
    (3) Specify the issue or issues stated in the administrative law 
judge decision and order giving rise to such petition;
    (4) State the specific reason or reasons why the party petitioning 
for review believes such decision and order are in error;
    (5) Be signed by the party filing the petition or by an authorized 
representative of such party;
    (6) Include the address at which such party or authorized 
representative desires to receive further communications relating 
thereto; and
    (7) Attach copies of the administrative law judge's decision and 
order, and any other record documents which would assist the Secretary 
in determining whether review is warranted.
    (c) Whenever the Secretary determines to review the decision and 
order of an administrative law judge, a notice of the Secretary's 
determination shall be served upon the administrative law judge and upon 
all parties to the proceeding within 30 calendar days after the 
Secretary's receipt of the petition for review.
    (d) Upon receipt of the Secretary's notice, the Office of 
Administrative Law Judges shall within fifteen calendar days forward the 
complete hearing record to the Secretary.
    (e) The Secretary's notice may specify:

[[Page 636]]

    (1) The issue or issues to be reviewed;
    (2) The form in which submissions shall be made by the parties 
(e.g., briefs); and
    (3) The time within which such submissions shall be made.
    (f) All documents submitted to the Secretary shall be filed with the 
Secretary of Labor, U.S. Department of Labor, Washington, DC 20210, 
Attention: Executive Director, Office of Administrative Appeals, room S-
4309. An original and two copies of all documents shall be filed. 
Documents are not deemed filed with the Secretary until actually 
received by the Secretary. All documents, including documents filed by 
mail, shall be received by the Secretary either on or before the due 
date.
    (g) Copies of all documents filed with the Secretary shall be served 
upon all other parties involved in the proceeding. Service upon the 
Administrator shall be in accordance withSec. 655.640(b) of this part.
    (h) The Secretary's final decision shall be issued within 180 
calendar days from the date of the notice of intent to review. The 
Secretary's decision shall be served upon all parties and the 
administrative law judge.
    (i) Upon issuance of the Secretary's decision, the Secretary shall 
transmit the entire record to the Chief Administrative Law Judge for 
custody pursuant toSec. 655.660 of this part.



Sec.  655.660  Administrative record.

    The official record of every completed administrative hearing 
procedure provided by subparts F and G of this part shall be maintained 
and filed under the custody and control of the Chief Administrative Law 
Judge. Upon receipt of a complaint seeking review of the final agency 
action in a United States District Court, the Chief Administrative Law 
Judge shall certify the official record and shall transmit such record 
to the clerk of the court.



Sec.  655.665  Notice to the Department of Homeland Security and the 
Employment and Training Administration.

    (a) The Administrator shall promptly notify the DHS and ETA of the 
entry of a cease and desist order pursuant toSec. 655.615 of this 
part. The order shall remain in effect until the completion of the 
Administrator's investigation and any subsequent proceedings pursuant to 
Sec.  655.630 of this part, unless the Administrator notifies the DHS 
and ETA of the entry of a subsequent order lifting the prohibition.
    (1) The DHS, upon receipt of notification from the Administrator 
that a cease and desist order has been entered against an employer:
    (i) Shall not permit the vessels owned or chartered by the attesting 
employer to use alien crewmembers to perform the longshore activity(ies) 
at the port or location in the State of Alaska specified in the cease 
and desist order; and
    (ii) Shall, in the case of an employer seeking to utilize the 
automated vessel exception, require that such employer not use alien 
crewmembers to perform the longshore activity(ies) at the port or 
location in the State of Alaska specified in the cease and desist order, 
without having on file with ETA an attestation pursuant toSec. 655.520 
of this part.
    (2) ETA, upon receipt of the Administrator's notice shall, in the 
case of an attesting employer, suspend the employer's attestation, 
either in whole or in part, for the activity(ies) and port or location 
in the State of Alaska specified in the cease and desist order.
    (b) The Administrator shall notify the DHS and ETA of the final 
determination of a violation by an attesting employer or of the 
ineligibility of an employer for the automated vessel exception, upon 
the earliest of the following events:
    (1) Where the Administrator determines that there is a basis for a 
finding of violation by an attesting employer or a finding of 
nonapplicability of the automated vessel exception, and no timely 
request for hearing is made pursuant toSec. 655.630 of this part;
    (2) Where, after a hearing, the administrative law judge issues a 
decision and order finding a violation by an attesting employer or 
finding inapplicable the automated vessel exception, and no timely 
petition for review to the Secretary is made pursuant toSec. 655.655 
of this part; or
    (3) Where a petition for review is taken from an administrative law

[[Page 637]]

judge's decision finding a violation or finding inapplicable the 
automated vessel exception, and the Secretary either declines within 
thirty days to entertain the appeal, pursuant toSec. 655.655(c) of 
this part, or the Secretary affirms the administrative law judge's 
determination; or
    (4) Where the administrative law judge finds that there was no 
violation by an attesting employer or that the automated vessel 
exception does apply, and the Secretary, upon review, issues a decision 
pursuant toSec. 655.655 of this part, holding that a violation was 
committed by an attesting employer or holding that the automated vessel 
exception does not apply.
    (c) The DHS, upon receipt of notification from the Administrator 
pursuant to paragraph (b) of this section:
    (1) Shall not permit the vessels owned or chartered by the attesting 
employer to enter any port of the U.S. for a period of up to one year;
    (2) Shall, in the case of an employer determined to be ineligible 
for the automated vessel exception, thereafter require that such 
employer not use alien crewmembers(s) to perform the longshore 
activity(ies) at the specified port or location in the State of Alaska 
without having on file with ETA an attestation pursuant toSec. 655.520 
of this part; and
    (3) Shall, in the event that the Administrator's notice constitutes 
a conclusive determination (pursuant toSec. 655.670) that the 
prevailing practice at a particular U.S. port does not permit the use of 
nonimmigrant alien crewmembers for particular longshore activity(ies), 
thereafter permit no employer to use alien crewmembers for the 
particular longshore activity(ies) at that port.
    (d) ETA, upon receipt of the Administrator's notice pursuant to 
paragraph (b) of this section:
    (1) Shall, in the case of an attesting employer, suspend the 
employer's attestation, either in whole or in part, for the port or 
location at issue and for any other U.S. port, and shall not accept for 
filing any attestation submitted by the employer for a period of 12 
months or for a shorter period if such is specified for that employer by 
the DHS; and
    (2) Shall, if the Administrator's notice constitutes a conclusive 
determination (pursuant toSec. 655.670) that the prevailing practice 
at a particular U.S. port does not permit the use of alien crewmembers 
for the longshore activity(ies), thereafter accept no attestation under 
the prevailing practice exception on Form ETA 9033 from any employer for 
the performance of the activity(ies) at that port, and shall invalidate 
any current attestation under the prevailing practice exception on Form 
ETA 9033 for any employer for the performance of the activity(ies) at 
that port.

[60 FR 3969, 3977, Jan. 19, 1995, as amended at 71 FR 35520, June 21, 
2006]



Sec.  655.670  Federal Register notice of determination of prevailing
practice.

    (a) Pursuant toSec. 655.625(b), the Administrator shall publish in 
the Federal Register a notice of the Administrator's determination of 
any investigation regarding the prevailing practice for the use of alien 
crewmembers for particular longshore activity(ies) in a particular U.S. 
port (whether under an attestation or under the automated vessel 
exception). Where the Administrator has determined that the prevailing 
practice in that U.S. port does not permit such use of alien 
crewmembers, and no timely request for a hearing is filed pursuant to 
Sec.  655.630, the Administrator's determination shall be the conclusive 
determination for purposes of the Act and subparts F and G of this part; 
the DHS and ETA shall, upon notice from the Administrator, take the 
actions specified inSec. 655.665. Where the Administrator has 
determined that the prevailing practice in that U.S. port at the time of 
the investigation permits such use of alien crewmembers, the 
Administrator shall, in any subsequent investigation, give that 
determination appropriate weight, unless the determination is reversed 
in proceedings underSec. 655.630 orSec. 655.655.
    (b) Where an interested party, pursuant toSec. 655.630, requests a 
hearing on the Administrator's determination, the Administrator shall, 
upon the issuance of the decision of the administrative law judge, 
publish in the Federal Register a notice of the judge's decision as to 
the prevailing practice for the

[[Page 638]]

longshore activity(ies) and U.S. port at issue, if the administrative 
law judge:
    (1) Reversed the determination of the Administrator published in the 
Federal Register pursuant to paragraph (a) of this section; or
    (2) Determines that the prevailing practice for the particular 
activity in the port does not permit the use of alien crewmembers.
    (c) If the administrative law judge determines that the prevailing 
practice in that port does not permit such use of alien crewmembers, the 
judge's decision shall be the conclusive determination for purposes of 
the Act and subparts F and G of this part (unless and until reversed by 
the Secretary on discretionary review pursuant toSec. 655.655). The 
DHS and ETA shall upon notice from the Administrator, take the actions 
specified inSec. 655.665.
    (d) In the event that the Secretary, upon discretionary review 
pursuant toSec. 655.655, issues a decision that reverses the 
administrative law judge on a matter on which the Administrator has 
published notices in the Federal Register pursuant to paragraphs (a) and 
(b) of this section, the Administrator shall publish in the Federal 
Register a notice of the Secretary's decision and shall notify the DHS 
and ETA.
    (1) Where the Secretary reverses the administrative law judge and 
determines that, contrary to the judge's decision, the prevailing 
practice for the longshore activity(ies) in the U.S. port at issue does 
not permit the use of alien crewmembers, the Secretary's decision shall 
be the conclusive determination for purposes of the Act and subparts F 
and G of this part. Upon notice from the Administrator, the DHS and ETA 
shall take the actions specified inSec. 655.665.
    (2) Where the Secretary reverses the administrative law judge and 
determines that, contrary to the judge's decision, the use of alien 
crewmembers is permitted by the prevailing practice for the longshore 
activity(ies) in the U.S. port at issue, the judge's decision shall no 
longer have the conclusive effect specified in paragraph (b) of this 
section. Upon notice from the Administrator, the DHS and ETA shall cease 
the actions specified inSec. 655.665.



Sec.  655.675  Non-applicability of the Equal Access to Justice Act.

    A proceeding under subpart G of this part is not subject to the 
Equal Access to Justice Act, as amended, 5 U.S.C. 504. In such a 
proceeding, the administrative law judge shall have no authority to 
award attorney fees and/or other litigation expenses pursuant to the 
provisions of the Equal Access to Justice Act.



 Subpart H_Labor Condition Applications and Requirements for Employers 
 Seeking To Employ Nonimmigrants on H	1b Visas in Specialty Occupations 
and as Fashion Models, and Requirements for Employers Seeking To Employ 
      Nonimmigrants on H	1b1 and E	3 Visas in Specialty Occupations

    Source: 59 FR 65659, 65676, Dec. 20, 1994, unless otherwise noted.



Sec.  655.700  What statutory provisions govern the employment of
H-1B, H-1B1, and E-3 nonimmigrants and how do employers apply for
H-1B, H-1B1, and E-3 visas?

    Under the E-3 visa program, the Immigration and Nationality Act 
(INA), as amended, permits certain nonimmigrant treaty aliens to be 
admitted to the United States solely to perform services in a specialty 
occupation (INA section 101(a)(15)(E)(iii)). Under the H-1B1 visa 
program, the INA permits nonimmigrant professionals in specialty 
occupations from countries with which the United States has entered into 
certain agreements that are identified in section 214(g)(8)(A) of the 
INA to temporarily enter the United States for employment in a specialty 
occupation. Employers seeking to employ nonimmigrant workers in 
specialty occupations under H-1B, H-1B1, or E-3 visas must file a labor 
condition application with the Department of Labor as described inSec. 
655.730(c) and (d). Certain procedures described in this subpart H for 
obtaining a visa and entering the U.S. after the Department of Labor 
attestation process, including procedures

[[Page 639]]

inSec. 655.705, apply only to H-1B nonimmigrants. The procedures for 
receiving an E-3 or H-1B1 visa and entering the U.S. on an E-3 or H-1B1 
visa after the attestation process is certified by the Department of 
Labor are identified in the regulations and procedures of the Department 
of State and the United States Citizenship and Immigration Services 
(USCIS) of the Department of Homeland Security. Consult the Department 
of State (http://www.state.gov/) and USCIS (http://www.uscis.gov/) Web 
sites and regulations for specific instructions regarding the E-3 and H-
1B1 visas.
    (a) Statutory provisions regarding H-1B visas. With respect to 
nonimmigrant workers entering the U.S. on H-1B visas, which are 
available to nonimmigrant aliens in specialty occupations or certain 
fashion models from any country, the INA, as amended, provides as 
follows:
    (1) Establishes an annual ceiling (exclusive of spouses and 
children) on the number of foreign workers who may be issued H-1B 
visas--
    (i) 195,000 in fiscal year 2001;
    (ii) 195,000 in fiscal year 2002;
    (iii) 195,000 in fiscal year 2003; and
    (iv) 65,000 in each succeeding fiscal year;
    (2) Defines the scope of eligible occupations for which 
nonimmigrants may be issued H-1B visas and specifies the qualifications 
that are required for entry as an H-1B nonimmigrant ;
    (3) Requires an employer seeking to employ H-1B nonimmigrants to 
file a labor condition application (LCA) agreeing to various attestation 
requirements and have it certified by the Department of Labor (DOL) 
before a nonimmigrant may be provided H-1B status by the United States 
Citizenship and Immigration Services of the Department of Homeland 
Security (DHS); and
    (4) Establishes an enforcement system under which DOL is authorized 
to determine whether an employer has engaged in misrepresentation or 
failed to meet a condition of the LCA, and is authorized to impose fines 
and penalties.
    (b) Procedure for obtaining an H-1B visa classification. Before a 
nonimmigrant may be admitted to work in a ``specialty occupation'' or as 
a fashion model of distinguished merit and ability in the United States 
under the H-1B visa classification, there are certain steps which must 
be followed:
    (1) First, an employer shall submit to the Department of Labor 
(DOL), and obtain DOL certification of, a labor condition application 
(LCA). The requirements for obtaining a certified LCA are provided in 
this subpart. The electronic LCA (Form ETA 9035E) is available at http:/
/www.lca.doleta.gov. The paper-version LCA (Form ETA 9035) and the LCA 
cover pages (Form ETA 9035CP), which contain the full attestation 
statements incorporated by reference into Form ETA 9035 and Form ETA 
9035E, may be obtained from http://ows.doleta.gov and from the 
Employment and Training Administration (ETA) National Office. Employers 
must file LCAs in the manner prescribed inSec. 655.720.
    (2) After obtaining DOL certification of an LCA, the employer may 
submit a nonimmigrant visa petition (DHS Form I-129), together with the 
certified LCA, to DHS, requesting H-1B classification for the foreign 
worker. The requirements concerning the submission of a petition to, and 
its processing by, DHS are set forth in DHS regulations. The DHS 
petition (Form I-129) may be obtained from an DHS district or area 
office.
    (3) If DHS approves the H-1B classification, the nonimmigrant then 
may apply for an H-1B visa abroad at a consular office of the Department 
of State. If the nonimmigrant is already in the United States in a 
status other than H-1B, he/she may apply to the DHS for a change of visa 
status.
    (c) Applicability. (1) This subpart H and subpart I of this part 
apply to all employers seeking to employ foreign workers under the H-1B 
visa classification in specialty occupations or as fashion models of 
distinguished merit and ability.
    (2) During the period that the provisions of Appendix 1603.D.4 of 
Annex 1603 of the North American Free Trade Agreement (NAFTA) apply, 
this subpart H and subpart I of this part shall apply (except for the 
provisions relating to the recruitment and displacement of U.S. workers 
(see Sec.Sec. 655.738 and 655.739)) to the entry and employment

[[Page 640]]

of a nonimmigrant who is a citizen of Mexico under and pursuant to the 
provisions of section D or Annex 1603 of NAFTA in the case of all 
professions set out in Appendix 1603.D.1 of Annex 1603 of NAFTA other 
than registered nurses. Therefore, the references in this part to ``H-1B 
nonimmigrant'' apply to any Mexican citizen nonimmigrant who is 
classified by DHS as ``TN.'' In the case of a registered nurse, the 
following provisions shall apply: subparts D and E of this part or the 
Nursing Relief for Disadvantaged Areas Act of 1999 (Public Law 106-95) 
and the regulations issued thereunder, 20 CFR part 655, subparts L and 
M.
    (3) E-3 visas: Except as provided in paragraph (d) of this section, 
this subpart H and subpart I of this part apply to all employers seeking 
to employ foreign workers under the E-3 visa classification in specialty 
occupations under INA section 101(a)(15)(E)(iii) (8 U.S.C. 
1101(a)(15)(E)(iii)). This paragraph (c)(3) applies to labor condition 
applications filed on or after April 11, 2008. E-3 labor condition 
applications filed prior to that date but on or after May 11, 2005 
(i.e., the effective date of the statute), will be processed according 
to the E-3 statutory terms and the E-3 processing procedures published 
on July 19, 2005 in the Federal Register at 74 FR 41434.
    (4) H-1B1 visas: Except as provided in paragraph (d) of this 
section, subparts H and I of this part apply to all employers seeking to 
employ foreign workers under the H-1B1 visa classification in specialty 
occupations described in INA section 101(a)(15)(H)(i)(b1) (8 U.S.C. 
1101(a)(15)(H)(i)(b1)), under the U.S.-Chile and U.S.-Singapore Free 
Trade Agreements as long as the Agreements are in effect. (INA section 
214(g)(8)(A) (8 U.S.C. 1184(g)(8)(A)). This paragraph (c)(4) applies to 
H-1B1 labor condition applications filed on or after November 23, 2004. 
Further, H-1B1 labor condition applications filed prior to that date but 
on or after January 1, 2004, the effective date of the H-1B1 program, 
will be handled according to the H-1B1 statutory terms and the H-1B1 
processing procedures as described in paragraph (d)(3) of this section.
    (d) Nonimmigrants on E-3 or H-1B1 visas--(1) Exclusions. The 
following sections in this subpart and in subpart I of this part do not 
apply to E-3 and H-1B1 nonimmigrants, but apply only to H-1B 
nonimmigrants: Sec.Sec. 655.700(a), (b), (c)(1) and (2); 655.710(b); 
655.730(d)(5) and (e); 655.735; 655.736; 655.737; 655.738; 655.739; 
655.760(a)(7), (8), (9), and (10); and 655.805(a)(7), (8), and (9). 
Further, the following references in subparts H or I of this part, 
whether in the excluded sections listed above or elsewhere, do not apply 
to E-3 and H-1B1 nonimmigrants, but apply only to H-1B nonimmigrants: 
references to fashion models of distinguished merit and ability (H-1B 
visas, but not H-1B1 and E-3 visas, are available to such fashion 
models); references to a petition process before USCIS (the petition 
process applies only to H-1B, but not to initial H-1B1 and E-3 visas 
unless it is a petition to accord a change of status); references to 
additional attestation obligations of H-1B-dependent employers and 
employers found to have willfully violated the H-1B program requirements 
(these provisions do not apply to the H-1B1 and E-3 programs); and 
references inSec. 655.750(a) or elsewhere in this part to the 
provision in INA section 214(n) (formerly INA section 214(m)) (8 U.S.C. 
1184(n)) regarding increased portability of H-1B status (by the 
statutory terms, the portability provision is inapplicable to H-1B1 and 
E-3 nonimmigrants).
    (2) Terminology. For purposes of subparts H and I of this part, 
except in those sections identified in paragraph (d)(1) of this section 
as inapplicable to E-3 and H-1B1 nonimmigrants and as otherwise 
excluded:
    (i) The term ``H-1B'' includes ``E-3'' and ``H-1B1'' (INA section 
101(a)(15)(E)(iii) and (a)(15)(H)(i)(b1)) (8 U.S.C. 1101(a)(15)(E)(iii) 
and (a)(15)(H)(i)(b1)); and
    (ii) The term ``labor condition application'' or ``LCA'' includes a 
labor attestation made under section 212(t)(1) of the INA for an E-3 or 
H-1B1 nonimmigrant professional classified under INA section 
101(a)(15)(E)(iii) and (a)(15)(H)(i)(b1) (8 U.S.C. 1101(a)(15)(E)(iii) 
and (a)(15)(H)(i)(b1)).
    (3) Filing procedures for E-3 and H-1B1 labor attestations. 
Employers seeking to employ an E-3 or H-1B1 nonimmigrant must submit a 
completed ETA Form

[[Page 641]]

9035 or ETA Form 9035E (electronic) to DOL in the manner prescribed in 
Sec.Sec. 655.720 and 655.730. Employers must indicate on the form 
whether the labor condition application is for an ``E-3 Australia,'' 
``H-1B1 Chile,'' or ``H-1B1 Singapore'' nonimmigrant. Any changes in the 
procedures and instructions for submitting labor condition applications 
will be provided in a notice published in the Federal Register and 
posted on the ETA Web site at http://www.foreignlaborcert.doleta.gov/.
    (4) Employer's responsibilities regarding E-3 and H-1B1 labor 
attestation. Each employer seeking an E-3 or H-1B1 nonimmigrant in a 
specialty occupation has several responsibilities, as described more 
fully in subparts H and I of this part, including the following:
    (i) By submitting a signed and completed LCA, the employer makes 
certain representations and agrees to several attestations regarding the 
employer's responsibilities, including the wages, working conditions, 
and benefits to be provided to the E-3 or H-1B1 nonimmigrant. These 
attestations are specifically identified and incorporated in the LCA, 
and are fully described on Form ETA 9035CP (cover pages).
    (ii) The employer reaffirms its acceptance of all of the attestation 
obligations by transmitting the certified labor attestation to the 
nonimmigrant, the Department of State, and/or the USCIS according to the 
procedures of those agencies.
    (iii) The employer shall maintain the original signed and certified 
LCA in its files, and shall make a copy of the filed LCA, as well as 
necessary supporting documentation (as identified under this subpart), 
available for public examination in a public access file at the 
employer's principal place of business in the U.S. or at the place of 
employment within one working day after the date on which the LCA is 
filed with ETA.
    (iv) The employer shall develop sufficient documentation to meet its 
burden of proof, in the event that such statement or information is 
challenged, with respect to the validity of the statements made in its 
LCA and the accuracy of information provided. The employer shall also 
maintain such documentation at its principal place of business in the 
U.S. and shall make such documentation available to DOL for inspection 
and copying upon request.
    (5) Application to Chile. During the period that the provisions of 
Chapter 14 and Section D of Annex 14.3 of the United States-Chile Free 
Trade Agreement (Chile FTA) are in effect, this subpart H and subpart I 
of this part shall apply (except for the provisions excluded under 
paragraph (d)(1) of this section) to the temporary entry and employment 
of a nonimmigrant who is a national of Chile under the provisions of 
Article 14.9 and Annex 2.1 of the Chile FTA and who is a professional 
under the provisions of Annex 14.3(D) of the Chile FTA.
    (6) Application to Singapore. During the period that the provisions 
of Section IV of Annex 11A of the United States-Singapore Free Trade 
Agreement (Singapore FTA) are in effect, this subpart H and subpart I of 
this part shall apply (except for the provisions excluded under 
paragraph (d)(1) of this section) to the temporary entry and employment 
of a nonimmigrant who is a national of Singapore under the provisions of 
Chapter 11 and Section IV of Annex 11A of the Singapore FTA and who is a 
professional under the provisions of Annex 11A(IV) of the Singapore FTA.

[65 FR 80209, Dec. 20, 2000, as amended at 66 FR 63300, Dec. 5, 2001; 69 
FR 68226, Nov. 23, 2004; 70 FR 72560, Dec. 5, 2005; 71 FR 35520, 35521, 
June 21, 2006; 71 FR 37804, June 30, 2006; 73 FR 19947, Apr. 11, 2008]



Sec.  655.705  What Federal agencies are involved in the H-1B and 
H-1B1 programs, and what are the responsibilities of those agencies 
and of employers?

    Four federal agencies (Department of Labor, Department of State, 
Department of Justice, and Department of Homeland Security) are involved 
in the process relating to H-1B nonimmigrant classification and 
employment. The employer also has continuing responsibilities under the 
process. This section briefly describes the responsibilities of each of 
these entities.
    (a) Department of Labor (DOL) responsibilities. DOL administers the 
labor

[[Page 642]]

condition application process and enforcement provisions (exclusive of 
complaints regarding non-selection of U.S. workers, as described in 8 
U.S.C. 1182(n)(1)(G)(i)(II) and 1182(n)(5)). Two DOL agencies have 
responsibilities:
    (1) The Employment and Training Administration (ETA) is responsible 
for receiving and certifying labor condition applications (LCAs) in 
accordance with this subpart H. ETA is also responsible for compiling 
and maintaining a list of LCAs and makes such list available for public 
examination at the Department of Labor, 200 Constitution Avenue, NW., 
Room C-4312, Washington, DC 20210.
    (2) The Wage and Hour Division of the Employment Standards 
Administration (ESA) is responsible, in accordance with subpart I of 
this part, for investigating and determining an employer's 
misrepresentation in or failure to comply with LCAs in the employment of 
H-1B nonimmigrants.
    (b) Department of Justice (DOJ), Department of Homeland Security 
(DHS) and Department of State (DOS) responsibilities. The Department of 
State, through U.S. Embassies and Consulates, is responsible for issuing 
H-1B, H-1B1, and E-3 visas. For H-1B visas, the following agencies are 
involved: DHS accepts the employer's petition (DHS Form I-129) with the 
DOL-certified LCA attached. In doing so, the DHS determines whether the 
petition is supported by an LCA which corresponds with the petition, 
whether the occupation named in the labor condition application is a 
specialty occupation or whether the individual is a fashion model of 
distinguished merit and ability, and whether the qualifications of the 
nonimmigrant meet the statutory requirements for H-1B visa 
classification. If the petition is approved, DHS will notify the U.S. 
Consulate where the nonimmigrant intends to apply for the visa unless 
the nonimmigrant is in the U.S. and eligible to adjust status without 
leaving this country. See 8 U.S.C. 1255(h)(2)(B)(i). The Department of 
Justice administers the system for the enforcement and disposition of 
complaints regarding an H-1B-dependent employer's or willful violator 
employer's failure to offer a position filled by an H-1B nonimmigrant to 
an equally or better qualified United States worker (8 U.S.C. 
1182(n)(1)(E), 1182(n)(5)), or such employer's willful misrepresentation 
of material facts relating to this obligation. DHS, is responsible for 
disapproving H-1B and other petitions filed by an employer found to have 
engaged in misrepresentation or failed to meet certain conditions of the 
labor condition application (8 U.S.C. 1182(n)(2)(C)(i)-(iii); 
1182(n)(5)(E)). DOL and DOS are involved in the process relating to the 
initial issuance of H-1B1 and E-3 visas. DHS is involved in change of 
status and extension of stays for the H-1B1 and E-3 category.
    (c) Employer's responsibilities. This paragraph applies only to the 
H-1B program; employer's responsibilities under the H-1B1 and E-3 
programs are found atSec. 655.700(d)(4). Each employer seeking an H-1B 
nonimmigrant in a specialty occupation or as a fashion model of 
distinguished merit and ability has several responsibilities, as 
described more fully in this subpart and subpart I of this part, 
including:
    (1) The employer shall submit a completed labor condition 
application (LCA) on Form ETA 9035E or Form ETA 9035 in the manner 
prescribed inSec. 655.720. By completing and submitting the LCA, and 
by signing the LCA, the employer makes certain representations and 
agrees to several attestations regarding its responsibilities, including 
the wages, working conditions, and benefits to be provided to the H-1B 
nonimmigrants (8 U.S.C. 1182(n)(1)); these attestations are specifically 
identified and incorporated by reference in the LCA, as well as being 
set forth in full on Form ETA 9035CP. The LCA contains additional 
attestations for certain H-1B-dependent employers and employers found to 
have willfully violated the H-1B program requirements; these 
attestations impose certain obligations to recruit U.S. workers, to 
offer the job to U.S. applicants who are equally or better qualified 
than the H-1B nonimmigrant(s) sought for the job, and to avoid the 
displacement of U.S. workers (either in the employer's workforce, or in 
the workforce of a second employer with whom the H-1B nonimmigrant(s) is 
placed, where there

[[Page 643]]

are indicia of employment with a second employer (8 U.S.C. 
1182(n)(1)(E)-(G)). These additional attestations are specifically 
identified and incorporated by reference in the LCA, as well as being 
set forth in full on Form ETA 9035CP. If ETA certifies the LCA, notice 
of the certification will be sent to the employer by the same means the 
employer used to submit the LCA (that is, electronically where the Form 
ETA 9035E was submitted electronically, and by U.S. Mail where the Form 
ETA 9035 was submitted by U.S. Mail). The employer reaffirms its 
acceptance of all of the attestation obligations by submitting the LCA 
to the U.S. Citizenship and Immigration Services (formerly the 
Immigration and Naturalization Service or INS) in support of the 
Petition for Nonimmigrant Worker, Form I-129, for an H-1B nonimmigrant. 
See 8 CFR 214.2(h)(4)(iii)(B)(2), which specifies the employer will 
comply with the terms of the LCA for the duration of the H-1B 
nonimmigrant's authorized period of stay.
    (2) The employer shall maintain the original signed and certified 
LCA in its files, and shall make a copy of the LCA, as well as necessary 
supporting documentation (as identified under this subpart), available 
for public examination in a public access file at the employer's 
principal place of business in the U.S. or at the place of employment 
within one working day after the date on which the LCA is filed with 
ETA.
    (3) The employer then may submit a copy of the certified, signed LCA 
to DHS with a completed petition (Form I-129) requesting H-1B 
classification.
    (4) The employer shall not allow the nonimmigrant worker to begin 
work until DHS grants the alien authorization to work in the United 
States for that employer or, in the case of a nonimmigrant previously 
afforded H-1B status who is undertaking employment with a new H-1B 
employer, until the new employer files a nonfrivolous petition (Form I-
129) in accordance with DHS requirements.
    (5) The employer shall develop sufficient documentation to meet its 
burden of proof with respect to the validity of the statements made in 
its LCA and the accuracy of information provided, in the event that such 
statement or information is challenged. The employer shall also maintain 
such documentation at its principal place of business in the U.S. and 
shall make such documentation available to DOL for inspection and 
copying upon request.

[65 FR 80210, Dec. 20, 2000, as amended at 66 FR 63300, Dec. 5, 2001; 70 
FR 72560, Dec. 5, 2005; 71 FR 35520, June 21, 2006; 73 FR 19948, Apr. 
11, 2008]



Sec.  655.710  What is the procedure for filing a complaint?

    (a) Except as provided in paragraph (b) of this section, complaints 
concerning misrepresentation in the labor condition application or 
failure of the employer to meet a condition specified in the application 
shall be filed with the Administrator, Wage and Hour Division 
(Administrator), ESA, according to the procedures set forth in subpart I 
of this part. The Administrator shall investigate where appropriate, and 
after an opportunity for a hearing, assess appropriate sanctions and 
penalties, as described in subpart I of this part.
    (b) Complaints arising under section 212(n)(1)(G)(i)(II) of the INA, 
8 U.S.C. 1182(n)(1)(G)(i)(II), alleging failure of the employer to offer 
employment to an equally or better qualified U.S. applicant, or an 
employer's misrepresentation regarding such offer(s) of employment, may 
be filed with the Department of Justice, Civil Rights Division, Office 
of Special Counsel for Immigration-Related Unfair Employment Practices, 
950 Pennsylvania Avenue, NW., Washington, DC 20530, Telephone: 1-800-
255-8155 (employers), 1-800-255-7688 (employees); Web address: http://
www.usdoj.gov/crt/osc. The Department of Justice shall investigate where 
appropriate, and take action as appropriate under that Department's 
regulations and procedures.

[65 FR 80210, Dec. 20, 2000, as amended at 70 FR 72561, Dec. 5, 2005]



Sec.  655.715  Definitions.

    For the purposes of subparts H and I of this part:
    Actual wage means the wage rate paid by the employer to all 
individuals with experience and qualifications similar to the H-1B 
nonimmigant's experience

[[Page 644]]

and qualifications for the specific employment in question at the place 
of employment. The actual wage established by the employer is not an 
average of the wage rates paid to all workers employed in the 
occupation.
    Administrative Law Judge (ALJ) means an official appointed pursuant 
to 5 U.S.C. 3105.
    Administrator means the Administrator of the Wage and Hour Division, 
Employment Standards Administration, Department of Labor, and such 
authorized representatives as may be designated to perform any of the 
functions of the Administrator under subpart H or I of this part.
    Aggrieved party means a person or entity whose operations or 
interests are adversely affected by the employer's alleged non-
compliance with the labor condition application and includes, but is not 
limited to:
    (1) A worker whose job, wages, or working conditions are adversely 
affected by the employer's alleged non-compliance with the labor 
condition application;
    (2) A bargaining representative for workers whose jobs, wages, or 
working conditions are adversely affected by the employer's alleged non-
compliance with the labor condition application;
    (3) A competitor adversely affected by the employer's alleged non-
compliance with the labor condition application; and
    (4) A government agency which has a program that is impacted by the 
employer's alleged non-compliance with the labor condition application.
    Area of intended employment means the area within normal commuting 
distance of the place (address) of employment where the H-1B 
nonimmigrant is or will be employed. There is no rigid measure of 
distance which constitutes a normal commuting distance or normal 
commuting area, because there may be widely varying factual 
circumstances among different areas (e.g., normal commuting distances 
might be 20, 30, or 50 miles). If the place of employment is within a 
Metropolitan Statistical Area (MSA) or a Primary Metropolitan 
Statistical Area (PMSA), any place within the MSA or PMSA is deemed to 
be within normal commuting distance of the place of employment; however, 
all locations within a Consolidated Metropolitan Statistical Area (CMSA) 
will not automatically be deemed to be within normal commuting distance. 
The borders of MSAs and PMSAs are not controlling with regard to the 
identification of the normal commuting area; a location outside of an 
MSA or PMSA (or a CMSA) may be within normal commuting distance of a 
location that is inside (e.g., near the border of) the MSA or PMSA (or 
CMSA).
    Attorney General means the chief official of the U.S. Department of 
Justice or the Attorney General's designee.
    Authorized agent and authorized representative mean an official of 
the employer who has the legal authority to commit the employer to the 
statements in the labor condition application.
    Center Director means the Department official to whom the 
Administrator has delegated his authority for purposes of NPC operations 
and functions.
    Certification means the determination by a certifying officer that a 
labor condition application is not incomplete and does not contain 
obvious inaccuracies.
    Certify means the act of making a certification.
    Certifying Officer means a Department of Labor official, or such 
official's designee, who makes determinations about whether or not to 
certify labor condition applications.
    Chief Administrative Law Judge (Chief ALJ) means the chief official 
of the Office of the Administrative Law Judges of the Department of 
Labor or the Chief Administrative Law Judge's designee.
    Department and DOL mean the United States Department of Labor.
    Department of Homeland Security (DHS) through the United States 
Citizenship and Immigration Services (USCIS) makes the determination 
under the INA on whether to grant visa petitions of employers seeking 
the admission of non-immigrants under H-1B visa for the purpose of 
employment.
    Division means the Wage and Hour Division of the Employment 
Standards Administration, DOL.

[[Page 645]]

    Employed, employed by the employer, or employment relationship means 
the employment relationship as determined under the common law, under 
which the key determinant is the putative employer's right to control 
the means and manner in which the work is performed. Under the common 
law, ``no shorthand formula or magic phrase * * * can be applied to find 
the answer * * *. [A]ll of the incidents of the relationship must be 
assessed and weighed with no one factor being decisive.'' NLRB v. United 
Ins. Co. of America, 390 U.S. 254, 258 (1968).
    Employer means a person, firm, corporation, contractor, or other 
association or organization in the United States that has an employment 
relationship with H-1B, H-1B1, or E-3 nonimmigrants and/or U.S. 
worker(s). In the case of an H-1B nonimmigrant (not including E-3 and H-
1B1 nonimmigrants), the person, firm, contractor, or other association 
or organization in the United States that files a petition with the 
United States Citizenship and Immigration Services (USCIS) of the 
Department of Homeland Security (DHS) on behalf of the nonimmigrant is 
deemed to be the employer of that nonimmigrant. In the case of an E-3 
and H-1B1 nonimmigrant, the person, firm, contractor, or other 
association or organization in the United States that files an LCA with 
the Department of Labor on behalf of the nonimmigrant is deemed to be 
the employer of that nonimmigrant.
    Employment and Training Administration (ETA) means the agency within 
the Department which includes the Office of Foreign Labor Certification 
(OFLC).
    Employment Standards Administration (ESA) means the agency within 
the Department which includes the Wage and Hour Division.
    INA means the Immigration and Nationality Act, as amended, 8 U.S.C. 
1101 et seq.
    Independent authoritative source means a professional, business, 
trade, educational or governmental association, organization, or other 
similar entity, not owned or controlled by the employer, which has 
recognized expertise in an occupational field.
    Independent authoritative source survey means a survey of wages 
conducted by an independent authoritative source and published in a 
book, newspaper, periodical, loose-leaf service, newsletter, or other 
similar medium, within the 24-month period immediately preceding the 
filing of the employer's application. Such survey shall:
    (1) Reflect the average wage paid to workers similarly employed in 
the area of intended employment;
    (2) Be based upon recently collected data--e.g., within the 24-month 
period immediately preceding the date of publication of the survey; and
    (3) Represent the latest published prevailing wage finding by the 
authoritative source for the occupation in the area of intended 
employment.
    Interested party means a person or entity who or which may be 
affected by the actions of an H-1B employer or by the outcome of a 
particular investigation and includes any person, organization, or 
entity who or which has notified the Department of his/her/its interest 
or concern in the Administrator's determination.
    Lockout means a labor dispute involving a work stoppage, wherein an 
employer withholds work from its employees in order to gain a concession 
from them.
    Occupation means the occupational or job classification in which the 
H-1B nonimmigrant is to be employed.
    Office of Foreign Labor Certification (OFLC) means the 
organizational component within the ETA that provides national 
leadership and policy guidance and develops regulations and procedures 
to carry out the responsibilities of the Secretary of Labor under the 
INA concerning alien workers seeking admission to the United States in 
order to work under the Immigration and Nationality Act, as amended.
    Period of intended employment means the time period between the 
starting and ending dates inclusive of the H-1B nonimmigrant's intended 
period of employment in the occupational classification at the place of 
employment as set forth in the labor condition application.
    Place of employment means the worksite or physical location where 
the

[[Page 646]]

work actually is performed by the H-1B, H-1B1, or E-3 nonimmigrant.
    (1) The term does not include any location where either of the 
following criteria--paragraph (1)(i) or (ii)--is satisfied:
    (i) Employee developmental activity. An H-1B worker who is stationed 
and regularly works at one location may temporarily be at another 
location for a particular individual or employer-required developmental 
activity such as a management conference, a staff seminar, or a formal 
training course (other than ``on-the-job-training'' at a location where 
the employee is stationed and regularly works). For the H-1B worker 
participating in such activities, the location of the activity would not 
be considered a ``place of employment'' or ``worksite,'' and that 
worker's presence at such location--whether owned or controlled by the 
employer or by a third party--would not invoke H-1B program requirements 
with regard to that employee at that location. However, if the employer 
uses H-1B nonimmigrants as instructors or resource or support staff who 
continuously or regularly perform their duties at such locations, the 
locations would be ``places of employment'' or ``worksites'' for any 
such employees and, thus, would be subject to H-1B program requirements 
with regard to those employees.
    (ii) Particular worker's job functions. The nature and duration of 
an H-1B nonimmigrant's job functions may necessitate frequent changes of 
location with little time spent at any one location. For such a worker, 
a location would not be considered a ``place of employment'' or 
``worksite'' if the following three requirements (i.e., paragraphs 
(1)(ii)(A) through (C)) are all met--
    (A) The nature and duration of the H-1B worker's job functions 
mandates his/her short-time presence at the location. For this purpose, 
either:
    (1) The H-1B nonimmigrant's job must be peripatetic in nature, in 
that the normal duties of the worker's occupation (rather than the 
nature of the employer's business) requires frequent travel (local or 
non-local) from location to location; or
    (2) The H-1B worker's duties must require that he/she spend most 
work time at one location but occasionally travel for short periods to 
work at other locations; and
    (B) The H-1B worker's presence at the locations to which he/she 
travels from the ``home'' worksite is on a casual, short-term basis, 
which can be recurring but not excessive (i.e., not exceeding five 
consecutive workdays for any one visit by a peripatetic worker, or 10 
consecutive workdays for any one visit by a worker who spends most work 
time at one location and travels occasionally to other locations); and
    (C) The H-1B nonimmigrant is not at the location as a 
``strikebreaker'' (i.e., the H-1B nonimmigrant is not performing work in 
an occupation in which workers are on strike or lockout).
    (2) Examples of ``non-worksite'' locations based on worker's job 
functions: A computer engineer sent out to customer locations to 
``troubleshoot'' complaints regarding software malfunctions; a sales 
representative making calls on prospective customers or established 
customers within a ``home office'' sales territory; a manager monitoring 
the performance of out-stationed employees; an auditor providing advice 
or conducting reviews at customer facilities; a physical therapist 
providing services to patients in their homes within an area of 
employment; an individual making a court appearance; an individual 
lunching with a customer representative at a restaurant; or an 
individual conducting research at a library.
    (3) Examples of ``worksite'' locations based on worker's job 
functions: A computer engineer who works on projects or accounts at 
different locations for weeks or months at a time; a sales 
representative assigned on a continuing basis in an area away from his/
her ``home office;'' an auditor who works for extended periods at the 
customer's offices; a physical therapist who ``fills in'' for full-time 
employees of health care facilities for extended periods; or a physical 
therapist who works for a contractor whose business is to provide 
staffing on an ``as needed'' basis at hospitals, nursing homes, or 
clinics.

[[Page 647]]

    (4) Whenever an H-1B worker performs work at a location which is not 
a ``worksite'' (under the criterion in paragraph (1)(i) or (1)(ii) of 
this definition), that worker's ``place of employment'' or ``worksite'' 
for purposes of H-1B obligations is the worker's home station or regular 
work location. The employer's obligations regarding notice, prevailing 
wage and working conditions are focused on the home station ``place of 
employment'' rather than on the above-described location(s) which do not 
constitute worksite(s) for these purposes. However, whether or not a 
location is considered to be a ``worksite''/''place of employment'' for 
an H-1B nonimmigrant, the employer is required to provide reimbursement 
to the H-1B nonimmigrant for expenses incurred in traveling to that 
location on the employer's business, since such expenses are considered 
to be ordinary business expenses of employers (Sec.Sec. 
655.731(c)(7)(iii)(C); 655.731(c)(9)). In determining the worker's 
``place of employment'' or ``worksite,'' the Department will look 
carefully at situations which appear to be contrived or abusive; the 
Department would seriously question any situation where the H-1B 
nonimmigrant's purported ``place of employment'' is a location other 
than where the worker spends most of his/her work time, or where the 
purported ``area of employment'' does not include the location(s) where 
the worker spends most of his/her work time.
    Required wage rate means the rate of pay which is the higher of:
    (1) The actual wage for the specific employment in question; or
    (2) The prevailing wage rate (determined as of the time of filing 
the LCA application) for the occupation in which the H-1B, H-1B1, or E-3 
nonimmigrant is to be employed in the geographic area of intended 
employment. The prevailing wage rate must be no less than the minimum 
wage required by Federal, State, or local law.
    Secretary means the Secretary of Labor or the Secretary's designee.
    Specialty occupation:
    (1) For purposes of the E-3 and H-1B programs (but not the H-1B1 
program), specialty occupation means an occupation that requires 
theoretical and practical application of a body of specialized 
knowledge, and attainment of a bachelor's or higher degree (or its 
equivalent) in the specific specialty as a minimum for entry into the 
occupation in the United States. The nonimmigrant in a specialty 
occupation shall possess the following qualifications:
    (i) Full state licensure to practice in the occupation, if licensure 
is required for the occupation;
    (ii) Completion of the required degree; or
    (iii) Experience in the specialty equivalent to the completion of 
such degree and recognition of expertise in the specialty through 
progressively responsible positions relating to the specialty. INA, 8 
U.S.C. 1184(i)(1) and (2).
    (2) For purposes of the H-1B1 program, specialty occupation means an 
occupation that requires theoretical and practical application of a body 
of specialized knowledge, and attainment of a bachelor's or higher 
degree (or its equivalent) in the specific specialty as a minimum for 
entry into the occupation in the United States. INA, 8 U.S.C. 
1184(i)(3). For H-1B1 nonimmigrants from Chile, additional occupations 
that qualify as specialty occupations are Disaster Relief Claims 
Adjuster, Management Consultant, Agricultural Manager, and Physical 
Therapist, as defined in Appendix 14.3(D)(2) of the United States-Chile 
Free Trade Agreement. For H-1B1 nonimmigrants from Singapore, additional 
occupations that qualify as specialty occupations are Disaster Relief 
Claims Adjuster and Management Consultant, as defined in Appendix 11A.2 
of the United States-Singapore Free Trade Agreement.
    (3) Determinations of specialty occupation and of nonimmigrant 
qualifications for the H-1B and H-1B1 programs are not made by the 
Department of Labor, but by the Department of State and/or United States 
Citizenship and Immigration Services (USCIS) of the Department of 
Homeland Security in accordance with the procedures of those agencies 
for processing visas, petitions, extensions of stay, or requests for 
change of nonimmigrant status for H-1B or H-1B1 nonimmigrants.
    Specific employment in question means the set of duties and 
responsibilities performed or to be performed by the H-

[[Page 648]]

1B nonimmigrant at the place of employment.
    State means one of the 50 States, the District of Columbia, Guam, 
Puerto Rico, and the U.S. Virgin Islands.
    State Workforce Agency, formerly State Employment Security Agency or 
SESA means the State agency which, under the State Administrator, is 
designated by the Governor to administer Wagner-Peyser Act funded 
employment and workforce information services (State agency) and the 
State unemployment compensation program.
    Strike means a labor dispute wherein employees engage in a concerted 
stoppage of work (including stoppage by reason of the expiration of a 
collective-bargaining agreement) or engage in any concerted slowdown or 
other concerted interruption of operation.
    United States worker (``U.S. worker'') means an employee who is 
either
    (1) A citizen or national of the United States, or
    (2) An alien who is lawfully admitted for permanent residence in the 
United States, is admitted as a refugee under section 207 of the INA, is 
granted asylum under section 208 of the INA, or is an immigrant 
otherwise authorized (by the INA or by DHS) to be employed in the United 
States.
    Wage rate means the remuneration (exclusive of fringe benefits) to 
be paid, stated in terms of amount per hour, day, month or year (see 
definition of ``Required Wage Rate'').

[59 FR 65659, 65676, Dec. 20, 1994, as amended at 65 FR 80211, Dec. 20, 
2000; 69 FR 68228, Nov. 23, 2004; 70 FR 72561, Dec. 5, 2005; 71 FR 
35520, June 21, 2006; 73 FR 19948, Apr. 11, 2008; 73 FR 78067, Dec. 19, 
2008]



Sec.  655.720  Where are labor condition applications (LCAs) to be 
filed and processed?

    (a) Employers must file all LCAs regarding H-1B, H-1B1, and E-3 
nonimmigrants through the electronic submission procedure identified in 
paragraph (b) of this section except as provided in the next sentence. 
If a physical disability or lack of access to the Internet prevents an 
employer from using the electronic filing system, an LCA may be filed by 
U.S. Mail in accordance with paragraphs (c) and (d) of this section. 
Requirements for signing, providing public access to, and use of 
certified LCAs are identified inSec. 655.730(c). If the LCA is 
certified by DOL, notice of the certification will be sent to the 
employer by the same means that the employer used to submit the LCA, 
that is, electronically where the Form ETA 9035E was submitted 
electronically, and by U.S. Mail where the Form ETA 9035 was submitted 
by U.S. Mail.
    (b) Electronic submission. Employers must file the electronic LCA, 
Form ETA 9035E, through the Department of Labor's Web site at http://
www.lca.doleta.gov. The employer must follow instructions for electronic 
submission posted on the Web site. In the event ETA implements the 
Government Paperwork Elimination Act (44 U.S.C.A. 3504 n.) and/or the 
Electronic Records and Signatures in Global and National Commerce Act 
(E-SIGN) (15 U.S.C. 7001-7006) for the submission and certification of 
the Form ETA 9035E, instructions will be provided (by public notice(s) 
and by instructions on the Department's Web site) to employers as to how 
the requirements of these statutes will be met in the Form ETA 9035E 
procedures.
    (c) Approval to file LCAs by U.S. Mail. (1) Employers with physical 
disabilities or lacking Internet access and wishing to file LCAs by U.S. 
Mail may submit a written request to the Chief, Division of Foreign 
Labor Certification in accordance with paragraphs (c)(2) through (c)(4) 
of this section. The ETA shall identify the address to which such 
written request shall be mailed in a Notice in the Federal Register and 
on the Department's Web site at http://www.lca.doleta.gov.
    (2) The written request must establish the employer's need to file 
by U.S. Mail, including providing an explanation of how physical 
disability or lack of access to the Internet prevents the employer from 
using the electronic filing system. No particular form or format is 
required for this request.
    (3) ETA will review the submitted justification, and may require the 
employer to submit supporting documentation. In the case of employers 
asserting a lack of Internet access, supporting documentation could, for 
example, consist of documentation that

[[Page 649]]

the Internet cannot be accessed from the employer's worksite or physical 
location (for example because no Internet service provider serves the 
site), and there is no publicly available Internet access, at public 
libraries or elsewhere, within a reasonable distance of the employer. In 
the case of employers with physical disabilities supporting 
documentation could, for example, consist of physicians' statements or 
invoices for medical devices or aids relevant to the employer's 
disability.
    (4) ETA may approve or deny employers' requests to submit LCAs by 
U.S. Mail. Approvals shall be valid for 1 year from the date of 
approval.
    (d) U.S. Mail. If an employer has a valid approval to file by U.S. 
Mail in accordance with paragraph (c) of this section, the employer may 
use Form ETA 9035 and send it by U.S. Mail to ETA. ETA shall publish a 
Notice in the Federal Register identifying the address, and any future 
address changes, to which paper LCAs must be mailed, and shall also post 
these addresses on the DOL Internet Web site at http://
www.lca.doleta.gov. When Form ETA 9035 is submitted by U.S. Mail, the 
form must bear the original signature of the employer (or that of the 
employer's authorized agent or representative) at the time it is 
submitted to ETA.
    (e) The ETA National Office is responsible for policy questions and 
other issues regarding LCAs. Prevailing wage challenges are handled in 
accordance with the procedures identified inSec. 655.731(a)(2).

[70 FR 72561, Dec. 5, 2005, as amended at 73 FR 19949, Apr. 11, 2008]



Sec.  655.721  [Reserved]



Sec.  655.730  What is the process for filing a labor condition
application?

    This section applies to the filing of labor condition applications 
for H-1B, H-1B1, and E-3 nonimmigrants. The term H-1B is meant to apply 
to all three categories unless exceptions are specifically noted.
    (a) Who must submit labor condition applications? An employer, or 
the employer's authorized agent or representative, which meets the 
definition of ``employer'' set forth inSec. 655.715 and intends to 
employ an H-1B nonimmigrant in a specialty occupation or as a fashion 
model of distinguished merit and ability shall submit an LCA to the 
Department.
    (b) Where and when is an LCA to be submitted? An LCA shall be 
submitted by the employer to ETA in accordance with the procedure 
prescribed inSec. 655.720 no earlier than six months before the 
beginning date of the period of intended employment shown on the LCA. It 
is the employer's responsibility to ensure ETA receives a complete and 
accurate LCA. Incomplete or obviously inaccurate LCAs will not be 
certified by ETA. ETA will process all LCAs sequentially and will 
usually make a determination to certify or not certify an LCA within 
seven working days of the date ETA receives the LCA. LCAs filed by U.S. 
Mail may not be processed as quickly as those filed electronically.
    (c) What is to be submitted and what are its contents? Form ETA 9035 
or ETA 9035E.
    (1) General. The employer (or the employer's authorized agent or 
representative) must submit to ETA one completed and dated LCA as 
prescribed inSec. 655.720. The electronic LCA, Form ETA 9035E, is 
found on the DOL Web site where the electronic submission is made, at 
http://www.lca.doleta.gov. Copies of the paper form, Form ETA 9035, and 
cover pages Form ETA 9035CP are available on the DOL Web site at http://
www.ows.doleta.gov and from the ETA National Office, and may be used by 
employers with approval underSec. 655.720 to file by U.S. Mail during 
the approval's validity period.
    (2) Undertaking of the Employer. In submitting the LCA, and by 
affixing the signature of the employer or its authorized agent or 
representative on Form ETA 9035E or Form ETA 9035, the employer (or its 
authorized agent or representative on behalf of the employer) attests 
the statements in the LCA are true and promises to comply with the labor 
condition statements (attestations) specifically identified in Forms ETA 
9035E and ETA 9035, as well as set forth in full in the Form ETA 9035CP. 
The labor condition statements (attestations) are described in detail in 
Sec.Sec. 655.731 through 655.734, and the additional attestations for 
LCAs filed by

[[Page 650]]

certain H-1B-dependent employers and employers found to have willfully 
violated the H-1B program requirements are described in Sec.Sec. 
655.736 through 655.739.
    (3) Signed Originals, Public Access, and Use of Certified LCAs. In 
accordance withSec. 655.760(a) and (a)(1), the employer must maintain 
in its files and make available for public examination the LCA as 
submitted to ETA and as certified by ETA. When Form ETA 9035E is 
submitted electronically, a signed original is created by the employer 
(or by the employer's authorized agent or representative) printing out 
and signing the form immediately upon certification by ETA. When Form 
ETA 9035 is submitted by U.S. Mail as permitted bySec. 655.720(a), the 
form must bear the original signature of the employer (or of the 
employer's authorized agent or representative) when submitted to ETA. 
For H-1B visas only, the employer must submit a copy of the signed, 
certified Form ETA 9035 or ETA 9035E to the U.S. Citizenship and 
Immigration Services (USCIS, formerly INS) in support of the Form I-129 
petition, thereby reaffirming the employer's acceptance of all of the 
attestation obligations in accordance with 8 CFR 214.2(h)(4)(iii)(B)(2).
    (4) Contents of LCA. Each LCA shall identify the occupational 
classification for which the LCA is being submitted and shall state:
    (i) The occupation, by Dictionary of Occupational Titles (DOT) 
Three-Digit Occupational Groups code and by the employer's own title for 
the job;
    (ii) The number of nonimmigrants sought;
    (iii) The gross wage rate to be paid to each nonimmigrant, expressed 
on an hourly, weekly, biweekly, monthly, or annual basis;
    (iv) The starting and ending dates of the nonimmigrants' employment;
    (v) The place(s) of intended employment;
    (vi) The prevailing wage for the occupation in the area of intended 
employment and the specific source (e.g., name of published survey) 
relied upon by the employer to determine the wage. If the wage is 
obtained from a SESA, now known as a State Workforce Agency (SWA), the 
appropriate box must be checked and the wage must be stated; the source 
for a wage obtained from a source other than a SWA must be identified 
along with the wage; and
    (vii) For applications filed regarding H-1B nonimmigrants only (and 
not applications regarding H-1B1 and E-3 nonimmigrants), the employer's 
status as to whether or not the employer is H-1B-dependent and/or a 
willful violator, and, if the employer is H-1B-dependent and/or a 
willful violator, whether the employer will use the application only in 
support of petitions for exempt H-1B nonimmigrants.
    (5) Multiple positions and/or places of employment. The employer 
shall file a separate LCA for each occupation in which the employer 
intends to employ one or more nonimmigrants, but the LCA may cover more 
than one intended position (employment opportunity) within that 
occupation. All intended places of employment shall be identified on the 
LCA; the employer may file one or more additional LCAs to identify 
additional places of employment. Separate LCAs must be filed for H-1B, 
H-1B1, and E-3 nonimmigrants.
    (6) Full-time and part-time jobs. The position(s) covered by the LCA 
may be either full-time or part-time; full-time and part-time positions 
can not be combined on a single LCA.
    (d) What attestations does the LCA contain? An employer's LCA shall 
contain the labor condition statements referenced in Sec.Sec. 655.731 
through 655.734, andSec. 655.736 through 655.739 (if applicable), 
which provide that no individual may be admitted or provided status as 
an H-1B nonimmigrant in an occupational classification unless the 
employer has filed with the Secretary an application stating that:
    (1) The employer is offering and will offer during the period of 
authorized employment to H-1B nonimmigrants no less than the greater of 
the following wages (such offer to include benefits and eligibility for 
benefits provided as compensation for services, which are to be offered 
to the nonimmigrants on the same basis and in accordance with the same 
criteria as the employer offers such benefits to U.S. workers):

[[Page 651]]

    (i) The actual wage paid to the employer's other employees at the 
worksite with similar experience and qualifications for the specific 
employment in question; or
    (ii) The prevailing wage level for the occupational classification 
in the area of intended employment;
    (2) The employer will provide working conditions for such 
nonimmigrants that will not adversely affect the working conditions of 
workers similarly employed (including benefits in the nature of working 
conditions, which are to be offered to the nonimmigrants on the same 
basis and in accordance with the same criteria as the employer offers 
such benefits to U.S. workers);
    (3) There is not a strike or lockout in the course of a labor 
dispute in the occupational classification at the place of employment;
    (4) The employer has provided and will provide notice of the filing 
of the labor condition application to:
    (i)(A) The bargaining representative of the employer's employees in 
the occupational classification in the area of intended employment for 
which the H-1B nonimmigrants are sought, in the manner described in 
Sec.  655.734(a)(1)(i); or
    (B) If there is no such bargaining representative, affected workers 
by providing electronic notice of the filing of the LCA or by posting 
notice in conspicuous locations at the place(s) of employment, in the 
manner described inSec. 655.734(a)(1)(ii); and
    (ii) H-1B nonimmigrants by providing a copy of the LCA to each H-1B 
nonimmigrant at the time that such nonimmigrant actually reports to 
work, in the manner described inSec. 655.734(a)(2).
    (5) For applications filed regarding H-1B nonimmigrants only (and 
not applications regarding H-1B1 or E-3 nonimmigrants), the employer has 
determined its status concerning H-1B-dependency and/or willful violator 
(as described inSec. 655.736), has indicated such status, and if 
either such status is applicable to the employer, has indicated whether 
the LCA will be used only for exempt H-1B nonimmigrant(s), as described 
inSec. 655.737.
    (6) The employer has provided the information about the occupation 
required in paragraph (c) of this section.
    (e) Change in employer's corporate structure or identity. (1) Where 
an employer corporation changes its corporate structure as the result of 
an acquisition, merger, ``spin-off,'' or other such action, the new 
employing entity is not required to file new LCAs and H-1B petitions 
with respect to the H-1B nonimmigrants transferred to the employ of the 
new employing entity (regardless of whether there is a change in the 
Federal Employer Identification Number (FEIN)), provided that the new 
employing entity maintains in its records a list of the H-1B 
nonimmigrants transferred to the employ of the new employing entity, and 
maintains in the public access file(s) (seeSec. 655.760) a document 
containing all of the following:
    (i) Each affected LCA number and its date of certification;
    (ii) A description of the new employing entity's actual wage system 
applicable to H-1B nonimmigrant(s) who become employees of the new 
employing entity;
    (iii) The Federal Employer Identification Number (FEIN) of the new 
employing entity (whether or not different from that of the predecessor 
entity); and
    (iv) A sworn statement by an authorized representative of the new 
employing entity expressly acknowledging such entity's assumption of all 
obligations, liabilities and undertakings arising from or under 
attestations made in each certified and still effective LCA filed by the 
predecessor entity. Unless such statement is executed and made available 
in accordance with this paragraph, the new employing entity shall not 
employ any of the predecessor entity's H-1B nonimmigrants without filing 
new LCAs and petitions for such nonimmigrants. The new employing 
entity's statement shall include such entity's explicit agreement to:
    (A) Abide by the DOL's H-1B regulations applicable to the LCAs;
    (B) Maintain a copy of the statement in the public access file (see 
Sec.  655.760); and
    (C) Make the document available to any member of the public or the 
Department upon request.
    (2) Notwithstanding the provisions of paragraph (e)(1) of this 
section, the new

[[Page 652]]

employing entity must file new LCA(s) and H-1B petition(s) when it hires 
any new H-1B nonimmigrant(s) or seeks extension(s) of H-1B status for 
existing H-1B nonimmigrant(s). In other words, the new employing entity 
may not utilize the predecessor entity's LCA(s) to support the hiring or 
extension of any H-1B nonimmigrant after the change in corporate 
structure.
    (3) A change in an employer's H-1B-dependency status which results 
from the change in the corporate structure has no effect on the 
employer's obligations with respect to its current H-1B nonimmigrant 
employees. However, the new employing entity shall comply withSec. 
655.736 concerning H-1B-dependency and/or willful-violator status and 
Sec.  655.737 concerning exempt H-1B nonimmigrants, in the event that 
such entity seeks to hire new H-1B nonimmigrant(s) or to extend the H-1B 
status of existing H-1B nonimmigrants. (SeeSec. 655.736(d)(6).)

[65 FR 80212, Dec. 20, 2000, as amended at 66 FR 63301, Dec. 5, 2001; 69 
FR 68228, Nov. 23, 2004; 70 FR 72562, Dec. 5, 2005; 71 FR 35521, June 
21, 2006; 73 FR 19949, Apr. 11, 2008]



Sec.  655.731  What is the first LCA requirement, regarding wages?

    An employer seeking to employ H-1B nonimmigrants in a specialty 
occupation or as a fashion model of distinguished merit and ability 
shall state on Form ETA 9035 or 9035E that it will pay the H-1B 
nonimmigrant the required wage rate. For the purposes of this section, 
``H-1B'' includes ``E-3 and H-1B1'' as well.
    (a) Establishing the wage requirement. The first LCA requirement 
shall be satisfied when the employer signs Form ETA 9035 or 9035E 
attesting that, for the entire period of authorized employment, the 
required wage rate will be paid to the H-1B nonimmigrant(s); that is, 
that the wage shall be the greater of the actual wage rate (as specified 
in paragraph (a)(1) of this section) or the prevailing wage (as 
specified in paragraph (a)(2) of this section). The wage requirement 
includes the employer's obligation to offer benefits and eligibility for 
benefits provided as compensation for services to H-1B nonimmigrants on 
the same basis, and in accordance with the same criteria, as the 
employer offers to U.S. workers.
    (1) The actual wage is the wage rate paid by the employer to all 
other individuals with similar experience and qualifications for the 
specific employment in question. In determining such wage level, the 
following factors may be considered: Experience, qualifications, 
education, job responsibility and function, specialized knowledge, and 
other legitimate business factors. ``Legitimate business factors,'' for 
purposes of this section, means those that it is reasonable to conclude 
are necessary because they conform to recognized principles or can be 
demonstrated by accepted rules and standards. Where there are other 
employees with substantially similar experience and qualifications in 
the specific employment in question--i.e., they have substantially the 
same duties and responsibilities as the H-1B nonimmigrant--the actual 
wage shall be the amount paid to these other employees. Where no such 
other employees exist at the place of employment, the actual wage shall 
be the wage paid to the H-1B nonimmigrant by the employer. Where the 
employer's pay system or scale provides for adjustments during the 
period of the LCA--e.g., cost of living increases or other periodic 
adjustments, or the employee moves to a more advanced level in the same 
occupation--such adjustments shall be provided to similarly employed H-
1B nonimmigrants (unless the prevailing wage is higher than the actual 
wage).
    (2) The prevailing wage for the occupational classification in the 
area of intended employment must be determined as of the time of filing 
the application. The employer shall base the prevailing wage on the best 
information available as of the time of filing the application. Except 
as provided in this section, the employer is not required to use any 
specific methodology to determine the prevailing wage and may utilize a 
wage obtained from an OFLC NPC (OES), an independent authoritative 
source, or other legitimate sources of wage data. One of the following 
sources shall be used to establish the prevailing wage:
    (i) A collective bargaining agreement which was negotiated at arms-
length

[[Page 653]]

between a union and the employer which contains a wage rate applicable 
to the occupation;
    (ii) If the job opportunity is in an occupation which is not covered 
by paragraph (a)(2)(i) of this section, the prevailing wage shall be the 
arithmetic mean of the wages of workers similarly employed, except that 
the prevailing wage shall be the median when provided by paragraphs 
(a)(2)(ii)(A), (b)(3)(iii)(B)(2), and (b)(3)(iii)(C)(2) of this section. 
The prevailing wage rate shall be based on the best information 
available. The following prevailing wage sources may be used:
    (A) OFLC National Processing Center (NPC) determination. Prior to 
January 1, 2010, the SWA having jurisdiction over the area of intended 
employment shall continue to receive and process prevailing wage 
determination requests, but shall do so in accordance with these 
regulatory provisions and Department guidance. On or after January 1, 
2010, the NPC shall receive and process prevailing wage determination 
requests in accordance with these regulations and with Department 
guidance. Upon receipt of a written request for a PWD on or after 
January 1, 2010, the NPC will determine whether the occupation is 
covered by a collective bargaining agreement which was negotiated at 
arms length, and, if not, determine the arithmetic mean of wages of 
workers similarly employed in the area of intended employment. The wage 
component of the Bureau of Labor Statistics Occupational Employment 
Statistics survey shall be used to determine the arithmetic mean, unless 
the employer provides an acceptable survey. The NPC shall determine the 
wage in accordance with secs. 212(n) and 212(t) of the INA. If an 
acceptable employer-provided wage survey provides a median and does not 
provide an arithmetic mean, the median shall be the prevailing wage 
applicable to the employer's job opportunity. In making a PWD, the 
Chicago NPC will follow 20 CFR 656.40 and other administrative 
guidelines or regulations issued by ETA. The Chicago NPC shall specify 
the validity period of the PWD, which in no event shall be for less than 
90 days or more than 1 year from the date of the determination.
    (1) An employer who chooses to utilize an NPC PWD shall file the 
labor condition application within the validity period of the prevailing 
wage as specified in the PWD. Any employer desiring review of an NPC 
PWD, including judicial review, shall follow the appeal procedures at 20 
CFR 656.41. Employers which challenge an NPC PWD under 20 CFR 656.41 
must obtain a ruling prior to filing an LCA. In any challenge, the 
Department and the NPC shall not divulge any employer wage data 
collected under the promise of confidentiality. Once an employer obtains 
a PWD from the NPC and files an LCA supported by that PWD, the employer 
is deemed to have accepted the PWD (as to the amount of the wage) and 
thereafter may not contest the legitimacy of the PWD by filing an appeal 
with the CO (see 20 CFR 656.41) or in an investigation or enforcement 
action.
    (2) If the employer is unable to wait for the NPC to produce the 
requested prevailing wage for the occupation in question, or for the CO 
and/or the BALCA to issue a decision, the employer may rely on other 
legitimate sources of available wage information as set forth in 
paragraphs (a)(2)(ii)(B) and (C) of this section. If the employer later 
discovers, upon receipt of the PWD from the NPC, that the information 
relied upon produced a wage below the final PWD and the employer was 
paying the NPC-determined wage, no wage violation will be found if the 
employer retroactively compensates the H-2B nonimmigrant(s) for the 
difference between wage paid and the prevailing wage, within 30 days of 
the employer's receipt of the PWD.
    (3) In all situations where the employer obtains the PWD from the 
NPC, the Department will deem that PWD as correct as to the amount of 
the wage. Nevertheless, the employer must maintain a copy of the NPC 
PWD. A complaint alleging inaccuracy of an NPC PWD, in such cases, will 
not be investigated.
    (B) An independent authoritative source. The employer may use an 
independent authoritative wage source in lieu of an NPC PWD. The 
independent authoritative source survey must meet

[[Page 654]]

all the criteria set forth in paragraph (b)(3)(iii)(B) of this section.
    (C) Another legitimate source of wage information. The employer may 
rely on other legitimate sources of wage data to obtain the prevailing 
wage. The other legitimate source survey must meet all the criteria set 
forth in paragraph (b)(3)(iii)(C) of this section. The employer will be 
required to demonstrate the legitimacy of the wage in the event of an 
investigation.
    (iii) For purposes of this section, ``similarly employed'' means 
``having substantially comparable jobs in the occupational 
classification in the area of intended employment,'' except that if a 
representative sample of workers in the occupational category can not be 
obtained in the area of intended employment, ``similarly employed'' 
means:
    (A) Having jobs requiring a substantially similar level of skills 
within the area of intended employment; or
    (B) If there are no substantially comparable jobs in the area of 
intended employment, having substantially comparable jobs with employers 
outside of the area of intended employment.
    (iv) A prevailing wage determination for LCA purposes made pursuant 
to this section shall not permit an employer to pay a wage lower than 
required under any other applicable Federal, state or local law.
    (v) Where a range of wages is paid by the employer to individuals in 
an occupational classification or among individuals with similar 
experience and qualifications for the specific employment in question, a 
range is considered to meet the prevailing wage requirement so long as 
the bottom of the wage range is at least the prevailing wage rate.
    (vi) The employer shall enter the prevailing wage on the LCA in the 
form in which the employer will pay the wage (e.g., an annual salary or 
an hourly rate), except that in all cases the prevailing wage must be 
expressed as an hourly wage if the H-1B nonimmigrant will be employed 
part-time. Where an employer obtains a prevailing wage determination 
(from any of the sources identified in paragraphs (a)(2)(i) and (ii) of 
this section) that is expressed as an hourly rate, the employer may 
convert this determination to a yearly salary by multiplying the hourly 
rate by 2080. Conversely, where an employer obtains a prevailing wage 
(from any of these sources) that is expressed as a yearly salary, the 
employer may convert this determination to an hourly rate by dividing 
the salary by 2080.
    (vii) In computing the prevailing wage for a job opportunity in an 
occupational classification in an area of intended employment in the 
case of an employee of an institution of higher education or an 
affiliated or related nonprofit entity, a nonprofit research 
organization, or a Governmental research organization as these terms are 
defined in 20 CFR 656.40(e), the prevailing wage level shall only take 
into account employees at such institutions and organizations in the 
area of intended employment.
    (viii) An employer may file more than one LCA for the same 
occupational classification in the same area of employment and, in such 
circumstances, the employer could have H-1B employees in the same 
occupational classification in the same area of employment, brought into 
the U.S. (or accorded H-1B status) based on petitions approved pursuant 
to different LCAs (filed at different times) with different prevailing 
wage determinations. Employers are advised that the prevailing wage rate 
as to any particular H-1B nonimmigrant is prescribed by the LCA which 
supports that nonimmigrant's H-1B petition. The employer is required to 
obtain the prevailing wage at the time that the LCA is filed (see 
paragraph (a)(2) of this section). The LCA is valid for the period 
certified by ETA, and the employer must satisfy all the LCA's 
requirements (including the required wage which encompasses both 
prevailing and actual wage rates) for as long as any H-1B nonimmigrants 
are employed pursuant to that LCA (Sec.  655.750). Where new 
nonimmigrants are employed pursuant to a new LCA, that new LCA 
prescribes the employer's obligations as to those new nonimmigrants. The 
prevailing wage determination on the later/subsequent LCA does not 
``relate back'' to operate as an ``update'' of the prevailing wage for 
the previously-filed

[[Page 655]]

LCA for the same occupational classification in the same area of 
employment. However, employers are cautioned that the actual wage 
component to the required wage may, as a practical matter, eliminate any 
wage-payment differentiation among H-1B employees based on different 
prevailing wage rates stated in applicable LCAs. Every H-1B nonimmigrant 
is to be paid in accordance with the employer's actual wage system, and 
thus is to receive any pay increases which that system provides.
    (3) Once the prevailing wage rate is established, the H-1B employer 
then shall compare this wage with the actual wage rate for the specific 
employment in question at the place of employment and must pay the H-1B 
nonimmigrant at least the higher of the two wages.
    (b) Documentation of the wage statement. (1) The employer shall 
develop and maintain documentation sufficient to meet its burden of 
proving the validity of the wage statement required in paragraph (a) of 
this section and attested to on Form ETA 9035 or 9035E. The 
documentation shall be made available to DOL upon request. Documentation 
shall also be made available for public examination to the extent 
required bySec. 655.760. The employer shall also document that the 
wage rate(s) paid to H-1B nonimmigrant(s) is(are) no less than the 
required wage rate(s). The documentation shall include information about 
the employer's wage rate(s) for all other employees for the specific 
employment in question at the place of employment, beginning with the 
date the labor condition application was submitted and continuing 
throughout the period of employment. The records shall be retained for 
the period of time specified inSec. 655.760. The payroll records for 
each such employee shall include:
    (i) Employee's full name;
    (ii) Employee's home address;
    (iii) Employee's occupation;
    (iv) Employee's rate of pay;
    (v) Hours worked each day and each week by the employee if:
    (A) The employee is paid on other than a salary basis (e.g., hourly, 
piece-rate; commission); or
    (B) With respect only to H-1B nonimmigrants, the worker is a part-
time employee (whether paid a salary or an hourly rate).
    (vi) Total additions to or deductions from pay each pay period, by 
employee; and
    (vii) Total wages paid each pay period, date of pay and pay period 
covered by the payment, by employee.
    (viii) Documentation of offer of benefits and eligibility for 
benefits provided as compensation for services on the same basis, and in 
accordance with the same criteria, as the employer offers to U.S. 
workers (see paragraph (c)(3) of this section):
    (A) A copy of any document(s) provided to employees describing the 
benefits that are offered to employees, the eligibility and 
participation rules, how costs are shared, etc. (e.g., summary plan 
descriptions, employee handbooks, any special or employee-specific 
notices that might be sent);
    (B) A copy of all benefit plans or other documentation describing 
benefit plans and any rules the employer may have for differentiating 
benefits among groups of workers;
    (C) Evidence as to what benefits are actually provided to U.S. 
workers and H-1B nonimmigrants, including evidence of the benefits 
selected or declined by employees where employees are given a choice of 
benefits;
    (D) For multinational employers who choose to provide H-1B 
nonimmigrants with ``home country'' benefits, evidence of the benefits 
provided to the nonimmigrant before and after he/she went to the United 
States. See paragraph (c)(3)(iii)(C) of this section.
    (2) Actual wage. In addition to payroll data required by paragraph 
(b)(1) of this section (and also by the Fair Labor Standards Act), the 
employer shall retain documentation specifying the basis it used to 
establish the actual wage. The employer shall show how the wage set for 
the H-1B nonimmigrant relates to the wages paid by the employer to all 
other individuals with similar experience and qualifications for the 
specific employment in question at the place of employment. Where 
adjustments are made in the employer's pay system or scale during

[[Page 656]]

the validity period of the LCA, the employer shall retain documentation 
explaining the change and clearly showing that, after such adjustments, 
the wages paid to the H-1B nonimmigrant are at least the greater of the 
adjusted actual wage or the prevailing wage for the occupation and area 
of intended employment.
    (3) Prevailing wage. The employer also shall retain documentation 
regarding its determination of the prevailing wage. This source 
documentation shall not be submitted to ETA with the labor condition 
application, but shall be retained at the employer's place of business 
for the length of time required inSec. 655.760(c). Such documentation 
shall consist of the documentation described in paragraph (b)(3)(i), 
(ii), or (iii) of this section and the documentation described in 
paragraph (b)(1) of this section.
    (i) If the employer used a wage determination issued pursuant to the 
provisions of the Davis-Bacon Act, 40 U.S.C. 276a et seq. (see 29 CFR 
part 1), or the McNamara-O'Hara Service Contract Act, 41 U.S.C. 351 et 
seq. (see 29 CFR part 4), the documentation shall include a copy of the 
determination showing the wage rate for the occupation in the area of 
intended employment.
    (ii) If the employer used an applicable wage rate from a union 
contract which was negotiated at arms-length between a union and the 
employer, the documentation shall include an excerpt from the union 
contract showing the wage rate(s) for the occupation.
    (iii) If the employer did not use a wage covered by the provisions 
of paragraph (b)(3)(i) or (b)(3)(ii) of this section, the employer's 
documentation shall consist of:
    (A) A copy of the prevailing wage finding from the NPC for the 
occupation within the area of intended employment.
    (B) A copy of the prevailing wage survey for the occupation within 
the area of intended employment published by an independent 
authoritative source. For purposes of this paragraph (b)(3)(iii)(B), a 
prevailing wage survey for the occupation in the area of intended 
employment published by an independent authoritative source shall mean a 
survey of wages published in a book, newspaper, periodical, loose-leaf 
service, newsletter, or other similar medium, within the 24-month period 
immediately preceding the filing of the employer's application. Such 
survey shall:
    (1) Reflect the weighted average wage paid to workers similarly 
employed in the area of intended employment;
    (2) Reflect the median wage of workers similarly employed in the 
area of intended employment if the survey provides such a median and 
does not provide a weighted average wage of workers similarly employed 
in the area of intended employment;
    (3) Be based upon recently collected data--e.g., within the 24-month 
period immediately preceding the date of publication of the survey; and
    (4) Represent the latest published prevailing wage finding by the 
independent authoritative source for the occupation in the area of 
intended employment; or
    (C) A copy of the prevailing wage survey or other source data 
acquired from another legitimate source of wage information that was 
used to make the prevailing wage determination. For purposes of this 
paragraph (b)(3)(iii)(C), a prevailing wage provided by another 
legitimate source of such wage information shall be one which:
    (1) Reflects the weighted average wage paid to workers similarly 
employed in the area of intended employment;
    (2) Reflect the median wage of workers similarly employed in the 
area of intended employment if the survey provides such a median and 
does not provide a weighted average wage of workers similarly employed 
in the area of intended employment;
    (3) Is based on the most recent and accurate information available; 
and
    (4) Is reasonable and consistent with recognized standards and 
principles in producing a prevailing wage.
    (c) Satisfaction of required wage obligation. (1) The required wage 
must be paid to the employee, cash in hand, free and clear, when due, 
except that deductions made in accordance with paragraph (c)(9) of this 
section may reduce the cash wage below the level of

[[Page 657]]

the required wage. Benefits and eligibility for benefits provided as 
compensation for services must be offered in accordance with paragraph 
(c)(3) of this section.
    (2) ``Cash wages paid,'' for purposes of satisfying the H-1B 
required wage, shall consist only of those payments that meet all the 
following criteria:
    (i) Payments shown in the employer's payroll records as earnings for 
the employee, and disbursed to the employee, cash in hand, free and 
clear, when due, except for deductions authorized by paragraph (c)(9) of 
this section;
    (ii) Payments reported to the Internal Revenue Service (IRS) as the 
employee's earnings, with appropriate withholding for the employee's tax 
paid to the IRS (in accordance with the Internal Revenue Code of 1986, 
26 U.S.C. 1, et seq.);
    (iii) Payments of the tax reported and paid to the IRS as required 
by the Federal Insurance Contributions Act, 26 U.S.C. 3101, et seq. 
(FICA). The employer must be able to document that the payments have 
been so reported to the IRS and that both the employer's and employee's 
taxes have been paid except that when the H-1B nonimmigrant is a citizen 
of a foreign country with which the President of the United States has 
entered into an agreement as authorized by section 233 of the Social 
Security Act, 42 U.S.C. 433 (i.e., an agreement establishing a 
totalization arrangement between the social security system of the 
United States and that of the foreign country), the employer's 
documentation shall show that all appropriate reports have been filed 
and taxes have been paid in the employee's home country.
    (iv) Payments reported, and so documented by the employer, as the 
employee's earnings, with appropriate employer and employee taxes paid 
to all other appropriate Federal, State, and local governments in 
accordance with any other applicable law.
    (v) Future bonuses and similar compensation (i.e., unpaid but to-be-
paid) may be credited toward satisfaction of the required wage 
obligation if their payment is assured (i.e., they are not conditional 
or contingent on some event such as the employer's annual profits). Once 
the bonuses or similar compensation are paid to the employee, they must 
meet the requirements of paragraphs (c)(2)(i) through (iv) of this 
section (i.e., recorded and reported as ``earnings'' with appropriate 
taxes and FICA contributions withheld and paid).
    (3) Benefits and eligibility for benefits provided as compensation 
for services (e.g., cash bonuses; stock options; paid vacations and 
holidays; health, life, disability and other insurance plans; retirement 
and savings plans) shall be offered to the H-1B nonimmigrant(s) on the 
same basis, and in accordance with the same criteria, as the employer 
offers to U.S. workers.
    (i) For purposes of this section, the offer of benefits ``on the 
same basis, and in accordance with the same criteria'' means that the 
employer shall offer H-1B nonimmigrants the same benefit package as it 
offers to U.S. workers, and may not provide more strict eligibility or 
participation requirements for the H-1B nonimmigrant(s) than for 
similarly employed U.S. workers(s) (e.g., full-time workers compared to 
full-time workers; professional staff compared to professional staff). 
H-1B nonimmigrants are not to be denied benefits on the basis that they 
are ``temporary employees'' by virtue of their nonimmigrant status. An 
employer may offer greater or additional benefits to the H-1B 
nonimmigrant(s) than are offered to similarly employed U.S. worker(s), 
provided that such differing treatment is consistent with the 
requirements of all applicable nondiscrimination laws (e.g., Title VII 
of the 1964 Civil Rights Act, 42 U.S.C. 2000e-2000e17). Offers of 
benefits by employers shall be made in good faith and shall result in 
the H-1B nonimmigrant(s)'s actual receipt of the benefits that are 
offered by the employer and elected by the H-1B nonimmigrant(s).
    (ii) The benefits received by the H-1B nonimmigrant(s) need not be 
identical to the benefits received by similarly employed U.S. 
workers(s), provided that the H-1B nonimmigrant is offered the same 
benefits package as those workers but voluntarily chooses to receive 
different benefits (e.g., elects to receive

[[Page 658]]

cash payment rather than stock option, elects not to receive health 
insurance because of required employee contributions, or elects to 
receive different benefits among an array of benefits) or, in those 
instances where the employer is part of a multinational corporate 
operation, the benefits received by the H-1B nonimmigrant are provided 
in accordance with an employer's practice that satisfies the 
requirements of paragraph (c)(3)(iii)(B) or (C) of this section. In all 
cases, however, an employer's practice must comply with the requirements 
of any applicable nondiscrimination laws (e.g., Title VII of the 1964 
Civil Rights Act, 42 U.S.C. 2000e-2000e17).
    (iii) If the employer is part of a multinational corporate operation 
(i.e., operates in affiliation with business entities in other 
countries, whether as subsidiaries or in some other arrangement), the 
following three options (i.e., (A), (B) or (C)) are available to the 
employer with respect to H-1B nonimmigrants who remain on the ``home 
country'' payroll.
    (A) The employer may offer the H-1B nonimmigrant(s) benefits in 
accordance with paragraphs (c)(3)(i) and (ii) of this section.
    (B) Where an H-1B nonimmigrant is in the U.S. for no more than 90 
consecutive calendar days, the employer during that period may maintain 
the H-1B nonimmigrant on the benefits provided to the nonimmigrant in 
his/her permanent work station (ordinarily the home country), and not 
offer the nonimmigrant the benefits that are offered to similarly 
employed U.S. workers, provided that the employer affords reciprocal 
benefits treatment for any U.S. workers (i.e., allows its U.S. 
employees, while working out of the country on a temporary basis away 
from their permanent work stations in the United States, or while 
working in the United States on a temporary basis away from their 
permanent work stations in another country, to continue to receive the 
benefits provided them at their permanent work stations). Employers are 
cautioned that this provision is available only if the employer's 
practices do not constitute an evasion of the benefit requirements, such 
as where the H-1B nonimmigrant remains in the United States for most of 
the year, but briefly returns to the ``home country'' before any 90-day 
period would expire.
    (C) Where an H-1B nonimmigrant is in the U.S. for more than 90 
consecutive calendar days (or from the point where the worker is 
transferred to the U.S. or it is anticipated that the worker will likely 
remain in the U.S. more than 90 consecutive days), the employer may 
maintain the H-1B nonimmigrant on the benefits provided in his/her home 
country (i.e., ``home country benefits'') (and not offer the 
nonimmigrant the benefits that are offered to similarly employed U.S. 
workers) provided that all of the following criteria are satisfied:
    (1) The H-1B nonimmigrant continues to be employed in his/her home 
country (either with the H-1B employer or with a corporate affiliate of 
the employer);
    (2) The H-1B nonimmigrant is enrolled in benefits in his/her home 
country (in accordance with any applicable eligibility standards for 
such benefits);
    (3) The benefits provided in his/her home country are equivalent to, 
or equitably comparable to, the benefits offered to similarly employed 
U.S. workers (i.e., are no less advantageous to the nonimmigrant);
    (4) The employer affords reciprocal benefits treatment for any U.S. 
workers while they are working out of the country, away from their 
permanent work stations (whether in the United States or abroad), on a 
temporary basis (i.e., maintains such U.S. workers on the benefits they 
received at their permanent work stations);
    (5) If the employer offers health benefits to its U.S. workers, the 
employer offers the same plan on the same basis to its H-1B 
nonimmigrants in the United States where the employer does not provide 
the H-1B nonimmigrant with health benefits in the home country, or the 
employer's home-country health plan does not provide full coverage 
(i.e., coverage comparable to what he/she would receive at the home work 
station) for medical treatment in the United States; and
    (6) The employer offers H-1B nonimmigrants who are in the United 
States more than 90 continuous days

[[Page 659]]

those U.S. benefits which are paid directly to the worker (e.g., paid 
vacation, paid holidays, and bonuses).
    (iv) Benefits provided as compensation for services may be credited 
toward the satisfaction of the employer's required wage obligation only 
if the requirements of paragraph (c)(2) of this section are met (e.g., 
recorded and reported as ``earnings'' with appropriate taxes and FICA 
contributions withheld and paid).
    (4) For salaried employees, wages will be due in prorated 
installments (e.g., annual salary divided into 26 bi-weekly pay periods, 
where employer pays bi-weekly) paid no less often than monthly except 
that, in the event that the employer intends to use some other form of 
nondiscretionary payment to supplement the employee's regular/pro-rata 
pay in order to meet the required wage obligation (e.g., a quarterly 
production bonus), the employer's documentation of wage payments 
(including such supplemental payments) must show the employer's 
commitment to make such payment and the method of determining the amount 
thereof, and must show unequivocally that the required wage obligation 
was met for prior pay periods and, upon payment and distribution of such 
other payments that are pending, will be met for each current or future 
pay period. An employer that is a school or other educational 
institution may apply an established salary practice under which the 
employer pays to H-1B nonimmigrants and U.S. workers in the same 
occupational classification an annual salary in disbursements over fewer 
than 12 months, provided that the nonimmigrant agrees to the compressed 
annual salary payments prior to the commencement of the employment and 
the application of the salary practice to the nonimmigrant does not 
otherwise cause him/her to violate any condition of his/her 
authorization under the INA to remain in the U.S.
    (5) For hourly-wage employees, the required wages will be due for 
all hours worked and/or for any nonproductive time (as specified in 
paragraph (c)(7) of this section) at the end of the employee's ordinary 
pay period (e.g., weekly) but in no event less frequently than monthly.
    (6) Subject to the standards specified in paragraph (c)(7) of this 
section (regarding nonproductive status), an H-1B nonimmigrant shall 
receive the required pay beginning on the date when the nonimmigrant 
``enters into employment'' with the employer.
    (i) For purposes of this paragraph (c)(6), the H-1B nonimmigrant is 
considered to ``enter into employment'' when he/she first makes him/
herself available for work or otherwise comes under the control of the 
employer, such as by waiting for an assignment, reporting for 
orientation or training, going to an interview or meeting with a 
customer, or studying for a licensing examination, and includes all 
activities thereafter.
    (ii) Even if the H-1B nonimmigrant has not yet ``entered into 
employment'' with the employer (as described in paragraph (c)(6)(i) of 
this section), the employer that has had an LCA certified and an H-1B 
petition approved for the H-1B nonimmigrant shall pay the nonimmigrant 
the required wage beginning 30 days after the date the nonimmigrant 
first is admitted into the U.S. pursuant to the petition, or, if the 
nonimmigrant is present in the United States on the date of the approval 
of the petition, beginning 60 days after the date the nonimmigrant 
becomes eligible to work for the employer. For purposes of this latter 
requirement, the H-1B nonimmigrant is considered to be eligible to work 
for the employer upon the date of need set forth on the approved H-1B 
petition filed by the employer, or the date of adjustment of the 
nonimmigrant's status by DHS, whichever is later. Matters such as the 
worker's obtaining a State license would not be relevant to this 
determination.
    (7) Wage obligation(s) for H-1B nonimmigrant in nonproductive 
status--(i) Circumstances where wages must be paid. If the H-1B 
nonimmigrant is not performing work and is in a nonproductive status due 
to a decision by the employer (e.g., because of lack of assigned work), 
lack of a permit or license, or any other reason except as specified in 
paragraph (c)(7)(ii) of this section, the employer is required to pay 
the salaried employee the full pro-rata amount

[[Page 660]]

due, or to pay the hourly-wage employee for a full-time week (40 hours 
or such other number of hours as the employer can demonstrate to be 
full-time employment for hourly employees, or the full amount of the 
weekly salary for salaried employees) at the required wage for the 
occupation listed on the LCA. If the employer's LCA carries a 
designation of ``part-time employment,'' the employer is required to pay 
the nonproductive employee for at least the number of hours indicated on 
the I-129 petition filed by the employer with the DHS and incorporated 
by reference on the LCA. If the I-129 indicates a range of hours for 
part-time employment, the employer is required to pay the nonproductive 
employee for at least the average number of hours normally worked by the 
H-1B nonimmigrant, provided that such average is within the range 
indicated; in no event shall the employee be paid for fewer than the 
minimum number of hours indicated for the range of part-time employment. 
In all cases the H-1B nonimmigrant must be paid the required wage for 
all hours performing work within the meaning of the Fair Labor Standards 
Act, 29 U.S.C. 201 et seq.
    (ii) Circumstances where wages need not be paid. If an H-1B 
nonimmigrant experiences a period of nonproductive status due to 
conditions unrelated to employment which take the nonimmigrant away from 
his/her duties at his/her voluntary request and convenience (e.g., 
touring the U.S., caring for ill relative) or render the nonimmigrant 
unable to work (e.g., maternity leave, automobile accident which 
temporarily incapacitates the nonimmigrant), then the employer shall not 
be obligated to pay the required wage rate during that period, provided 
that such period is not subject to payment under the employer's benefit 
plan or other statutes such as the Family and Medical Leave Act (29 
U.S.C. 2601 et seq.) or the Americans with Disabilities Act (42 U.S.C. 
12101 et seq.). Payment need not be made if there has been a bona fide 
termination of the employment relationship. DHS regulations require the 
employer to notify the DHS that the employment relationship has been 
terminated so that the petition is canceled (8 CFR 214.2(h)(11)), and 
require the employer to provide the employee with payment for 
transportation home under certain circumstances (8 CFR 
214.2(h)(4)(iii)(E)).
    (8) If the employee works in an occupation other than that 
identified on the employer's LCA, the employer's required wage 
obligation is based on the occupation identified on the LCA, and not on 
whatever wage standards may be applicable in the occupation in which the 
employee may be working.
    (9) ``Authorized deductions,'' for purposes of the employer's 
satisfaction of the H-1B required wage obligation, means a deduction 
from wages in complete compliance with one of the following three sets 
of criteria (i.e., paragraph (c)(9)(i), (ii), or (iii))--
    (i) Deduction which is required by law (e.g., income tax; FICA); or
    (ii) Deduction which is authorized by a collective bargaining 
agreement, or is reasonable and customary in the occupation and/or area 
of employment (e.g., union dues; contribution to premium for health 
insurance policy covering all employees; savings or retirement fund 
contribution for plan(s) in compliance with the Employee Retirement 
Income Security Act, 29 U.S.C. 1001, et seq.), except that the deduction 
may not recoup a business expense(s) of the employer (including attorney 
fees and other costs connected to the performance of H-1B program 
functions which are required to be performed by the employer, e.g., 
preparation and filing of LCA and H-1B petition); the deduction must 
have been revealed to the worker prior to the commencement of employment 
and, if the deduction was a condition of employment, had been clearly 
identified as such; and the deduction must be made against wages of U.S. 
workers as well as H-1B nonimmigrants (where there are U.S. workers); or
    (iii) Deduction which meets the following requirements:
    (A) Is made in accordance with a voluntary, written authorization by 
the employee (Note to paragraph (c)(9)(iii)(A): an employee's mere 
acceptance of a job which carries a deduction as a condition of 
employment does

[[Page 661]]

not constitute voluntary authorization, even if such condition were 
stated in writing);
    (B) Is for a matter principally for the benefit of the employee 
(Note to paragraph (c)(9)(iii)(B): housing and food allowances would be 
considered to meet this ``benefit of employee'' standard, unless the 
employee is in travel status, or unless the circumstances indicate that 
the arrangements for the employee's housing or food are principally for 
the convenience or benefit of the employer (e.g., employee living at 
worksite in ``on call'' status));
    (C) Is not a recoupment of the employer's business expense (e.g., 
tools and equipment; transportation costs where such transportation is 
an incident of, and necessary to, the employment; living expenses when 
the employee is traveling on the employer's business; attorney fees and 
other costs connected to the performance of H-1B program functions which 
are required to be performed by the employer (e.g., preparation and 
filing of LCA and H-1B petition)). (For purposes of this section, 
initial transportation from, and end-of-employment travel, to the 
worker's home country shall not be considered a business expense.);
    (D) Is an amount that does not exceed the fair market value or the 
actual cost (whichever is lower) of the matter covered (Note to 
paragraph (c)(9)(iii)(D): The employer must document the cost and 
value); and
    (E) Is an amount that does not exceed the limits set for garnishment 
of wages in the Consumer Credit Protection Act, 15 U.S.C. 1673, and the 
regulations of the Secretary pursuant to that Act, 29 CFR part 870, 
under which garnishment(s) may not exceed 25 percent of an employee's 
disposable earnings for a workweek.
    (10) A deduction from or reduction in the payment of the required 
wage is not authorized (and is therefore prohibited) for the following 
purposes (i.e., paragraphs (c)(10) (i) and (ii)):
    (i) A penalty paid by the H-1B nonimmigrant for ceasing employment 
with the employer prior to a date agreed to by the nonimmigrant and the 
employer.
    (A) The employer is not permitted to require (directly or 
indirectly) that the nonimmigrant pay a penalty for ceasing employment 
with the employer prior to an agreed date. Therefore, the employer shall 
not make any deduction from or reduction in the payment of the required 
wage to collect such a penalty.
    (B) The employer is permitted to receive bona fide liquidated 
damages from the H-1B nonimmigrant who ceases employment with the 
employer prior to an agreed date. However, the requirements of paragraph 
(c)(9)(iii) of this section must be fully satisfied, if such damages are 
to be received by the employer via deduction from or reduction in the 
payment of the required wage.
    (C) The distinction between liquidated damages (which are 
permissible) and a penalty (which is prohibited) is to be made on the 
basis of the applicable State law. In general, the laws of the various 
States recognize that liquidated damages are amounts which are fixed or 
stipulated by the parties at the inception of the contract, and which 
are reasonable approximations or estimates of the anticipated or actual 
damage caused to one party by the other party's breach of the contract. 
On the other hand, the laws of the various States, in general, consider 
that penalties are amounts which (although fixed or stipulated in the 
contract by the parties) are not reasonable approximations or estimates 
of such damage. The laws of the various States, in general, require that 
the relation or circumstances of the parties, and the purpose(s) of the 
agreement, are to be taken into account, so that, for example, an 
agreement to a payment would be considered to be a prohibited penalty 
where it is the result of fraud or where it cloaks oppression. 
Furthermore, as a general matter, the sum stipulated must take into 
account whether the contract breach is total or partial (i.e., the 
percentage of the employment contract completed). (See, e.g., Vanderbilt 
University v. DiNardo, 174 F.3d 751 (6th Cir. 1999) (applying Tennessee 
law); Overholt Crop Insurance Service Co. v. Travis, 941 F.2d 1361 (8th 
Cir. 1991) (applying Minnesota and South Dakota law); BDO Seidman v. 
Hirshberg, 712 N.E.2d 1220 (N.Y. 1999); Guiliano v. Cleo, Inc., 995 
S.W.2d 88

[[Page 662]]

(Tenn. 1999); Wojtowicz v. Greeley Anesthesia Services, P.C., 961 P.2d 
520 (Colo.Ct.App. 1998); see generally, Restatement (Second) Contracts 
Sec.  356 (comment b); 22 Am.Jur.2d Damages Sec.Sec. 683, 686, 690, 
693, 703). In an enforcement proceeding under subpart I of this part, 
the Administrator shall determine, applying relevant State law 
(including consideration where appropriate to actions by the employer, 
if any, contributing to the early cessation, such as the employer's 
constructive discharge of the nonimmigrant or non-compliance with its 
obligations under the INA and its regulations) whether the payment in 
question constitutes liquidated damages or a penalty. (Note to paragraph 
(c)(10)(i)(C): The $500/$1,000 filing fee, if any, under section 214(c) 
of the INA can never be included in any liquidated damages received by 
the employer. See paragraph (c)(10)(ii), which follows.)
    (ii) A rebate of the $500/$1,000 filing fee paid by the employer, if 
any, under section 214(c) of the INA. The employer may not receive, and 
the H-1B nonimmigrant may not pay, any part of the $500 additional 
filing fee (for a petition filed prior to December 18, 2000) or $1,000 
additional filing fee (for a petition filed on or subsequent to December 
18, 2000), whether directly or indirectly, voluntarily or involuntarily. 
Thus, no deduction from or reduction in wages for purposes of a rebate 
of any part of this fee is permitted. Further, if liquidated damages are 
received by the employer from the H-1B nonimmigrant upon the 
nonimmigrant's ceasing employment with the employer prior to a date 
agreed to by the nonimmigrant and the employer, such liquidated damages 
shall not include any part of the $500/$1,000 filing fee (see paragraph 
(c)(10)(i) of this section). If the filing fee is paid by a third party 
and the H-1B nonimmigrant reimburses all or part of the fee to such 
third party, the employer shall be considered to be in violation of this 
prohibition since the employer would in such circumstances have been 
spared the expense of the fee which the H-1B nonimmigrant paid.
    (11) Any unauthorized deduction taken from wages is considered by 
the Department to be non-payment of that amount of wages, and in the 
event of an investigation, will result in back wage assessment (plus 
civil money penalties and/or disqualification from H-1B and other 
immigration programs, if willful).
    (12) Where the employer depresses the employee's wages below the 
required wage by imposing on the employee any of the employer's business 
expenses(s), the Department will consider the amount to be an 
unauthorized deduction from wages even if the matter is not shown in the 
employer's payroll records as a deduction.
    (13) Where the employer makes deduction(s) for repayment of loan(s) 
or wage advance(s) made to the employee, the Department, in the event of 
an investigation, will require the employer to establish the legitimacy 
and purpose(s) of the loan(s) or wage advance(s), with reference to the 
standards set out in paragraph (c)(9)(iii) of this section.
    (d) Enforcement actions. (1) In the event that a complaint is filed 
pursuant to subpart I of this part, alleging a failure to meet the 
``prevailing wage'' condition or a material misrepresentation by the 
employer regarding the payment of the required wage, or pursuant to such 
other basis for investigation as the Administrator may find, the 
Administrator shall determine whether the employer has the documentation 
required in paragraph (b)(3)of this section, and whether the 
documentation supports the employer's wage attestation. Where the 
documentation is either nonexistent or is insufficient to determine the 
prevailing wage (e.g., does not meet the criteria specified in this 
section, in which case the Administrator may find a violation of 
paragraph (b)(1), (2), or (3), of this section); or where, based on 
significant evidence regarding wages paid for the occupation in the area 
of intended employment, the Administrator has reason to believe that the 
prevailing wage finding obtained from an independent authoritative 
source or another legitimate source varies substantially from the wage 
prevailing for the occupation in the area of intended employment; or 
where the employer has been unable to demonstrate that

[[Page 663]]

the prevailing wage determined by another legitimate source is in 
accordance with the regulatory criteria, the Administrator may contact 
ETA, which shall provide the Administrator with a prevailing wage 
determination, which the Administrator shall use as the basis for 
determining violations and for computing back wages, if such wages are 
found to be owed. The 30-day investigatory period shall be suspended 
while ETA makes the prevailing wage determination and, in the event that 
the employer timely challenges the determination (seeSec. 
655.731(d)(2)), shall be suspended until the challenge process is 
completed and the Administrator's investigation can be resumed.
    (2) In the event the Administrator obtains a prevailing wage from 
ETA pursuant to paragraph (d)(1) of this section, and the employer 
desires review, including judicial review, the employer shall challenge 
the ETA prevailing wage only by filing a request for review underSec. 
656.41 of this chapter within 30 days of the employer's receipt of the 
PWD from the Administrator. If the request is timely filed, the decision 
of OFLC is suspended until the Center Director issues a determination on 
the employer's appeal. If the employer desires review, including 
judicial review, of the decision of the NPC Center Director, the 
employer shall make a request for review of the determination by the 
Board of Alien Labor Certification Appeals (BALCA) underSec. 656.41(e) 
of this chapter within 30 days of the receipt of the decision of the 
Center Director. If a request for review is timely filed with the BALCA, 
the determination by the Center Director is suspended until the BALCA 
issues a determination on the employer's appeal. In any challenge to the 
wage determination, neither ETA nor the NPC shall divulge any employer 
wage data collected under the promise of confidentiality.
    (i) Where an employer timely challenges an OFLC PWD obtained by the 
Administrator, the 30-day investigative period shall be suspended until 
the employer obtains a final ruling. Upon such a final ruling, the 
investigation and any subsequent enforcement proceeding shall continue, 
with the PWD as determined by the BALCA serving as the conclusive 
determination for all purposes.
    (ii) [Reserved]
    (3) For purposes of this paragraph (d), OFLC may consult with the 
NPC to ascertain the prevailing wage applicable under the circumstances 
of the particular complaint.

[65 FR 80214, Dec. 20, 2000, as amended at 66 FR 63302, Dec. 5, 2001; 69 
FR 68228, Nov. 23, 2004; 69 FR 77384, Dec. 27, 2004; 71 FR 35521, June 
21, 2006; 73 FR 19949, Apr. 11, 2008; 73 FR 78067, Dec. 19, 2008; 74 FR 
45561, Sept. 3, 2009]



Sec.  655.732  What is the second LCA requirement, regarding working
conditions?

    An employer seeking to employ H-1B nonimmigrants in specialty 
occupations or as fashion models of distinguished merit and ability 
shall state on Form ETA 9035 or 9035E that the employment of H-1B 
nonimmigrants will not adversely affect the working conditions of 
workers similarly employed in the area of intended employment. For the 
purposes of this section, ``H-1B'' includes ``E-3 and H-1B1'' as well.
    (a) Establishing the working conditions requirement. The second LCA 
requirement shall be satisfied when the employer affords working 
conditions to its H-1B nonimmigrant employees on the same basis and in 
accordance with the same criteria as it affords to its U.S. worker 
employees who are similarly employed, and without adverse effect upon 
the working conditions of such U.S. worker employees. Working conditions 
include matters such as hours, shifts, vacation periods, and benefits 
such as seniority-based preferences for training programs and work 
schedules. The employer's obligation regarding working conditions shall 
extend for the longer of two periods: the validity period of the 
certified LCA, or the period during which the H-1B nonimmigrant(s) 
is(are) employed by the employer.
    (b) Documentation of the working condition statement. In the event 
of an enforcement action pursuant to subpart I of this part, the 
employer shall produce documentation to show that it has afforded its H-
1B nonimmigrant employees working conditions on the same basis and in 
accordance with the same

[[Page 664]]

criteria as it affords its U.S. worker employees who are similarly 
employed.

[65 FR 80221, Dec. 20, 2000, as amended at 66 FR 63302, Dec. 5, 2001; 73 
FR 19949, Apr. 11, 2008]



Sec.  655.733  What is the third LCA requirement, regarding strikes
and lockouts?

    An employer seeking to employ H-1B nonimmigrants shall state on Form 
ETA 9035 or 9035E that there is not at that time a strike or lockout in 
the course of a labor dispute in the occupational classification at the 
place of employment. A strike or lockout which occurs after the labor 
condition application is filed by the employer with DOL is covered by 
DHS regulations at 8 CFR 214.2(h)(17). For the purposes of this section, 
``H-1B'' includes ``E-3 and H-1B1'' as well.
    (a) Establishing the no strike or lockout requirement. The third 
labor condition application requirement shall be satisfied when the 
employer signs the labor condition application attesting that, as of the 
date the application is filed, the employer is not involved in a strike, 
lockout, or work stoppage in the course of a labor dispute in the 
occupational classification in the area of intended employment. Labor 
disputes for the purpose of this section relate only to those disputes 
involving employees of the employer working at the place of employment 
in the occupational classification named in the labor condition 
application. See also DHS regulations at 8 CFR 214.2(h)(17) for effects 
of strikes or lockouts in general on the H-1B nonimmigrant's employment.
    (1) Strike or lockout subsequent to certification of labor condition 
application. In order to remain in compliance with the no strike or 
lockout labor condition statement, if a strike or lockout of workers in 
the same occupational classification as the H-1B nonimmigrant occurs at 
the place of employment during the validity of the labor condition 
application, the employer, within three days of the occurrence of the 
strike or lockout, shall submit to ETA, by U.S. mail, facsimile (FAX), 
or private carrier, written notice of the strike or lockout. Further, 
the employer shall not place, assign, lease, or otherwise contract out 
an H-1B nonimmigrant, during the entire period of the labor condition 
application's validity, to any place of employment where there is a 
strike or lockout in the course of a labor dispute in the same 
occupational classification as the H-1B nonimmigrant. Finally, the 
employer shall not use the labor condition application in support of any 
petition filings for H-1B nonimmigrants to work in such occupational 
classification at such place of employment until ETA determines that the 
strike or lockout has ended.
    (2) ETA notice to DHS. Upon receiving from an employer a notice 
described in paragraph (a)(1) of this section, ETA shall examine the 
documentation, and may consult with the union at the employer's place of 
business or other appropriate entities. If ETA determines that the 
strike or lockout is covered under DHS's ``Effect of strike'' regulation 
for ``H'' visa holders, ETA shall certify to DHS, in the manner set 
forth in that regulation, that a strike or other labor dispute involving 
a work stoppage of workers in the same occupational classification as 
the H-1B nonimmigrant is in progress at the place of employment. See 8 
CFR 214.2(h)(17).
    (b) Documentation of the third labor condition statement. The 
employer need not develop nor maintain documentation to substantiate the 
statement referenced in paragraph (a) of this section. In the case of an 
investigation, however, the employer has the burden of proof to show 
that there was no strike or lockout in the course of a labor dispute for 
the occupational classification in which an H-1B nonimmigrant is 
employed, either at the time the application was filed or during the 
validity period of the LCA.

[59 FR 65659, 65676, Dec. 20, 1994 as amended at 66 FR 63302, Dec. 5, 
2001; 73 FR 19949, Apr. 11, 2008]



Sec.  655.734  What is the fourth LCA requirement, regarding notice?

    An employer seeking to employ H-1B nonimmigrants shall state on Form 
ETA 9035 or 9035E that the employer has provided notice of the filing of 
the labor condition application to the bargaining representative of the 
employer's employees in the occupational

[[Page 665]]

classification in which the H-1B nonimmigrants will be employed or are 
intended to be employed in the area of intended employment, or, if there 
is no such bargaining representative, has posted notice of filing in 
conspicuous locations in the employer's establishment(s) in the area of 
intended employment, in the manner described in this section. For the 
purposes of this section, ``H-1B'' includes ``E-3 and H-1B1'' as well.
    (a) Establishing the notice requirement. The fourth labor condition 
application requirement shall be established when the conditions of 
paragraphs (a)(1) and (a)(2) of this section are met.
    (1)(i) Where there is a collective bargaining representative for the 
occupational classification in which the H-1B nonimmigrants will be 
employed, on or within 30 days before the date the labor condition 
application is filed with ETA, the employer shall provide notice to the 
bargaining representative that a labor condition application is being, 
or will be, filed with ETA. The notice shall identify the number of H-1B 
nonimmigrants the employer is seeking to employ; the occupational 
classification in which the H-1B nonimmigrants will be employed; the 
wages offered; the period of employment; and the location(s) at which 
the H-1B nonimmigrants will be employed. Notice under this paragraph 
(a)(1)(i) shall include the following statement: ``Complaints alleging 
misrepresentation of material facts in the labor condition application 
and/or failure to comply with the terms of the labor condition 
application may be filed with any office of the Wage and Hour Division 
of the United States Department of Labor.''
    (ii) Where there is no collective bargaining representative, the 
employer shall, on or within 30 days before the date the LCA is filed 
with ETA, provide a notice of the filing of the LCA. The notice shall 
indicate that H-1B nonimmigrants are sought; the number of such 
nonimmigrants the employer is seeking; the occupational classification; 
the wages offered; the period of employment; the location(s) at which 
the H-1B nonimmigrants will be employed; and that the LCA is available 
for public inspection at the H-1B employer's principal place of business 
in the U.S. or at the worksite. The notice shall also include the 
statement: ``Complaints alleging misrepresentation of material facts in 
the labor condition application and/or failure to comply with the terms 
of the labor condition application may be filed with any office of the 
Wage and Hour Division of the United States Department of Labor.'' If 
the employer is an H-1B-dependent employer or a willful violator, and 
the LCA is not being used only for exempt H-1B nonimmigrants, the notice 
shall also set forth the nondisplacement and recruitment obligations to 
which the employer has attested, and shall include the following 
additional statement: ``Complaints alleging failure to offer employment 
to an equally or better qualified U.S. applicant or an employer's 
misrepresentation regarding such offers of employment may be filed with 
the Department of Justice, Civil Rights Division, Office of Special 
Counsel for Immigration-Related Unfair Employment Practices, 950 
Pennsylvania Avenue, NW., Washington, DC 20530, Telephone: 1 (800) 255-
8155 (employers), 1 (800) 255-7688 (employees); Web address: http://
www.usdoj.gov/crt/osc.'' The notice shall be provided in one of the two 
following manners:
    (A) Hard copy notice, by posting a notice in at least two 
conspicuous locations at each place of employment where any H-1B 
nonimmigrant will be employed (whether such place of employment is owned 
or operated by the employer or by some other person or entity).
    (1) The notice shall be of sufficient size and visibility, and shall 
be posted in two or more conspicuous places so that workers in the 
occupational classification at the place(s) of employment can easily see 
and read the posted notice(s).
    (2) Appropriate locations for posting the notices include, but are 
not limited to, locations in the immediate proximity of wage and hour 
notices required by 29 CFR 516.4 or occupational safety and health 
notices required by 29 CFR 1903.2(a).
    (3) The notices shall be posted on or within 30 days before the date 
the labor

[[Page 666]]

condition application is filed and shall remain posted for a total of 10 
days.
    (B) Electronic notice, by providing electronic notification to 
employees in the occupational classification (including both employees 
of the H-1B employer and employees of another person or entity which 
owns or operates the place of employment) for which H-1B nonimmigrants 
are sought, at each place of employment where any H-1B nonimmigrant will 
be employed. Such notification shall be given on or within 30 days 
before the date the labor condition application is filed, and shall be 
available to the affected employees for a total of 10 days, except that 
if employees are provided individual, direct notice (as by e-mail), 
notification only need be given once during the required time period. 
Notification shall be readily available to the affected employees. An 
employer may accomplish this by any means it ordinarily uses to 
communicate with its workers about job vacancies or promotion 
opportunities, including through its ``home page'' or ``electronic 
bulletin board'' to employees who have, as a practical matter, direct 
access to these resources; or through e-mail or an actively circulated 
electronic message such as the employer's newsletter. Where affected 
employees at the place of employment are not on the ``intranet'' which 
provides direct access to the home page or other electronic site but do 
have computer access readily available, the employer may provide notice 
to such workers by direct electronic communication such as e-mail (i.e., 
a single, personal e-mail message to each such employee) or by arranging 
to have the notice appear for 10 days on an intranet which includes the 
affected employees (e.g., contractor arranges to have notice on 
customer's intranet accessible to affected employees). Where employees 
lack practical computer access, a hard copy must be posted in accordance 
with paragraph (a)(1)(ii)(A) of this section, or the employer may 
provide employees individual copies of the notice.
    (2) Where the employer places any H-1B nonimmigrant(s) at one or 
more worksites not contemplated at the time of filing the application, 
but which are within the area of intended employment listed on the LCA, 
the employer is required to post electronic or hard-copy notice(s) at 
such worksite(s), in the manner described in paragraph (a)(1) of this 
section, on or before the date any H-1B nonimmigrant begins work.
    (3) The employer shall, no later than the date the H-1B nonimmigrant 
reports to work at the place of employment, provide the H-1B 
nonimmigrant with a copy of the LCA (Form ETA 9035, or Form ETA 9035E) 
certified by ETA and signed by the employer (or by the employer's 
authorized agent or representative). Upon request, the employer shall 
provide the H-1B nonimmigrant with a copy of the cover pages, Form ETA 
9035CP.
    (b) Documentation of the fourth labor condition statement. The 
employer shall develop and maintain documentation sufficient to meet its 
burden of proving the validity of the statement referenced in paragraph 
(a) of this section and attested to on Form ETA 9035 or 9035E. Such 
documentation shall include a copy of the dated notice and the name and 
address of the collective bargaining representative to whom the notice 
was provided. Where there is no collective bargaining representative, 
the employer shall note and retain the dates when, and locations where, 
the notice was posted and shall retain a copy of the posted notice.
    (c) Records retention; records availability. The employer's 
documentation shall not be submitted to ETA with the labor condition 
application, but shall be retained for the period of time specified in 
Sec.  655.760(c) of this part. The documentation shall be made available 
for public examination as required inSec. 655.760(a) of this part, and 
shall be made available to DOL upon request.

[65 FR 65659, 65676, Dec. 20, 1994, as amended at 65 FR 80221, Dec. 20, 
2000; 66 FR 63302, Dec. 5, 2001; 70 FR 72563, Dec. 5, 2005; 73 FR 19949, 
Apr. 11, 2008]



Sec.  655.735  What are the special provisions for short-term 
placement of H-1B nonimmigrants at place(s) of employment outside 
the area(s) of intended employment listed on the LCA?

    This section does not apply to E-3 and H-1B1 nonimmigrants.

[[Page 667]]

    (a) Subject to the conditions specified in this section, an employer 
may make short-term placements or assignments of H-1B nonimmigrant(s) at 
worksite(s) (place(s) of employment) in areas not listed on the 
employer's approved LCA(s) without filing new labor condition 
application(s) for such area(s).
    (b) The following conditions must be fully satisfied by an employer 
during all short-term placement(s) or assignment(s) of H-1B 
nonimmigrant(s) at worksite(s) (place(s) of employment) in areas not 
listed on the employer's approved LCA(s):
    (1) The employer has fully satisfied the requirements of Sec.Sec. 
655.730 through 655.734 with regard to worksite(s) located within the 
area(s) of intended employment listed on the employer's LCA(s).
    (2) The employer shall not place, assign, lease, or otherwise 
contract out any H-1B nonimmigrant(s) to any worksite where there is a 
strike or lockout in the course of a labor dispute in the same 
occupational classification(s) as that of the H-1B nonimmigrant(s).
    (3) For every day the H-1B nonimmigrant(s) is placed or assigned 
outside the area(s) of employment listed on the approved LCA(s) for such 
worker(s), the employer shall:
    (i) Continue to pay such worker(s) the required wage (based on the 
prevailing wage at such worker's(s') permanent worksite, or the 
employer's actual wage, whichever is higher);
    (ii) Pay such worker(s) the actual cost of lodging (for both 
workdays and non-workdays); and
    (iii) Pay such worker(s) the actual cost of travel, meals and 
incidental or miscellaneous expenses (for both workdays and non-
workdays).
    (c) An employer's short-term placement(s) or assignment(s) of H-1B 
nonimmigrant(s) at any worksite(s) in an area of employment not listed 
on the employer's approved LCA(s) shall not exceed a total of 30 
workdays in a one-year period for any H-1B nonimmigrant at any worksite 
or combination of worksites in the area, except that such placement or 
assignment of an H-1B nonimmigrant may be for longer than 30 workdays 
but for no more than a total of 60 workdays in a one-year period where 
the employer is able to show the following:
    (1) The H-1B nonimmigrant continues to maintain an office or work 
station at his/her permanent worksite (e.g., the worker has a dedicated 
workstation and telephone line(s) at the permanent worksite);
    (2) The H-1B nonimmigrant spends a substantial amount of time at the 
permanent worksite in a one-year period; and
    (3) The H-1B nonimmigrant's U.S. residence or place of abode is 
located in the area of the permanent worksite and not in the area of the 
short-term worksite(s) (e.g., the worker's personal mailing address; the 
worker's lease for an apartment or other home; the worker's bank 
accounts; the worker's automobile driver's license; the residence of the 
worker's dependents).
    (d) For purposes of this section, the term workday shall mean any 
day on which an H-1B nonimmigrant performs any work at any worksite(s) 
within the area of short-term placement or assignment. For example, 
three workdays would be counted where a nonimmigrant works three non-
consecutive days at three different worksites (whether or not the 
employer owns or controls such worksite(s)), within the same area of 
employment. Further, for purposes of this section, the term one-year 
period shall mean the calendar year (i.e., January 1 through December 
31) or the employer's fiscal year, whichever the employer chooses.
    (e) The employer may not make short-term placement(s) or 
assignment(s) of H-1B nonimmigrant(s) under this section at worksite(s) 
in any area of employment for which the employer has a certified LCA for 
the occupational classification. Further, an H-1B nonimmigrant entering 
the U.S. is required to be placed at a worksite in accordance with the 
approved petition and supporting LCA; thus, the nonimmigrant's initial 
placement or assignment cannot be a short-term placement under this 
section. In addition, the employer may not continuously rotate H-1B 
nonimmigrants on short-term placement or assignment to an area of 
employment in a manner that would defeat the purpose of the short-

[[Page 668]]

term placement option, which is to provide the employer with flexibility 
in assignments to afford enough time to obtain an approved LCA for an 
area where it intends to have a continuing presence (e.g., an employer 
may not rotate H-1B nonimmigrants to an area of employment for 20-day 
periods, with the result that nonimmigrants are continuously or 
virtually continuously employed in the area of employment, in order to 
avoid filing an LCA; such an employer would violate the short-term 
placement provisions).
    (f) Once any H-1B nonimmigrant's short-term placement or assignment 
has reached the workday limit specified in paragraph (c) of this section 
in an area of employment, the employer shall take one of the following 
actions:
    (1) File an LCA and obtain ETA certification, and thereafter place 
any H-1B nonimmigrant(s) in that occupational classification at 
worksite(s) in that area pursuant to the LCA (i.e., the employer shall 
perform all actions required in connection with such LCA, including 
determination of the prevailing wage and notice to workers); or
    (2) Immediately terminate the placement of any H-1B nonimmigrant(s) 
who reaches the workday limit in an area of employment. No worker may 
exceed the workday limit within the one-year period specified in 
paragraph (d) of this section, unless the employer first files an LCA 
for the occupational classification for the area of employment. 
Employers are cautioned that if any worker exceeds the workday limit 
within the one-year period, then the employer has violated the terms of 
its LCA(s) and the regulations in the subpart, and thereafter the short-
term placement option cannot be used by the employer for H-1B 
nonimmigrants in that occupational classification in that area of 
employment.
    (g) An employer is not required to use the short-term placement 
option provided by this section, but may choose to make each placement 
or assignment of an H-1B nonimmigrant at worksite(s) in a new area of 
employment pursuant to a new LCA for such area. Further, an employer 
which uses the short-term placement option is not required to continue 
to use the option. Such an employer may, at any time during the period 
identified in paragraphs (c) and (d) of this section, file an LCA for 
the new area of employment (performing all actions required in 
connection with such LCA); upon certification of such LCA, the 
employer's obligation to comply with this section concerning short-term 
placement shall terminate. (However, seeSec. 655.731(c)(9)(iii)(C) 
regarding payment of business expenses for employee's travel on 
employer's business.)

[65 FR 80222, Dec. 20, 2000, as amended at 73 FR 19949, Apr. 11, 2008]



Sec.  655.736  What are H-1B-dependent employers and willful
violators?

    Two attestation obligations apply only to two types of employers: H-
1B-dependent employers (as described in paragraphs (a) through (e) of 
this section) and employers found to have willfully violated their H-1B 
obligations within a certain five-year period (as described in paragraph 
(f) of this section). These obligations apply only to certain labor 
condition applications filed by such employers (as described in 
paragraph (g) of this section), and do not apply to LCAs filed by such 
employers solely for the employment of ``exempt'' H-1B nonimmigrants (as 
described in paragraph (g) of this section andSec. 655.737). These 
obligations require that such employers not displace U.S. workers from 
jobs (as described inSec. 655.738) and that such employers recruit 
U.S. workers before hiring H-1B nonimmigrants (as described inSec. 
655.739).
    (a) What constitutes an ``H-1B-dependent'' employer? (1) ``H-1B-
dependent employer,'' for purposes of THIS subpart H and subpart I of 
this part, means an employer that meets one of the three following 
standards, which are based on the ratio between the employer's total 
work force employed in the U.S. (including both U.S. workers and H-1B 
nonimmigrants, and measured according to full-time equivalent employees) 
and the employer's H-1B nonimmigrant employees (a ``head count'' 
including both full-time and part-time H-1B employees)--
    (i)(A) The employer has 25 or fewer full-time equivalent employees 
who are employed in the U.S.; and

[[Page 669]]

    (B) Employs more than seven H-1B nonimmigrants;
    (ii)(A) The employer has at least 26 but not more than 50 full-time 
equivalent employees who are employed in the U.S.; and
    (B) Employs more than 12 H-1B nonimmigrant; or
    (iii)(A) The employer has at least 51 full-time equivalent employees 
who are employed in the U.S.; and
    (B) Employs H-1B nonimmigrants in a number that is equal to at least 
15 percent of the number of such full-time equivalent employees.
    (2) ``Full-time equivalent employees'' (FTEs), for purposes of 
paragraph (a) of this section are to be determined according to the 
following standards:
    (i) The determination of FTEs is to include only persons employed by 
the employer (as defined inSec. 655.715), and does not include bona 
fide consultants and independent contractors. For purposes of this 
section, the Department will accept the employer's designation of 
persons as ``employees,'' provided that such persons are consistently 
treated as ``employees'' for all purposes including FICA, FLSA, etc.
    (ii) The determination of FTEs is to be based on the following 
records:
    (A) To determine the number of employees, the employer's quarterly 
tax statement (or similar document) is to be used (assuming there is no 
issue as to whether all employees are listed on the tax statement); and
    (B) To determine the number of hours of work by part-time employees, 
for purposes of aggregating such employees to FTEs, the last payroll (or 
the payrolls over the previous quarter, if the last payroll is not 
representative) is to be used, or where hours of work records are not 
maintained, other available information is to be used to make a 
reasonable approximation of hours of work (such as a standard work 
schedule). (But see paragraph (a)(2)(iii)(B)(1) of this section 
regarding the determination of FTEs for part-time employees without a 
computation of the hours worked by such employees.)
    (iii) The FTEs employed by the employer means the total of the two 
numbers yielded by paragraphs (a)(2)(iii)(A) and (B), which follow:
    (A) The number of full-time employees. A full-time employee is one 
who works 40 or more hours per week, unless the employer can show that 
less than 40 hours per week is full-time employment in its regular 
course of business (however, in no event would less than 35 hours per 
week be considered to be full-time employment). Each full-time employee 
equals one FTE (e.g., 50 full-time employees would yield 50 FTEs). (Note 
to paragraph (a)(2)(iii)(A): An employee who commonly works more than 
the number of hours constituting full-time employment cannot be counted 
as more than one FTE.); plus
    (B) The part-time employees aggregated to a number of full-time 
equivalents, if the employer has part-time employees. For purposes of 
this determination, a part-time employee is one who regularly works 
fewer than the number of hours per week which constitutes full-time 
employment (e.g., employee regularly works 20 hours, where full-time 
employment is 35 hours per week). The aggregation of part-time employees 
to FTEs may be performed by either of the following methods (i.e., 
paragraphs (a)(2)(iii)(B)(1) or (2)):
    (1) Each employee working fewer than full-time hours counted as one-
half of an FTE, with the total rounded to the next higher whole number 
(e.g., three employees working fewer than 35 hours per week, where full-
time employment is 35 hours, would yield two FTEs (i.e., 1.5 rounded to 
2)); or
    (2) The total number of hours worked by all part-time employees in 
the representative pay period, divided by the number of hours per week 
that constitute full-time employment, with the quotient rounded to the 
nearest whole number (e.g., 72 total hours of work by three part-time 
employees, divided by 40 (hours per week constituting full-time 
employment), would yield two FTEs (i.e., 1.8 rounded to 2)).
    (iv) Examples of determinations of FTEs: Employer A has 100 
employees, 70 of whom are full-time (with full-time employment shown to 
be 44 hours of work per week) and 30 of whom are part-time (with a total 
of 1004 hours of work by all 30 part-time employees during the 
representative pay period). Utilizing the method in paragraph

[[Page 670]]

(a)(2)(iii)(B)(1) of this section, this employer would have 85 FTEs: 70 
FTEs for full-time employees, plus 15 FTEs for part-time employees 
(i.e., each of the 30 part-time employees counted as one-half of a full-
time employee, as described in paragraph (a)(2)(iii)(B)(1) of this 
section). (This employer would have 23 FTEs for part-time employees, if 
these FTEs were computed as described in paragraph (a)(2)(iii)(B)(2) of 
this section: 1004 total hours of work by part-time employees, divided 
by 44 (full-time employment), yielding 22.8, rounded to 23)). Employer B 
has 100 employees, 80 of whom are full-time (with full-time employment 
shown to be 40 hours of work per week) and 20 of whom are part-time 
(with a total of 630 hours of work by all 30 part-time employees during 
the representative pay period). This employer would have 90 FTEs: 80 
FTEs for full-time employees, plus 10 FTEs for part-time employees 
(i.e., each of the 20 part-time employees counted as one-half of a full-
time employee, as described in paragraph (a)(2)(iii)(B)(1) of this 
section) (This employer would have 16 FTEs for part-time employees, if 
these FTEs were computed as described in paragraph (a)(2)(iii)(B)(2) of 
this section: 630 total hours of work by part-time employees, divided by 
40 (full-time employment), yielding 15.7, rounded to 16)).
    (b) What constitutes an ``employer'' for purposes of determining H-
1B-dependency status? Any group treated as a single employer under the 
Internal Revenue Code (IRC) at 26 U.S.C. 414(b), (c), (m) or (o) shall 
be treated as a single employer for purposes of the determination of H-
1B-dependency. Therefore, if an employer satisfies the requirements of 
the IRC and relevant regulations with respect to the following groups of 
employees, those employees will be treated as employees of a single 
employer for purposes of determining whether that employer is an H-1B-
dependent employer.
    (1) Pursuant to section 414(b) of the IRC and related regulations, 
all employees ``within a controlled group of corporations'' (within the 
meaning of section 1563(a) of the IRC, determined without regard to 
section 1563(a)(4) and (e)(3)(C)), will be treated as employees of a 
single employer. A controlled group of corporations is a parent-
subsidiary-controlled group, a brother-sister-controlled group, or a 
combined group. 26 U.S.C. 1563(a), 26 CFR 1.414(b)-1(a).
    (i) A parent-subsidiary-controlled group is one or more chains of 
corporations connected through stock ownership with a common parent 
corporation where at least 80 percent of the stock (by voting rights or 
value) of each subsidiary corporation is owned by one or more of the 
other corporations (either another subsidiary or the parent 
corporation), and the common parent corporation owns at least 80 percent 
of the stock of at least one subsidiary.
    (ii) A brother-sister-controlled group is a group of corporations in 
which five or fewer persons (individuals, estates, or trusts) own 80 
percent or more of the stock of the corporations and certain other 
ownership criteria are satisfied.
    (iii) A combined group is a group of three or more corporations, 
each of which is a member of a parent-subsidiary controlled group or a 
brother-sister-controlled group and one of which is a common parent 
corporation of a parent-subsidiary-controlled group and is also included 
in a brother-sister-controlled group.
    (2) Pursuant to section 414(c) of the IRC and related regulations, 
all employees of trades or businesses (whether or not incorporated) that 
are under common control are treated as employees of a single employer. 
26 U.S.C. 414(c), 26 CFR 1.414(c)-2.
    (i) Trades or businesses are under common control if they are 
included in:
    (A) A parent-subsidiary group of trades or businesses;
    (B) A brother-sister group of trades or businesses; or
    (C) A combined group of trades or businesses.
    (ii) Trades or businesses include sole proprietorships, 
partnerships, estates, trusts or corporations.
    (iii) The standards for determining whether trades or businesses are 
under common control are similar to standards that apply to controlled 
groups of corporations. However, pursuant to 26 CFR 1.414(c)-2(b)(2), 
ownership of at least an 80 percent interest in the profits or capital 
interest of a partnership

[[Page 671]]

or the actuarial value of a trust or estate constitutes a controlling 
interest in a trade or business.
    (3) Pursuant to section 414(m) of the IRC and related regulations, 
all employees of the members of an affiliated service group are treated 
as employees of a single employer. 26 U.S.C. 414(m).
    (i) An affiliated service group is, generally, a group consisting of 
a service organization (the ``first organization''), such as a health 
care organization, a law firm or an accounting firm, and one or more of 
the following:
    (A) A second service organization that is a shareholder or partner 
in the first organization and that regularly performs services for the 
first organization (or is regularly associated with the first 
organization in performing services for third persons); or
    (B) Any other organization if :
    (1) A significant portion of the second organization's business is 
the performance of services for the first organization (or an 
organization described in paragraph (b)(3)(i) of this section or for 
both) of a type historically performed in such service field by 
employees, and
    (2) Ten percent or more of the interest in the second organization 
is held by persons who are highly compensated employees of the first 
organization (or an organization described in paragraph (b)(3)(i) of 
this section).
    (ii) [Reserved]
    (4) Section 414(o) of the IRC provides that the Department of the 
Treasury may issue regulations addressing other business arrangements, 
including employee leasing, in which a group of employees are treated as 
employed by the same employer. However, the Department of the Treasury 
has not issued any regulations under this provision. Therefore, that 
section of the IRC will not be taken into account in determining what 
groups of employees are considered employees of a single employer for 
purposes of H-1B dependency determinations, unless regulations are 
issued by the Treasury Department during the period the dependency 
provisions of the ACWIA are effective.
    (5) The definitions of ``single employer'' set forth in paragraphs 
(b)(1) through (b)(3) of this section are established by the Internal 
Revenue Service (IRS) in regulations located at 26 CFR 1.414(b)-1(a), 
(c)-2 and (m)-5. Guidance on these definitions should be sought from 
those regulations or from the IRS.
    (c) Which employers are required to make determinations of H-1B-
dependency status? Every employer that intends to file an LCA regarding 
H-1B nonimmigrants or to file H-1B petition(s) or request(s) for 
extension(s) of H-1B status from January 19, 2001 through September 30, 
2003, and after March 7, 2005, is required to determine whether it is an 
H-1B-dependent employer or a willful violator which, except as provided 
inSec. 655.737, will be subject to the additional obligations for H-
1B-dependent employers (see paragraph (g) of this section). No H-1B-
dependent employer or willful violator may use an LCA filed before 
January 19, 2001, and during the period of October 1, 2003 through March 
7, 2005, to support a new H-1B petition or request for an extension of 
status. Furthermore, on all H-1B LCAs filed from January 19, 2001 
through September 30, 2003, and on or after March 8, 2005, an employer 
will be required to attest whether it is an H-1B-dependent employer or 
willful violator. An employer that attests it is non-H-1B-dependent but 
does not meet the ``snap shot'' test set forth in paragraph (c)(2) of 
this section shall make and document a full calculation of its status. 
However, as explained in paragraphs (c)(1) and (2) of this section, 
which follow, most employers would not be required to make any 
calculations or to create any documentation as to the determination of 
their H-1B status.
    (1) Employers with readily apparent status concerning H-1B-
dependency need not calculate that status. For most employers, 
regardless of their size, H-1B-dependency status (i.e., H-1B-dependent 
or non-H-1B-dependent) is readily apparent and would require no 
calculations, in that the ratio of H-1B employees to the total workforce 
is obvious and can easily be compared to the definition of ``H-1B-
dependency'' (see definition set out in paragraph (a)(1) of this 
section).

    For example: Employer A with 20 employees, only one of whom is an H-
1B non-immigrant, would obviously not be H-1B-dependent and would not 
need to make calculations

[[Page 672]]

to confirm that status. Employer B with 45 employees, 30 of whom are H-
1B nonimmigrants, would obviously be H-1B-dependent and would not need 
to make calculations. Employer C with 500 employees, only 30 of whom are 
H-1B nonimmigrants, would obviously not be H-1B-dependent and would not 
need to make calculations. Employer D with 1,000 employees, 850 of whom 
are H-1B nonimmigrants, would obviously be H-1B-dependent and would not 
have to make calculations.

    (2) Employers with borderline H-1B-dependency status may use a 
``snap-shot'' test to determine whether calculation of that status is 
necessary. Where an employer's H-1B-dependency status (i.e., H-1B-
dependent or non-H-1B-dependent) is not readily apparent, the employer 
may use one of the following tests to determine whether a full 
calculation of the status is needed:
    (i) Small employer (50 or fewer employees). If the employer has 50 
or fewer employees (both full-time and part-time, including H-1B 
nonimmigrants and U.S. workers), then the employer may compare the 
number of its H-1B nonimmigrant employees (both full-time and part-time) 
to the numbers specified in the definition set out in paragraph (a)(1) 
of this section, and shall fully calculate its H-1B-dependency status 
(i.e., calculate FTEs) where the number of its H-1B nonimmigrant 
employees is above the number specified in the definition. In other 
words, if the employer has 25 or fewer employees, and more than seven of 
them are H-1B nonimmigrants, then the employer shall fully calculate its 
status; if the employer has at least 26 but no more than 50 employees, 
and more than 12 of them are H-1B nonimmigrants, then the employer shall 
fully calculate its status.
    (ii) Large employer (51 or more employees). If the number of H-1B 
nonimmigrant employees (both full-time and part-time), divided by the 
number of full-time employees (including H-1B nonimmigrants and U.S. 
workers), is 0.15 or more, then an employer which believes itself to be 
non-H-1B-dependent shall fully calculate its H-1B-dependency status 
(including the calculation of FTEs). In other words, if the number of 
full-time employees (including H-1B nonimmigrants and U.S. workers) 
multiplied by 0.15 yields a number that is equal to or less than the 
number of H-1B nonimmigrant employees (both full-time and part-time), 
then the employer shall attest that it is H-1B-dependent or shall fully 
calculate its H-1B dependency status (including the calculation of 
FTEs).
    (d) What documentation is the employer required to make or maintain, 
concerning its determination of H-1B-dependency status? All employers 
are required to retain copies of H-1B petitions and requests for 
extensions of H-1B status filed with the DHS, as well as the payroll 
records described inSec. 655.731(b)(1). The nature of any additional 
documentation would depend upon the general characteristics of the 
employer's workforce, as described in paragraphs (d)(1) through (4), 
which follow.
    (1) Employer with readily apparent status concerning H-1B-
dependency. If an employer's H-1B-dependency status (i.e., H-1B-
dependent or non-H-1B-dependent) is readily apparent (as described in 
paragraph (c)(1) of this section), then that status must be reflected on 
the employer's LCA but the employer is not required to make or maintain 
any particular documentation. The public access file maintained in 
accordance withSec. 655.760 would show the H-1B-dependency status, by 
means of copy(ies) of the LCA(s). In the event of an enforcement action 
pursuant to subpart I of this part, the employer's readily apparent 
status could be verified through records to be made available to the 
Administrator (e.g., copies of H-1B petitions; payroll records described 
inSec. 655.731(b)(1)).
    (2) Employer with borderline H-1B-dependency status. An employer 
which uses a ``snap-shot'' test to determine whether it should undertake 
a calculation of its H-1B-dependency status (as described in paragraph 
(c)(2) of this section) is not required to make or maintain any 
documentation of that ``snap-shot'' test. The employer's status must be 
reflected on the LCA(s), which would be available in the public access 
file. In the event of an enforcement action pursuant to subpart I of 
this part, the employer's records to be made available to the 
Administrator would enable the employer to show and the Administrator to 
verify the ``snap-

[[Page 673]]

shot'' test (e.g., copies of H-1B petitions; payroll records described 
inSec. 655.731(b)(1)) .
    (3) Employer with H-1B-dependent status. An employer which attests 
that it is H-1B-dependent--whether that status is readily apparent or is 
determined through calculations--is not required to make or maintain any 
documentation of the calculation. The employer's status must be 
reflected on the LCA(s), which would be available in the public access 
file. In the event of an enforcement action pursuant to subpart I of 
this part, the employer's designation of H-1B-dependent status on the 
LCA(s) would be conclusive and sufficient documentation of that status 
(except where the employer's status had altered to non-H-1B-dependent 
and had been appropriately documented, as described in paragraph 
(d)(5)(ii) of this section).
    (4) Employer with non-H-1B-dependent status who is required to 
perform full calculation. An employer which attests that it is non-H-1B-
dependent and does not meet the ``snap shot'' test set forth in 
paragraph (c)(2) of this section shall retain in its records a dated 
copy of its calculation that it is not H-1B-dependent. In the event of 
an enforcement action pursuant to subpart I of this part, the employer's 
records to be made available to the Administrator would enable the 
employer to show and the Administrator to verify the employer's 
determination (e.g., copies of H-1B petitions; payroll records described 
inSec. 655.731(b)(1)).
    (5) Employer which changes its H-1B-dependency status due to changes 
in workforce. An employer may experience a change in its H-1B-dependency 
status, due to changes in the ratio of H-1B nonimmigrant to U.S. workers 
in its workforce. Thus it is important that employers who wish to file a 
new LCA or a new H-1B petition or request for extension of status remain 
cognizant of their dependency status and do a recheck of such status if 
the make-up of their workforce changes sufficiently that their 
dependency status might possibly change. In the event of such a change 
of status, the following standards will apply:
    (i) Change from non-H-1B-dependent to H-1B-dependent. An employer 
which experiences this change in its workforce is not required to make 
or maintain any record of its determination of the change of its H-1B-
dependency status. The employer is not required to file new LCA(s) 
(which would accurately state its H-1B-dependent status), unless it 
seeks to hire new H-1B nonimmigrants or extend the status of existing H-
1B nonimmigrants (see paragraph (g) of this section).
    (ii) Change from H-1B-dependent to non-H-1B-dependent. An employer 
which experiences this change in its workforce is required to perform a 
full calculation of its status (as described in paragraph (c) of this 
section) and to retain a copy of such calculation in its records. If the 
employer seeks to hire new H-1B nonimmigrants or extend the status of 
existing H-1B nonimmigrants (see paragraph (g) of this section), the 
employer shall either file new LCAs reflecting its non-H-1B-dependent 
status or use its existing certified LCAs reflecting an H-1B-dependency 
status, in which case it shall continue to be bound by the dependent-
employer attestations on such LCAs. In the event of an enforcement 
action pursuant to subpart I of this part, the employer's records to be 
made available to the Administrator would enable the employer to show 
and the Administrator to verify the employer's determination (e.g., 
copies of H-1B petitions; payroll records described inSec. 
655.731(b)(1)).
    (6) Change in corporate structure or identity of employer. If an 
employer which experiences a change in its corporate structure as the 
result of an acquisition, merger, ``spin-off,'' or other such action 
wishes to file a new LCA or a new H-1B petition or request for extension 
of status, the new employing entity shall redetermine its H-1B-
dependency status in accordance with paragraphs (a) and (c) of this 
section (see paragraph (g) of this section). (SeeSec. 655.730(e), 
regarding change in corporate structure or identity of employer.) In the 
event of an enforcement action pursuant to subpart I of this part, the 
employer's calculations where required under paragraph (c) of this 
section and its records to be made available to the Administrator would 
enable the employer to show and the Administrator to verify the 
employer's

[[Page 674]]

determination (e.g., copies of H-1B petitions; payroll records described 
inSec. 655.731(b)(1)).
    (7) ``Single employer'' under IRC test. If an employer utilizes the 
IRC single-employer definition and concludes that it is non-H-1B-
dependent, the employer shall perform the ``snap-shot'' test set forth 
in paragraph (c)(2) of this section, and if it fails to meet that test, 
shall attest that it is H-1B-dependent or shall perform the full 
calculation of dependency status in accordance with paragraph (a) of 
this section. The employer shall place a list of the entities included 
as a ``single employer'' in the public access file maintained in 
accordance withSec. 766.760. In addition, the employer shall retain in 
its records the ``snap-shot'' or full calculation of its status, as 
appropriate (showing the number of employees of each entity who are 
included in the numerator and denominator of the equation, whether the 
employer utilizes the ``snap shot'' test or a complete calculation as 
described in paragraph (c) of this section). In the event of an 
enforcement action pursuant to subpart I of this part, the employer's 
records to be made available to the Administrator would enable the 
employer to show and the Administrator to verify the employer's 
determination (e.g., copies of H-1B petitions; payroll records described 
inSec. 655.731(b)(1)).
    (e) How is an employer's H-1B-dependency status to be shown on the 
LCA? The employer is required to designate its status by marking the 
appropriate box on the Form ETA-9035 or 9035E (i.e., either H-1B-
dependent or non-H-1B-dependent). An employer which marks the 
designation of ``H-1B-dependent'' may also mark the designation of its 
intention to seek only ``exempt'' H-1B nonimmigrants on the LCA (see 
paragraph (g) of this section, andSec. 655.737). In the event that an 
employer has filed an LCA designating its H-1B-dependency status (either 
H-1B-dependent or non-H-1B-dependent) and thereafter experiences a 
change of status, the employer cannot use that LCA to support H-1B 
petitions for new nonimmigrants or requests for extension of H-1B status 
for existing nonimmigrants. Similarly, an employer that is or becomes H-
1B-dependent cannot continue to use an LCA filed before January 19, 2001 
to support new H-1B petitions or requests for extension of status. In 
such circumstances, the employer shall file a new LCA accurately 
designating its status and shall use that new LCA to support new 
petitions or requests for extensions of status.
    (f) What constitutes a ``willful violator'' employer and what are 
its special obligations?
    (1) ``Willful violator'' or ``willful violator employer,'' for 
purposes of this subpart H and subpart I of this part means an employer 
that meets all of the following standards (i.e., paragraphs (f)(1)(i) 
through (iii))--
    (i) A finding of violation by the employer (as described in 
paragraph (f)(1) (ii)) is entered in either of the following two types 
of enforcement proceeding:
    (A) A Department of Labor proceeding under section 212(n)(2) of the 
Act (8 U.S.C. 1182(n)(2)(C) and subpart I of this part; or
    (B) A Department of Justice proceeding under section 212(n)(5) of 
the Act (8 U.S.C. 1182(n)(5).
    (ii) The agency finds that the employer has committed either a 
willful failure or a misrepresentation of a material fact during the 
five-year period preceding the filing of the LCA; and
    (iii) The agency's finding is entered on or after October 21, 1998.
    (2) For purposes of this paragraph, ``willful failure'' means a 
violation which is a ``willful failure'' as defined inSec. 655.805(c).
    (g) What LCAs are subject to the additional attestation obligations? 
(1) An employer that is ``H-1B-dependent'' (under the standards 
described in paragraphs (a) through (e) of this section) or is a 
``willful violator'' (under the standards described in paragraph (f) of 
this section) is subject to the attestation obligations regarding 
displacement of U.S. workers and recruitment of U.S. workers (under the 
standards described in Sec.Sec. 655.738 and 655.739, respectively) for 
all LCAs that are filed during the time period specified in paragraph 
(g)(2) of this section, to be used to support any petitions for new H-1B 
nonimmigrants or any requests for extensions of status for existing H-1B 
nonimmigrants. An

[[Page 675]]

LCA which does not accurately indicate the employer's H-1B-dependency 
status or willful violator status shall not be used to support H-1B 
petitions or requests for extensions. Further, an employer which falsely 
attests to non-H-1B-dependency status, or which experiences a change of 
status to H-1B-dependency but continues to use the LCA to support new H-
1B petitions or requests for extension of status shall--despite the LCA 
designation of non-H-1B-dependency--be held to its obligations to comply 
with the attestation requirements concerning nondisplacement of U.S. 
workers and recruitment of U.S. workers (as described in Sec.Sec. 
655.738 and 655.739, respectively), as explicitly acknowledged and 
agreed on the LCA.
    (2) During the period between January 19, 2001 through September 30, 
2003, and on or after March 8, 2005, any employer that is ``H-1B-
dependent'' (under the standards described in paragraphs (a) through (e) 
of this section) or is a ``willful violator'' (under the standards 
described in paragraph (f) of this section) shall file a new LCA 
accurately indicating that status in order to be able to file 
petition(s) for new H-1B nonimmigrant(s) or request(s) for extension(s) 
of status for existing H-1B nonimmigrant(s). An LCA filed during a 
period when the special attestation obligations for H-1B dependent 
employers and willful violators were not in effect (that is before 
January 19, 2001, and from October 1, 2003 through March 7, 2005) may 
not be used by an H-1B dependent employer or willful violator to support 
petition(s) for new H-1B nonimmigrant(s) or request(s) for extension(s) 
of status for existing H-1B nonimmigrants.
    (3) An employer that files an LCA indicating ``H-1B-dependent'' and/
or ``willful violator'' status may also indicate on the LCA that all the 
H-1B nonimmigrants to be employed pursuant to that LCA will be ``exempt 
H-1B nonimmigrants'' as described inSec. 655.737. Such an LCA is not 
subject to the additional LCA attestation obligations, provided that all 
H-1B nonimmigrants employed under it are, in fact, exempt. An LCA which 
indicates that it will be used only for exempt H-1B nonimmigrants shall 
not be used to support H-1B petitions or requests for extensions of 
status for H-1B nonimmigrants who are not, in fact, exempt. Further, an 
employer which attests that the LCA will be used only for exempt H-1B 
nonimmigrants but uses the LCA to employ non-exempt H-1B nonimmigrants 
(through petitions and/or extensions of status) shall--despite the LCA 
designation of exempt H-1B nonimmigrants--be held to its obligations to 
comply with the attestation requirements concerning nondisplacement of 
U.S. workers and recruitment of U.S. workers (as described in Sec.Sec. 
655.738 and 655.739, respectively), as explicitly acknowledged and 
agreed on the LCA.
    (4) The special provisions for H-1B-dependent employers and willful 
violator employers do not apply to LCAs filed from October 1, 2003 
through March 7, 2005, or before January 19, 2001. However, all LCAs 
filed before October 1, 2003, and containing the additional attestation 
obligations described in this section and Sec.Sec. 655.737 through 
655.739, will remain in effect with regard to those obligations, for so 
long as any H-1B nonimmigrant(s) employed pursuant to the LCA(s) remain 
employed by the employer.

[65 FR 80223, Dec. 20, 2000; 66 FR 1375, Jan. 8, 2001, as amended at 66 
FR 63302, Dec. 5, 2001; 70 FR 72563, Dec. 5, 2005]



Sec.  655.737  What are ``exempt'' H-1B nonimmigrants, and how does
their employment affect the additional attestation obligations of
H-1B-dependent employers and willful violator employers?

    (a) An employer that is H-1B-dependent or a willful violator of the 
H-1B program requirements (as described inSec. 655.736) is subject to 
the attestation obligations regarding displacement of U.S. workers and 
recruitment of U.S. workers (as described in Sec.Sec. 655.738 and 
655.739, respectively) for all LCAs that are filed during the time 
period specified inSec. 655.736(g). However, these additional 
obligations do not apply to an LCA filed by such an employer if the LCA 
is used only for the employment of ``exempt'' H-1B nonimmigrants 
(through petitions and/or extensions of status) as described in this 
section.

[[Page 676]]

    (b) What is the test or standard for determining an H-1B 
nonimmigrant's ``exempt'' status? An H-1B nonimmigrant is ``exempt'' for 
purposes of this section if the nonimmigrant meets either of the two 
following criteria:
    (1) Receives wages (including cash bonuses and similar compensation) 
at an annual rate equal to at least $60,000; or
    (2) Has attained a master's or higher degree (or its equivalent) in 
a specialty related to the intended employment.
    (c) How is the $60,000 annual wage to be determined? The H-1B 
nonimmigrant can be considered to be an ``exempt'' worker, for purposes 
of this section, if the nonimmigrant actually receives hourly wages or 
annual salary totaling at least $60,000 in the calendar year. The 
standards applicable to the employer's satisfaction of the required wage 
obligation are applicable to the determination of whether the $60,000 
wages or salary are received (seeSec. 655.731(c)(2) and (3)). Thus, 
employer contributions or costs for benefits such as health insurance, 
life insurance, and pension plans cannot be counted toward this $60,000. 
The compensation to be counted or credited for these purposes could 
include cash bonuses and similar payments, provided that such 
compensation is paid to the worker ``cash in hand, free and clear, when 
due'' (Sec.  655.731(c)(1)), meaning that the compensation has readily 
determinable market value, is readily convertible to cash tender, and is 
actually received by the employee when due (which must be within the 
year for which the employer seeks to count or credit the compensation 
toward the employee's $60,000 earnings to qualify for exempt status). 
Cash bonuses and similar compensation can be counted or credited toward 
the $60,000 for ``exempt'' status only if payment is assured (i.e., if 
the payment is contingent or conditional on some event such as the 
employer's annual profits, the employer must guarantee payment even if 
the contingency is not met). The full $60,000 annual wages or salary 
must be received by the employee in order for the employee to have 
``exempt'' status. The wages or salary required for ``exempt'' status 
cannot be decreased or pro rated based on the employee's part-time work 
schedule; an H-1B nonimmigrant working part-time, whose actual annual 
compensation is less than $60,000, would not qualify as exempt on the 
basis of wages, even if the worker's earnings, if projected to a full-
time work schedule, would theoretically exceed $60,000 in a year. Where 
an employee works for less than a full year, the employee must receive 
at least the appropriate pro rata share of the $60,000 in order to be 
``exempt'' (e.g., an employee who resigns after three months must be 
paid at least $15,000). In the event of an investigation pursuant to 
subpart I of this part, the Administrator will determine whether the 
employee has received the required $60,000 per year, using the 
employee's anniversary date to determine the one-year period; for an 
employee who had worked for less than a full year (either at the 
beginning of employment, or after his/her last anniversary date), the 
determination as to the $60,000 annual wages will be on a pro rata basis 
(i.e., whether the employee had been paid at a rate of $60,000 per year 
(or $5,000 per month) including any unpaid, guaranteed bonuses or 
similar compensation).
    (d) How is the ``master's or higher degree (or its equivalent) in a 
specialty related to the intended employment'' to be determined? (1) 
``Master's or higher degree (or its equivalent),'' for purposes of this 
section means a foreign academic degree from an institution which is 
accredited or recognized under the law of the country where the degree 
was obtained, and which is equivalent to a master's or higher degree 
issued by a U.S. academic institution. The equivalence to a U.S. 
academic degree cannot be established through experience or through 
demonstration of expertise in the academic specialty (i.e., no ``time 
equivalency'' or ``performance equivalency'' will be recognized as 
substituting for a degree issued by an academic institution). The DHS 
and the Department will consult appropriate sources of expertise in 
making the determination of equivalency between foreign and U.S. 
academic degrees. Upon the request of the DHS or the Department, the 
employer shall provide evidence to establish that the H-1B nonimmigrant 
has received the degree, that the degree was earned in

[[Page 677]]

the asserted field of study, including an academic transcript of 
courses, and that the institution from which the degree was obtained was 
accredited or recognized.
    (2) ``Specialty related to the intended employment,'' for purposes 
of this section, means that the academic degree is in a specialty which 
is generally accepted in the industry or occupation as an appropriate or 
necessary credential or skill for the person who undertakes the 
employment in question. A ``specialty'' which is not generally accepted 
as appropriate or necessary to the employment would not be considered to 
be sufficiently ``related' to afford the H-1B nonimmigrant status as an 
``exempt H-1B nonimmigrant.''
    (e) When and how is the determination of the H-1B nonimmigrant's 
``exempt'' status to be made? An employer that is H-1B-dependent or a 
willful violator (as described inSec. 655.736) may designate on the 
LCA that the LCA will be used only to support H-1B petition(s) and/or 
request(s) for extension of status for ``exempt'' H-1B nonimmigrants.
    (1) If the employer makes the designation of ``exempt'' H-1B 
nonimmigrant(s) on the LCA, then the DHS--as part of the adjudication of 
the H-1B petition or request for extension of status--will determine the 
worker's ``exempt'' status, since an H-1B petition must be supported by 
an LCA consistent with the petition (i.e., occupation, area of intended 
employment, exempt status). The employer shall maintain, in the public 
access file maintained in accordance withSec. 755.760, a list of the 
H-1B nonimmigrant(s) whose petition(s) and/or request(s) are supported 
by LCA(s) which the employer has attested will be used only for exempt 
H-1B nonimmigrants. In the event of an investigation under subpart I of 
this part, the Administrator will give conclusive effect to an DHS 
determination of ``exempt'' status based on the nonimmigrant's 
educational attainments (i.e., master's or higher degree (or its 
equivalent) in a specialty related to the intended employment) unless 
the determination was based on false information. If the DHS 
determination of ``exempt'' status was based on the assertion that the 
nonimmigrant would receive wages (including cash bonuses and similar 
compensation) at an annual rate equal to at least $60,000, the employer 
shall provide evidence to show that such wages actually were received by 
the nonimmigrant (consistent with paragraph (c) of this section and the 
regulatory standards for satisfaction or payment of the required wages 
as described inSec. 655.731(c)(3)).
    (2) If the employer makes the designation of ``exempt'' H-1B 
nonimmigrants on the LCA, but is found in an enforcement action under 
subpart I of this part to have used the LCA to employ nonimmigrants who 
are, in fact, not exempt, then the employer will be subject to a finding 
that it failed to comply with the nondisplacement and recruitment 
obligations (as described in Sec.Sec. 655.738 and 655.739, 
respectively) and may be assessed appropriate penalties and remedies.
    (3) If the employer does not make the designation of ``exempt'' H-1B 
nonimmigrants on the LCA, then the employer has waived the option of not 
being subject to the additional LCA attestation obligations on the basis 
of employing only exempt H-1B nonimmigrants under the LCA. In the event 
of an investigation under subpart I of this part, the Administrator will 
not consider the question of the nonimmigrant(s)'s ``exempt'' status in 
determining whether an H-1B-dependent employer or willful violator 
employer has complied with such additional LCA attestation obligations.

[65 FR 80227, Dec. 20, 2000]



Sec.  655.738  What are the ``non-displacement of U.S. workers'' 
obligations that apply to H-1B-dependent employers and willful 
violators, and how do they operate?

    An employer that is subject to these additional attestation 
obligations (under the standards described inSec. 655.736) is 
prohibited from displacement of any U.S. worker(s)--whether directly (in 
its own workforce) or secondarily (at a worksite of a second employer)--
under the standards set out in this section.
    (a) United States worker (U.S. worker) is defined inSec. 655.715.
    (b) Displacement, for purposes of this section, has two components: 
``lay off''

[[Page 678]]

of U.S. worker(s), and ``essentially equivalent jobs'' held by U.S. 
worker(s) and H-1B nonimmigrant(s).
    (1) Lay off of a U.S. worker means that the employer has caused the 
worker's loss of employment, other than through--
    (i) Discharge of a U.S. worker for inadequate performance, violation 
of workplace rules, or other cause related to the worker's performance 
or behavior on the job;
    (ii) A U.S. worker's voluntary departure or voluntary retirement (to 
be assessed in light of the totality of the circumstances, under 
established principles concerning ``constructive discharge'' of workers 
who are pressured to leave employment);
    (iii) Expiration of a grant or contract under which a U.S. worker is 
employed, other than a temporary employment contract entered into in 
order to evade the employer's non-displacement obligation. The question 
is whether the loss of the contract or grant has caused the worker's 
loss of employment. It would not be a layoff where the job loss results 
from the expiration of a grant or contract without which there is no 
alternative funding or need for the U.S. worker's position on that or 
any other grant or contract (e.g., the expiration of a research grant 
that funded a project on which the worker was employed at an academic or 
research institution; the expiration of a staffing firm's contract with 
a customer where the U.S. worker was hired expressly to work pursuant to 
that contract and the employer has no practice of moving workers to 
other customers or projects upon the expiration of contract(s)). On the 
other hand, it would be a layoff where the employer's normal practice is 
to move the U.S. worker from one contract to another when a contract 
expires, and work on another contract for which the worker is qualified 
is available (e.g., staffing firm's contract with one customer ends and 
another contract with a different customer begins); or
    (iv) A U.S. worker who loses employment is offered, as an 
alternative to such loss, a similar employment opportunity with the same 
employer (or, in the case of secondary displacement at a worksite of a 
second employer, as described in paragraph (d) of this section, a 
similar employment opportunity with either employer) at equivalent or 
higher compensation and benefits than the position from which the U.S. 
worker was discharged, regardless of whether or not the U.S. worker 
accepts the offer. The validity of the offer of a similar employment 
opportunity will be assessed in light of the following factors:
    (A) The offer is a bona fide offer, rather than an offer designed to 
induce the U.S. worker to refuse or an offer made with the expectation 
that the worker will refuse;
    (B) The offered job provides the U.S. worker an opportunity similar 
to that provided in the job from which he/she is discharged, in terms 
such as a similar level of authority, discretion, and responsibility, a 
similar opportunity for advancement within the organization, and similar 
tenure and work scheduling;
    (C) The offered job provides the U.S. worker equivalent or higher 
compensation and benefits to those provided in the job from which he/she 
is discharged. The comparison of compensation and benefits includes all 
forms of remuneration for employment, whether or not called wages and 
irrespective of the time of payment (e.g., salary or hourly wage rate; 
profit sharing; retirement plan; expense account; use of company car). 
The comparison also includes such matters as cost of living 
differentials and relocation expenses (e.g., a New York City 
``opportunity'' at equivalent or higher compensation and benefits 
offered to a worker discharged from a job in Kansas City would provide a 
wage adjustment from the Kansas City pay scale and would include 
relocation costs).
    (2) Essentially equivalent jobs. For purposes of the displacement 
prohibition, the job from which the U.S. worker is laid off must be 
essentially equivalent to the job for which an H-1B nonimmigrant is 
sought. To determine whether the jobs of the laid off U.S. worker(s) and 
the H-1B nonimmigrant(s) are essentially equivalent, the comparison(s) 
shall be on a one-to-one basis where appropriate (i.e., one U.S. worker 
left employment and one H-1B nonimmigrant joined the

[[Page 679]]

workforce) but shall be broader in focus where appropriate (e.g., an 
employer, through reorganization, eliminates an entire department with 
several U.S. workers and then staffs this department's function(s) with 
H-1B nonimmigrants). The following comparisons are to be made:
    (i) Job responsibilities. The job of the H-1B nonimmigrant must 
involve essentially the same duties and responsibilities as the job from 
which the U.S. worker was laid off. The comparison focuses on the core 
elements of and competencies for the job, such as supervisory duties, or 
design and engineering functions, or budget and financial 
accountability. Peripheral, non-essential duties that could be tailored 
to the particular abilities of the individual workers would not be 
determinative in this comparison. The job responsibilities must be 
similar and both workers capable of performing those duties.
    (ii) Qualifications and experience of the workers. The 
qualifications of the laid off U.S. worker must be substantially 
equivalent to the qualifications of the H-1B nonimmigrant. The 
comparison is to be confined to the experience and qualifications (e.g., 
training, education, ability) of the workers which are directly relevant 
to the actual performance requirements of the job, including the 
experience and qualifications that would materially affect a worker's 
relative ability to perform the job better or more efficiently. While it 
would be appropriate to compare whether the workers in question have 
``substantially equivalent'' qualifications and experience, the workers 
need not have identical qualifications and experience (e.g., a 
bachelor's degree from one accredited university would be considered to 
be substantially equivalent to a bachelor's degree from another 
accredited university; 15 years experience in an occupation would be 
substantially equivalent to 10 years experience in that occupation). It 
would not be appropriate to compare the workers' relative ages, their 
sexes, or their ethnic or religious identities.
    (iii) Area of employment. The job of the H-1B nonimmigrant must be 
located in the same area of employment as the job from which the U.S. 
worker was laid off. The comparison of the locations of the jobs is 
confined to the area within normal commuting distance of the worksite or 
physical location where the work of the H-1B nonimmigrant is or will be 
performed. For purposes of this comparison, if both such worksites or 
locations are within a Metropolitan Statistical Area or a Primary 
Metropolitan Statistical Area, they will be deemed to be within the same 
area of employment.
    (3) The worker's rights under a collective bargaining agreement or 
other employment contract are not affected by the employer's LCA 
obligations as to non-displacement of such worker.
    (c) Direct displacement. An H-1B-dependent or willful-violator 
employer (as described inSec. 655.736) is prohibited from displacing a 
U.S. worker in its own workforce (i.e., a U.S. worker ``employed by the 
employer'') within the period beginning 90 days before and ending 90 
days after the filing date of an H-1B petition supported by an LCA 
described inSec. 655.736(g). The following standards and guidance 
apply under the direct displacement prohibition:
    (1) Which U.S. workers are protected against ``direct 
displacement''? This prohibition covers the H-1B employer's own 
workforce--U.S. workers ``employed by the employer''--who are employed 
in jobs that are essentially equivalent to the jobs for which the H-1B 
nonimmigrant(s) are sought (as described in paragraph (b)(2) of this 
section). The term ``employed by the employer'' is defined inSec. 
655.715.
    (2) When does the ``direct displacement'' prohibition apply? The H-
1B employer is prohibited from displacing a U.S. worker during a 
specific period of time before and after the date on which the employer 
files any H-1B petition supported by the LCA which is subject to the 
non-displacement obligation (as described inSec. 655.736(g)). This 
protected period is from 90 days before until 90 days after the petition 
filing date.
    (3) What constitutes displacement of a U.S. worker? The H-1B 
employer is prohibited from laying off a U.S. worker from a job that is 
essentially the equivalent of the job for which an H-1B nonimmigrant is 
sought (as described in paragraph (b)(1) of this section).

[[Page 680]]

    (d) Secondary displacement. An H-1B-dependent or willful-violator 
employer (as described inSec. 655.736) is prohibited from placing 
certain H-1B nonimmigrant(s) with another employer where there are 
indicia of an employment relationship between the nonimmigrant and that 
other employer (thus possibly affecting the jobs of U.S. workers 
employed by that other employer), unless and until the H-1B employer 
makes certain inquiries and/or has certain information concerning that 
other employer's displacement of similarly employed U.S. workers in its 
workforce. Employers are cautioned that even if the required inquiry of 
the secondary employer is made, the H-1B-dependent or willful violator 
employer shall be subject to a finding of a violation of the secondary 
displacement prohibition if the secondary employer, in fact, displaces 
any U.S. worker(s) during the applicable time period (seeSec. 
655.810(d)). The following standards and guidance apply under the 
secondary displacement prohibition:
    (1) Which U.S. workers are protected against ``secondary 
displacement''? This provision applies to U.S. workers employed by the 
other or ``secondary'' employer (not those employed by the H-1B 
employer) in jobs that are essentially equivalent to the jobs for which 
certain H-1B nonimmigrants are placed with the other/secondary employer 
(as described in paragraph (b)(2) of this section). The term ``employed 
by the employer'' is defined inSec. 655.715.
    (2) Which H-1B nonimmigrants activate the secondary displacement 
prohibition? Not every placement of an H-1B nonimmigrant with another 
employer will activate the prohibition and--depending upon the 
particular facts--an H-1B employer (such as a service provider) may be 
able to place H-1B nonimmigrant(s) at a client or customer's worksite 
without being subject to the prohibition. The prohibition applies to the 
placement of an H-1B nonimmigrant whose H-1B petition is supported by an 
LCA described inSec. 655.736(g) and whose placement with the other/
secondary employer meets both of the following criteria:
    (i) The nonimmigrant performs duties in whole or in part at one or 
more worksites owned, operated, or controlled by the other/secondary 
employer; and
    (ii) There are indicia of an employment relationship between the 
nonimmigrant and the other/secondary employer. The relationship between 
the H-1B-nonimmigrant and the other/secondary need not constitute an 
``employment'' relationship (as defined inSec. 655.715), and the 
applicability of the secondary displacement provision does not establish 
such a relationship. Relevant indicia of an employment relationship 
include:
    (A) The other/secondary employer has the right to control when, 
where, and how the nonimmigrant performs the job (the presence of this 
indicia would suggest that the relationship between the nonimmigrant and 
the other/secondary employer approaches the relationship which triggers 
the secondary displacement provision);
    (B) The other/secondary employer furnishes the tools, materials, and 
equipment;
    (C) The work is performed on the premises of the other/secondary 
employer (this indicia alone would not trigger the secondary 
displacement provision);
    (D) There is a continuing relationship between the nonimmigrant and 
the other/secondary employer;
    (E) The other/secondary employer has the right to assign additional 
projects to the nonimmigrant;
    (F) The other/secondary employer sets the hours of work and the 
duration of the job;
    (G) The work performed by the nonimmigrant is part of the regular 
business (including governmental, educational, and non-profit 
operations) of the other/secondary employer;
    (H) The other/secondary employer is itself in business; and
    (I) The other/secondary employer can discharge the nonimmigrant from 
providing services.
    (3) What other/secondary employers are included in the prohibition 
on secondary displacement of U.S. workers by the H-1B employer? The 
other/secondary employer who accepts the placement and/or services of 
the H-1B employer's nonimmigrant employee(s) need not be an H-1B 
employer. The other/secondary employer would often be (but is not

[[Page 681]]

limited to) the client or customer of an H-1B employer that is a 
staffing firm or a service provider which offers the services of H-1B 
nonimmigrants under a contract (e.g., a medical staffing firm under 
contract with a nursing home provides H-1B nonimmigrant physical 
therapists; an information technology staffing firm under contract with 
a bank provides H-1B nonimmigrant computer engineers). Only the H-1B 
employer placing the nonimmigrant with the secondary employer is subject 
to the non-displacement obligation on the LCA, and only that employer is 
liable in an enforcement action pursuant to subpart I of this part if 
the other/secondary employer, in fact, displaces any of its U.S. 
worker(s) during the applicable time period. The other/secondary 
employer will not be subject to sanctions in an enforcement action 
pursuant to subpart I of this part (except in circumstances where such 
other/secondary employer is, in fact, an H-1B employer and is found to 
have failed to comply with its own obligations). (Note to paragraph 
(d)(3): Where the other/secondary employer's relationship to the H-1B 
nonimmigrant constitutes ``employment'' for purposes of a statute other 
than the H-1B provision of the INA, such as the Fair Labor Standards Act 
(29 U.S.C. 201 et seq.), the other/secondary employer would be subject 
to all obligations of an employer of the nonimmigrant under such other 
statute.)
    (4) When does the ``secondary displacement'' prohibition apply? The 
H-1B employer's obligation of inquiry concerns the actions of the other/
secondary employer during the specific period beginning 90 days before 
and ending 90 days after the date of the placement of the H-1B 
nonimmigrant(s) with such other/secondary employer.
    (5) What are the H-1B employer's obligations concerning inquiry and/
or information as to the other/secondary employer's displacement of U.S. 
workers? The H-1B employer is prohibited from placing the H-1B 
nonimmigrant with another employer, unless the H-1B employer has 
inquired of the other/secondary employer as to whether, and has no 
knowledge that, within the period beginning 90 days before and ending 90 
days after the date of such placement, the other/secondary employer has 
displaced or intends to displace a similarly-employed U.S. worker 
employed by such other/secondary employer. The following standards and 
guidance apply to the H-1B employer's obligation:
    (i) The H-1B employer is required to exercise due diligence and to 
make a reasonable effort to enquire about potential secondary 
displacement, through methods which may include (but are not limited 
to)--
    (A) Securing and retaining a written assurance from the other/
secondary employer that it has not and does not intend to displace a 
similarly-employed U.S. worker within the prescribed period;
    (B) Preparing and retaining a memorandum to the file, prepared at 
the same time or promptly after receiving the other/secondary employer's 
oral statement that it has not and does not intend to displace a 
similarly-employed U.S. worker within the prescribed period (such 
memorandum shall include the substance of the conversation, the date of 
the communication, and the names of the individuals who participated in 
the conversation, including the person(s) who made the inquiry on behalf 
of the H-1B employer and made the statement on behalf of the other/
secondary employer); or
    (C) including a secondary displacement clause in the contract 
between the H-1B employer and the other/secondary employer, whereby the 
other/secondary employer would agree that it has not and will not 
displace similarly-employed U.S. workers within the prescribed period.
    (ii) The employer's exercise of due diligence may require further, 
more particularized inquiry of the other/secondary employer in 
circumstances where there is information which indicates that U.S. 
worker(s) have been or will be displaced (e.g., where the H-1B 
nonimmigrants will be performing functions that the other/secondary 
employer performed with its own workforce in the past). The employer is 
not permitted to disregard information which would provide knowledge 
about potential secondary displacement (e.g., newspaper reports of 
relevant lay-offs by the other/secondary employer) if

[[Page 682]]

such information becomes available before the H-1B employer's placement 
of H-1B nonimmigrants with such employer. Under such circumstances, the 
H-1B employer would be expected to recontact the other/secondary 
employer and receive credible assurances that no lay-offs of similarly-
employed U.S. workers are planned or have occurred within the prescribed 
period.
    (e) What documentation is required of H-1B employers concerning the 
non-displacement obligation? The H-1B employer is responsible for 
demonstrating its compliance with the non-displacement obligation 
(whether direct or indirect), if applicable.
    (1) Concerning direct displacement (as described in paragraph (c) of 
this section), the employer is required to retain all records the 
employer creates or receives concerning the circumstances under which 
each U.S. worker, in the same locality and same occupation as any H-1B 
nonimmigrant(s) hired, left its employ in the period from 90 days before 
to 90 days after the filing date of the employer's petition for the H-1B 
nonimmigrant(s), and for any such U.S. worker(s) for whom the employer 
has taken any action during the period from 90 days before to 90 days 
after the filing date of the H-1B petition to cause the U.S. worker's 
termination (e.g., a notice of future termination of the employee's 
job). For all such employees, the H-1B employer shall retain at least 
the following documents: the employee's name, last-known mailing 
address, occupational title and job description; any documentation 
concerning the employee's experience and qualifications, and principal 
assignments; all documents concerning the departure of such employees, 
such as notification by the employer of termination of employment 
prepared by the employer or the employee and any responses thereto, and 
evaluations of the employee's job performance. Finally, the employer is 
required to maintain a record of the terms of any offers of similar 
employment to such U.S. workers and the employee's response thereto.
    (2) Concerning secondary displacement (as described in paragraph (d) 
of this section), the H-1B employer is required to maintain 
documentation to show the manner in which it satisfied its obligation to 
make inquiries as to the displacement of U.S. workers by the other/
secondary employer with which the H-1B employer places any H-1B 
nonimmigrants (as described in paragraph (d)(5) of this section).

[65 FR 80228, Dec. 20, 2000]



Sec.  655.739  What is the ``recruitment of U.S. workers'' obligation
that applies to H-1B-dependent employers and willful violators,
and how does it operate?

    An employer that is subject to this additional attestation 
obligation (under the standards described inSec. 655.736) is 
required--prior to filing the LCA or any petition or request for 
extension of status supported by the LCA--to take good faith steps to 
recruit U. S. workers in the United States for the job(s) in the United 
States for which the H-1B nonimmigrant(s) is/are sought. The recruitment 
shall use procedures that meet industry-wide standards and offer 
compensation that is at least as great as the required wage to be paid 
to H-1B nonimmigrants pursuant toSec. 655.731(a) (i.e., the higher of 
the local prevailing wage or the employer's actual wage). The employer 
may use legitimate selection criteria relevant to the job that are 
normal or customary to the type of job involved, so long as such 
criteria are not applied in a discriminatory manner. This section 
provides guidance for the employer's compliance with the recruitment 
obligation.
    (a) ``United States worker'' (``U.S. worker'') is defined inSec. 
655.715.
    (b) ``Industry,'' for purposes of this section, means the set of 
employers which primarily compete for the same types of workers as those 
who are the subjects of the H-1B petitions to be filed pursuant to the 
LCA. Thus, a hospital, university, or computer software development firm 
is to use the recruitment standards utilized by the health care, 
academic, or information technology industries, respectively, in hiring 
workers in the occupations in question. Similarly, a staffing firm, 
which places its workers at job sites of other employers, is to use the 
recruitment standards of the industry which primarily employs such 
workers (e.g., the

[[Page 683]]

health care industry, if the staffing firm is placing physical 
therapists (whether in hospitals, nursing homes, or private homes); the 
information technology industry, if the staffing firm is placing 
computer programmers, software engineers, or other such workers).
    (c) ``Recruitment,'' for purposes of this section, means the process 
by which an employer seeks to contact or to attract the attention of 
person(s) who may apply for employment, solicits applications from 
person(s) for employment, receives applications, and reviews and 
considers applications so as to present the appropriate candidates to 
the official(s) who make(s) the hiring decision(s) (i.e., pre-selection 
treatment of applications and applicants).
    (d) ``Solicitation methods,'' for purposes of this section, means 
the techniques by which an employer seeks to contact or to attract the 
attention of potential applicants for employment, and to solicit 
applications from person(s) for employment.
    (1) Solicitation methods may be either external or internal to the 
employer's workforce (with internal solicitation to include current and 
former employees).
    (2) Solicitation methods may be either active (where an employer 
takes positive, proactive steps to identify potential applicants and to 
get information about its job openings into the hands of such person(s)) 
or passive (where potential applicants find their way to an employer's 
job announcements).
    (i) Active solicitation methods include direct communication to 
incumbent workers in the employer's operation and to workers previously 
employed in the employer's operation and elsewhere in the industry; 
providing training to incumbent workers in the employer's organization; 
contact and outreach through collective bargaining organizations, trade 
associations and professional associations; participation in job fairs 
(including at minority-serving institutions, community/junior colleges, 
and vocational/technical colleges); use of placement services of 
colleges, universities, community/junior colleges, and business/trade 
schools; use of public and/or private employment agencies, referral 
agencies, or recruitment agencies (``headhunters'').
    (ii) Passive solicitation methods include advertising in general 
distribution publications, trade or professional journals, or special 
interest publications (e.g., student-oriented; targeted to 
underrepresented groups, including minorities, persons with 
disabilities, and residents of rural areas); America's Job Bank or other 
Internet sites advertising job vacancies; notices at the employer's 
worksite(s) and/or on the employer's Internet ``home page.''
    (e) How are ``industry-wide standards for recruitment'' to be 
identified? An employer is not required to utilize any particular number 
or type of recruitment methods, and may make a determination of the 
standards for the industry through methods such as trade organization 
surveys, studies by consultative groups, or reports/statements from 
trade organizations. An employer which makes such a determination should 
be prepared to demonstrate the industry-wide standards in the event of 
an enforcement action pursuant to subpart I of this part. An employer's 
recruitment shall be at a level and through methods and media which are 
normal, common or prevailing in the industry, including those strategies 
that have been shown to be successfully used by employers in the 
industry to recruit U.S. workers. An employer may not utilize only the 
lowest common denominator of recruitment methods used in the industry, 
or only methods which could reasonably be expected to be likely to yield 
few or no U.S. worker applicants, even if such unsuccessful recruitment 
methods are commonly used by employers in the industry. An employer's 
recruitment methods shall include, at a minimum, the following:
    (1) Both internal and external recruitment (i.e., both within the 
employer's workforce (former as well as current workers) and among U.S. 
workers elsewhere in the economy); and
    (2) At least some active recruitment, whether internal (e.g., 
training the employer's U.S. worker(s) for the position(s)) or external 
(e.g., use of recruitment agencies or college placement services).

[[Page 684]]

    (f) How are ``legitimate selection criteria relevant to the job that 
are normal or customary to the type of job involved'' to be identified? 
In conducting recruitment of U.S. workers (i.e., in soliciting 
applications and in pre-selection screening or considering of 
applicants), an employer shall apply selection criteria which satisfy 
all of the following three standards (i.e., paragraph (b) (1) through 
(3)). Under these standards, an employer would not apply spurious 
criteria that discriminate against U.S. worker applicants in favor of H-
1B nonimmigrants. An employer that uses criteria which fail to meet 
these standards would be considered to have failed to conduct its 
recruitment of U.S. workers in good faith.
    (1) Legitimate criteria, meaning criteria which are legally 
cognizable and not violative of any applicable laws (e.g., employer may 
not use age, sex, race or national origin as selection criteria);.
    (2) Relevant to the job, meaning criteria which have a nexus to the 
job's duties and responsibilities; and
    (3) Normal and customary to the type of job involved, meaning 
criteria which would be necessary or appropriate based on the practices 
and expectations of the industry, rather than on the preferences of the 
particular employer.
    (g) What actions would constitute a prohibited ``discriminatory 
manner'' of recruitment? The employer shall not apply otherwise-
legitimate screening criteria in a manner which would skew the 
recruitment process in favor of H-1B nonimmigrants. In other words, the 
employer's application of its screening criteria shall provide full and 
fair solicitation and consideration of U.S. applicants. The recruitment 
would be considered to be conducted in a discriminatory manner if the 
employer applied its screening criteria in a disparate manner (whether 
between H-1B and U.S. workers, or between jobs where H-1B nonimmigrants 
are involved and jobs where such workers are not involved). The employer 
would also be considered to be recruiting in a discriminatory manner if 
it used screening criteria that are prohibited by any applicable 
discrimination law (e.g., sex, race, age, national origin). The employer 
that conducts recruitment in a discriminatory manner would be considered 
to have failed to conduct its recruitment of U.S. workers in good faith.
    (h) What constitute ``good faith steps'' in recruitment of U.S. 
workers? The employer shall perform its recruitment, as described in 
paragraphs (d) through (g) of this section, so as to offer fair 
opportunities for employment to U.S. workers, without skewing the 
recruitment process against U.S. workers or in favor of H-1B 
nonimmigrants. No specific regimen is required for solicitation methods 
seeking applicants or for pre-selection treatment screening applicants. 
The employer's recruitment process, including pre-selection treatment, 
must assure that U.S. workers are given a fair chance for consideration 
for a job, rather than being ignored or rejected through a process that 
serves the employer's preferences with respect to the make up of its 
workforce (e.g., the Department would look with disfavor on a practice 
of interviewing H-1B applicants but not U.S. applicants, or a practice 
of screening the applications of H-1B nonimmigrants differently from the 
applications of U.S. workers). The employer shall not exercise a 
preference for its incumbent nonimmigrant workers who do not yet have H-
1B status (e.g., workers on student visas). The employer shall recruit 
in the United States, seeking U.S. worker(s), for the job(s) in the 
United States for which H-1B nonimmigrant(s) are or will be sought.
    (i) What documentation is the employer required to make or maintain, 
concerning its recruitment of U.S. workers?
    (1) The employer shall maintain documentation of the recruiting 
methods used, including the places and dates of the advertisements and 
postings or other recruitment methods used, the content of the 
advertisements and postings, and the compensation terms (if such are not 
included in the content of the advertisements and postings). The 
documentation may be in any form, including copies of advertisements or 
proofs from the publisher, the order or confirmation from the publisher, 
an electronic or printed copy of

[[Page 685]]

the Internet posting, or a memorandum to the file.
    (2) The employer shall retain any documentation it has received or 
prepared concerning the treatment of applicants, such as copies of 
applications and/or related documents, test papers, rating forms, 
records regarding interviews, and records of job offers and applicants' 
responses. To comply with this requirement, the employer is not required 
to create any documentation it would not otherwise create.
    (3) The documentation maintained by the employer shall be made 
available to the Administrator in the event of an enforcement action 
pursuant to subpart I of this part. The documentation shall be 
maintained for the period of time specified inSec. 655.760.
    (4) The employer's public access file maintained in accordance with 
Sec.  655.760 shall contain information summarizing the principal 
recruitment methods used and the time frame(s) in which such recruitment 
methods were used. This may be accomplished either through a memorandum 
or through copies of pertinent documents.
    (j) In addition to conducting good faith recruitment of U.S. workers 
(as described in paragraphs (a) through (h) of this section), the 
employer is required to have offered the job to any U.S. worker who 
applies and is equally or better qualified for the job than the H-1B 
nonimmigrant (see 8 U.S.C. 1182(n)(1)(G)(i)(II)); this requirement is 
enforced by the Department of Justice (see 8 U.S.C. 1182(n)(5); 20 CFR 
655.705(c)).

[65 FR 80231, Dec. 20, 2000]



Sec.  655.740  What actions are taken on labor condition applications?

    (a) Actions on labor condition applications submitted for filing. 
Once a labor condition application has been received from an employer, a 
determination shall be made by the ETA Certifying Officer whether to 
certify the labor condition application or return it to the employer not 
certified.
    (1) Certification of labor condition application. Where all items on 
Form ETA 9035 or Form ETA 9035E have been completed, the form is not 
obviously inaccurate, and in the case of Form ETA 9035, it contains the 
signature of the employer or its authorized agent or representative, the 
Certifying Officer shall certify the labor condition application unless 
it falls within one of the categories set forth in paragraph (a)(2) of 
this section. The Certifying Officer shall make a determination to 
certify or not certify the labor condition application within 7 working 
days of the date the application is received and date-stamped by the 
Department. If the labor condition application is certified, the 
Certifying Officer shall return a certified copy of the labor condition 
application to the employer or the employer's authorized agent or 
representative. The employer shall file the certified labor condition 
application with the appropriate DHS office in the manner prescribed by 
DHS. The DHS shall determine whether each occupational classification 
named in the certified labor condition application is a specialty 
occupation or is a fashion model of distinguished merit and ability.
    (2) Determinations not to certify labor condition applications. ETA 
shall not certify a labor condition application and shall return such 
application to the employer or the employer's authorized agent or 
representative, when either or both of the following two conditions 
exists:
    (i) When the Form ETA 9035 or 9035E is not properly completed. 
Examples of a Form ETA 9035 or 9035E which is not properly completed 
include instances where the employer has failed to check all the 
necessary boxes; or where the employer has failed to state the 
occupational classification, number of nonimmigrants sought, wage rate, 
period of intended employment, place of intended employment, or 
prevailing wage and its source; or, in the case of Form ETA 9035, where 
the application does not contain the signature of the employer or the 
employer's authorized representative.
    (ii) When the Form ETA 9035 or ETA 9035E contains obvious 
inaccuracies. An obvious inaccuracy will be found if the employer files 
an application in error--e.g., where the Administrator, Wage and Hour 
Division, after notice and opportunity for a hearing pursuant to subpart 
I of this part, has notified ETA in writing that the employer has been

[[Page 686]]

disqualified from employing H-1B nonimmigrants under section 212(n)(2) 
of the INA (8 U.S.C. 1182(n)(2)) or from employing H-1B1 or E-3 
nonimmigrants under section 212(t)(3) of the INA (8 U.S.C. 1182(t)(3)). 
Examples of other obvious inaccuracies include stating a wage rate below 
the FLSA minimum wage, submitting an LCA earlier than six months before 
the beginning date of the period of intended employment, identifying 
multiple occupations on a single LCA, identifying a wage which is below 
the prevailing wage listed on the LCA, or identifying a wage range where 
the bottom of such wage range is lower than the prevailing wage listed 
on the LCA.
    (3) Correction and resubmission of labor condition application. If 
the labor condition application is not certified pursuant to paragraph 
(a)(2) (i) or (ii) of this section, ETA shall return it to the employer, 
or the employer's authorized agent or representative, explaining the 
reasons for such return without certification. The employer may 
immediately submit a corrected application to ETA. A ``resubmitted'' or 
``corrected'' labor condition application shall be treated as a new 
application by ETA (i.e., on a ``first come, first served'' basis) 
except that if the labor condition application is not certified pursuant 
to paragraph (a)(2)(ii) of this section because of notification by the 
Administrator of the employer's disqualification, such action shall be 
the final decision of the Secretary and no application shall be 
resubmitted by the employer.
    (b) Challenges to labor condition applications. ETA shall not 
consider information contesting a labor condition application received 
by ETA prior to the determination on the application. Such information 
shall not be made part of ETA's administrative record on the 
application, but shall be referred to ESA to be processed as a complaint 
pursuant to subpart I of this part, and, if such application is 
certified by ETA, the complaint will be handled by ESA under subpart I 
of this part.
    (c) Truthfulness and adequacy of information. DOL is not the 
guarantor of the accuracy, truthfulness or adequacy of a certified labor 
condition application. The burden of proof is on the employer to 
establish the truthfulness of the information contained on the labor 
condition application.

[59 FR 65659, 65676, Dec. 20, 1994, as amended at 65 FR 80232, Dec. 20, 
2000; 66 FR 63302, Dec. 5, 2001; 69 FR 68228, Nov. 23, 2004; 70 FR 
72563, Dec. 5, 2005; 73 FR 19949, Apr. 11, 2008]



Sec.  655.750  What is the validity period of the labor condition 
application?

    (a) Validity of certified labor condition applications. A labor 
condition application (LCA) certified underSec. 655.740 is valid for 
the period of employment indicated by the authorized DOL official on 
Form ETA 9035E or ETA 9035. The validity period of an LCA will not begin 
before the application is certified. If the approved LCA is the initial 
LCA issued for the nonimmigrant, the period of authorized employment 
must not exceed 3 years for an LCA issued on behalf of an H-1B or H-1B1 
nonimmigrant and must not exceed 2 years for an LCA issued on behalf of 
an E-3 nonimmigrant. If the approved LCA is for an extension of an H-1B1 
it must not exceed two years. The period of authorized employment in the 
aggregate is based on the first date of employment and ends:
    (1) In the case of an H-1B or initial H-1B1 LCA, on the latest date 
indicated or three years after the employment start date under the LCA, 
whichever comes first; or
    (2) In the case of an E-3 or an H-1B1 extension LCA, on the latest 
date indicated or two years after the employment start date under the 
LCA, whichever comes first.
    (b) Withdrawal of certified labor condition applications. (1) An 
employer who has filed a labor condition application which has been 
certified pursuant toSec. 655.740 of this part may withdraw such labor 
condition application at any time before the expiration of the validity 
period of the application, provided that:
    (i) H-1B, H-1B1, and E-3 nonimmigrants are not employed at the place 
of employment pursuant to the LCA; and
    (ii) The Administrator has not commenced an investigation of the 
particular application. Any such request for withdrawal shall be null 
and void; and the employer shall remain bound by the labor condition 
application until the enforcement proceeding is

[[Page 687]]

completed, at which time the application may be withdrawn.
    (2) Requests for withdrawals must be in writing and must be sent to 
ETA, Office of Foreign Labor Certification. ETA will publish the mailing 
address, and any future mailing address changes, in the Federal 
Register, and will also post the address on the DOL Web site at http://
www.foreignlaborcert.doleta.gov/.
    (3) An employer shall comply with the ``required wage rate'' and 
``prevailing working conditions'' statements of its labor condition 
application required under Sec.Sec. 655.731 and 655.732 of this part, 
respectively, even if such application is withdrawn, at any time H-1B 
nonimmigrants are employed pursuant to the application, unless the 
application is superseded by a subsequent application which is certified 
by ETA.
    (4) An employer's obligation to comply with the ``no strike or 
lockout'' and ``notice'' statements of its labor condition application 
(required under Sec.Sec. 655.733 and 655.734 of this part, 
respectively), shall remain in effect and the employer shall remain 
subject to investigation and sanctions for misrepresentation on these 
statements even if such application is withdrawn, regardless of whether 
H-1B nonimmigrants are actually employed, unless the application is 
superseded by a subsequent application which is certified by ETA.
    (5) Only for the purpose of assuring the labor standards protections 
afforded under the H-1B program, where an employer files a petition with 
DHS under the H-1B classification pursuant to a certified LCA that had 
been withdrawn by the employer, such petition filing binds the employer 
to all obligations under the withdrawn LCA immediately upon receipt of 
such petition by DHS.
    (c) Invalidation or suspension of a labor condition application. (1) 
Invalidation of a labor condition application shall result from 
enforcement action(s) by the Administrator, Wage and Hour Division, 
under subpart I of this part--e.g., a final determination finding the 
employer's failure to meet the application's condition regarding strike 
or lockout; or the employer's willful failure to meet the wage and 
working conditions provisions of the application; or the employer's 
substantial failure to meet the notice of specification requirements of 
the application; see Sec.Sec. 655.734 and 655.760 of this part; or the 
misrepresentation of a material fact in an application. Upon notice by 
the Administrator of the employer's disqualification, ETA shall 
invalidate the application and notify the employer, or the employer's 
authorized agent or representative. ETA shall notify the employer in 
writing of the reason(s) that the application is invalidated. When a 
labor condition application is invalidated, such action shall be the 
final decision of the Secretary.
    (2) Suspension of a labor condition application may result from a 
discovery by ETA that it made an error in certifying the application 
because such application is incomplete, contains one or more obvious 
inaccuracies, or has not been signed. In such event, ETA shall 
immediately notify DHS and the employer. When an application is 
suspended, the employer may immediately submit to the certifying officer 
a corrected or completed application. If ETA does not receive a 
corrected application within 30 days of the suspension, or if the 
employer was disqualified by the Administrator, the application shall be 
immediately invalidated as described in paragraph (c) of this section.
    (3) An employer shall comply with the ``required wages rate'' and 
``prevailing working conditions'' statements of its labor condition 
application required under Sec.Sec. 655.731 and 655.732 of this part, 
respectively, even if such application is suspended or invalidated, at 
any time H-1B nonimmigrants are employed pursuant to the application, 
unless the application is superseded by a subsequent application which 
is certified by ETA.
    (4) An employer's obligation to comply with the ``no strike or 
lockout'' and ``notice'' statements of its labor condition application 
(required under Sec.Sec. 655.733 and 655.734 of this part, 
respectively), shall remain in effect and the employer shall remain 
subject to investigation and sanctions for misrepresentation on these 
statements even if such application is suspended or invalidated, 
regardless of whether H-1B nonimmigrants are actually employed, unless 
the application is superseded by a

[[Page 688]]

subsequent application which is certified by ETA.
    (d) Employers subject to disqualification. No labor condition 
application shall be certified for an employer which has been found to 
be disqualified from participation, in the H-1B program as determined in 
a final agency action following an investigation by the Wage and Hour 
Division pursuant to subpart I of this part.

[59 FR 65659, 65676, Dec. 20, 1994, as amended at 65 FR 80232, Dec. 20, 
2000; 66 FR 63302, Dec. 5, 2001; 70 FR 72563, Dec. 5, 2005; 73 FR 19949, 
Apr. 11, 2008]



Sec.  655.760  What records are to be made available to the public, 
and what records are to be retained?

    Paragraphs (a)(1) thru (a)(6) and paragraphs (b) and (c) of this 
section also apply to the H-1B1 and E-3 visa categories.
    (a) Public examination. The employer shall make a filed labor 
condition application and necessary supporting documentation available 
for public examination at the employer's principal place of business in 
the U.S. or at the place of employment within one working day after the 
date on which the labor condition application is filed with DOL. The 
following documentation shall be necessary:
    (1) A copy of the certified labor condition application (Form ETA 
9035E or Form ETA 9035) and cover pages (Form ETA 9035CP). If the Form 
ETA 9035E is submitted electronically, a printout of the certified 
application shall be signed by the employer and maintained in its files 
and included in the public examination file.
    (2) Documentation which provides the wage rate to be paid the H-1B 
nonimmigrant;
    (3) A full, clear explanation of the system that the employer used 
to set the ``actual wage'' the employer has paid or will pay workers in 
the occupation for which the H-1B nonimmigrant is sought, including any 
periodic increases which the system may provide--e.g., memorandum 
summarizing the system or a copy of the employer's pay system or scale 
(payroll records are not required, although they shall be made available 
to the Department in an enforcement action).
    (4) A copy of the documentation the employer used to establish the 
``prevailing wage'' for the occupation for which the H-1B nonimmigrant 
is sought (a general description of the source and methodology is all 
that is required to be made available for public examination; the 
underlying individual wage data relied upon to determine the prevailing 
wage is not a public record, although it shall be made available to the 
Department in an enforcement action); and
    (5) A copy of the document(s) with which the employer has satisfied 
the union/employee notification requirements ofSec. 655.734 of this 
part.
    (6) A summary of the benefits offered to U.S. workers in the same 
occupational classifications as H-1B nonimmigrants, a statement as to 
how any differentiation in benefits is made where not all employees are 
offered or receive the same benefits (such summary need not include 
proprietary information such as the costs of the benefits to the 
employer, or the details of stock options or incentive distributions), 
and/or, where applicable, a statement that some/all H-1B nonimmigrants 
are receiving ``home country'' benefits (seeSec. 655.731(c)(3));
    (7) Where the employer undergoes a change in corporate structure, a 
sworn statement by a responsible official of the new employing entity 
that it accepts all obligations, liabilities and undertakings under the 
LCAs filed by the predecessor employing entity, together with a list of 
each affected LCA and its date of certification, and a description of 
the actual wage system and FEIN of the new employing entity (seeSec. 
655.730(e)(1)).
    (8) Where the employer utilizes the definition of ``single 
employer''in the IRC, a list of any entities included as part of the 
single employer in making the determination as to its H-1B-dependency 
status (seeSec. 655.736(d)(7));
    (9) Where the employer is H-1B-dependent and/or a willful violator, 
and indicates on the LCA(s) that only ``exempt'' H-1B nonimmigrants will 
be employed, a list of such ``exempt'' H-1B nonimmigrants (seeSec. 
655.737(e)(1));
    (10) Where the employer is H-1B-dependent or a willful violator, a 
summary of the recruitment methods used

[[Page 689]]

and the time frames of recruitment of U.S. workers (or copies of 
pertinent documents showing this information) (seeSec. 655.739(i)(4).
    (b) National lists of applications and attestations. ETA shall 
compile and maintain on a current basis a list of the labor condition 
applications filed under INA section 212(n) regarding H-1B nonimmigrants 
and a list of labor attestations filed under INA section 212(t) 
regarding H-1B1 nonimmigrants. Each list shall be by employer, showing 
the occupational classification, wage rate(s), number of nonimmigrants 
sought, period(s) of intended employment, and date(s) of need for each 
employer's application. The list shall be available for public 
examination at the Office of Foreign Labor Certification, Department of 
Labor, 200 Constitution Avenue, NW., Room C-4312, Washington, DC 20210.
    (c) Retention of records. Either at the employer's principal place 
of business in the U.S. or at the place of employment, the employer 
shall retain copies of the records required by this subpart for a period 
of one year beyond the last date on which any H-1B nonimmigrant is 
employed under the labor condition application or, if no nonimmigrants 
were employed under the labor condition application, one year from the 
date the labor condition application expired or was withdrawn. Required 
payroll records for the H-1B employees and other employees in the 
occupational classification shall be retained at the employer's 
principal place of business in the U.S. or at the place of employment 
for a period of three years from the date(s) of the creation of the 
record(s), except that if an enforcement action is commenced, all 
payroll records shall be retained until the enforcement proceeding is 
completed through the procedures set forth in subpart I of this part.

(Approved by the Office of Management and Budget under control number 
1205-0310)

[59 FR 65659, 65676, Dec. 20, 1994, as amended at 60 FR 4029, Jan. 19, 
1995; 65 FR 80232, Dec. 20, 2000; 66 FR 63302, Dec. 5, 2001; 69 FR 
68228, Nov. 23, 2004; 70 FR 72563, Dec. 5, 2005; 71 FR 35521, June 21, 
2006; 73 FR 19950, Apr. 11, 2008]



Subpart I_Enforcement of H-1B Labor Condition Applications and
H-1B1 and E-3 Labor Attestations

    Source: 59 FR 65672, 65676, Dec. 20, 1994, unless otherwise noted.



Sec.  655.800  Who will enforce the LCAs and how will they be enforced?

    (a) Authority of Administrator. Except as provided inSec. 655.807, 
the Administrator shall perform all the Secretary's investigative and 
enforcement functions under sections 212(n) and (t) of the INA (8 U.S.C. 
1182(n) and (t)) and this subpart I and subpart H of this part.
    (b) Conduct of investigations. The Administrator, either pursuant to 
a complaint or otherwise, shall conduct such investigations as may be 
appropriate and, in connection therewith, enter and inspect such places 
and such records (and make transcriptions or copies thereof), question 
such persons and gather such information as deemed necessary by the 
Administrator to determine compliance regarding the matters which are 
the subject of the investigation.
    (c) Employer cooperation/availability of records. An employer shall 
at all times cooperate in administrative and enforcement proceedings. An 
employer being investigated shall make available to the Administrator 
such records, information, persons, and places as the Administrator 
deems appropriate to copy, transcribe, question, or inspect. No employer 
subject to the provisions of sections 212(n) or (t) of the INA and/or 
this subpart I or subpart H of this part shall interfere with any 
official of the Department of Labor performing an investigation, 
inspection or law enforcement function pursuant to 8 U.S.C. 1182(n) or 
(t) or this subpart I or subpart H of this part. Any such interference 
shall be a violation of the labor condition application and this subpart 
I and subpart H of this part, and the Administrator may take such 
further actions as the Administrator considers appropriate. (Federal 
criminal statutes prohibit certain interference with a Federal officer 
in the performance of official duties. 18 U.S.C. 111 and 18 U.S.C. 
1114.)

[[Page 690]]

    (d) Confidentiality. The Administrator shall, to the extent possible 
under existing law, protect the confidentiality of any person who 
provides information to the Department in confidence in the course of an 
investigation or otherwise under this subpart I or subpart H of this 
part.

[65 FR 80233, Dec. 20, 2000, as amended at 69 FR 68228, Nov. 23, 2004]



Sec.  655.801  What protection do employees have from retaliation?

    (a) No employer subject to this subpart I or subpart H of this part 
shall intimidate, threaten, restrain, coerce, blacklist, discharge or in 
any other manner discriminate against an employee (which term includes a 
former employee or an applicant for employment) because the employee 
has--
    (1) Disclosed information to the employer, or to any other person, 
that the employee reasonably believes evidences a violation of sections 
212(n) or (t) of the INA or any regulation relating to sections 212(n) 
or (t), including this subpart I and subpart H of this part and any 
pertinent regulations of DHS or the Department of Justice; or
    (2) Cooperated or sought to cooperate in an investigation or other 
proceeding concerning the employer's compliance with the requirements of 
sections 212(n) or (t) of the INA or any regulation relating to sections 
212(n) or (t).
    (b) It shall be a violation of this section for any employer to 
engage in the conduct described in paragraph (a) of this section. Such 
conduct shall be subject to the penalties prescribed by sections 
212(n)(2)(C)(ii) or (t)(3)(C)(ii) of the INA andSec. 655.810(b)(2), 
i.e., a fine of up to $5,000, disqualification from filing petitions 
under section 204 or section 214(c) of the INA for at least two years, 
and such further administrative remedies as the Administrator considers 
appropriate.
    (c) Pursuant to sections 212(n)(2)(C)(v) and (t)(3)(C)(v) of the 
INA, an H-1B nonimmigrant who has filed a complaint alleging that an 
employer has discriminated against the employee in violation of 
paragraph (a)(1) of this section may be allowed to seek other 
appropriate employment in the United States, provided the employee is 
otherwise eligible to remain and work in the United States. Such 
employment may not exceed the maximum period of stay authorized for a 
nonimmigrant classified under sections 212(n) or (t) of the INA, as 
applicable. Further information concerning this provision should be 
sought from the United States Citizenship and Immigration Services of 
the Department of Homeland Security.

[65 FR 80233, Dec. 20, 2000, as amended at 69 FR 68229, Nov. 23, 2004; 
71 FR 35521, June 21, 2006]



Sec.  655.805  What violations may the Administrator investigate?

    (a) The Administrator, through investigation, shall determine 
whether an H-1B employer has--
    (1) Filed a labor condition application with ETA which misrepresents 
a material fact (Note to paragraph (a)(1): Federal criminal statutes 
provide penalties of up to $10,000 and/or imprisonment of up to five 
years for knowing and willful submission of false statements to the 
Federal Government. 18 U.S.C. 1001; see also 18 U.S.C. 1546);
    (2) Failed to pay wages (including benefits provided as compensation 
for services), as required underSec. 655.731 (including payment of 
wages for certain nonproductive time);
    (3) Failed to provide working conditions as required underSec. 
655.732;
    (4) Filed a labor condition application for H-1B nonimmigrants 
during a strike or lockout in the course of a labor dispute in the 
occupational classification at the place of employment, as prohibited by 
Sec.  655.733;
    (5) Failed to provide notice of the filing of the labor condition 
application, as required inSec. 655.734;
    (6) Failed to specify accurately on the labor condition application 
the number of workers sought, the occupational classification in which 
the H-1B nonimmigrant(s) will be employed, or the wage rate and 
conditions under which the H-1B nonimmigrant(s) will be employed;
    (7) Displaced a U.S. worker (including displacement of a U.S. worker 
employed by a secondary employer at the worksite where an H-1B worker is 
placed), as prohibited bySec. 655.738 (if applicable);

[[Page 691]]

    (8) Failed to make the required displacement inquiry of another 
employer at a worksite where H-1B nonimmigrant(s) were placed, as set 
forth inSec. 655.738 (if applicable);
    (9) Failed to recruit in good faith, as required bySec. 655.739 
(if applicable);
    (10) Displaced a U.S. worker in the course of committing a willful 
violation of any of the conditions in paragraphs (a)(2) through (9) of 
this section, or willful misrepresentation of a material fact on a labor 
condition application;
    (11) Required or accepted from an H-1B nonimmigrant payment or 
remittance of the additional $500/$1,000 fee incurred in filing an H-1B 
petition with the DHS, as prohibited bySec. 655.731(c)(10)(ii);
    (12) Required or attempted to require an H-1B nonimmigrant to pay a 
penalty for ceasing employment prior to an agreed upon date, as 
prohibited bySec. 655.731(c)(10)(i);
    (13) Discriminated against an employee for protected conduct, as 
prohibited bySec. 655.801;
    (14) Failed to make available for public examination the application 
and necessary document(s) at the employer's principal place of business 
or worksite, as required bySec. 655.760(a);
    (15) Failed to maintain documentation, as required by this part; and
    (16) Failed otherwise to comply in any other manner with the 
provisions of this subpart I or subpart H of this part.
    (b) The determination letter setting forth the investigation 
findings (seeSec. 655.815) shall specify if the violations were found 
to be substantial or willful. Penalties may be assessed and 
disqualification ordered for violation of the provisions in paragraphs 
(a)(5), (6), or (9) of this section only if the violation was found to 
be substantial or willful. The penalties may be assessed and 
disqualification ordered for violation of the provisions in paragraphs 
(a)(2) or (3) of this section only if the violation was found to be 
willful, but the Secretary may order payment of back wages (including 
benefits) due for such violation whether or not the violation was 
willful.
    (c) For purposes of this part, ``willful failure'' means a knowing 
failure or a reckless disregard with respect to whether the conduct was 
contrary to sections 212(n)(1)(A)(i) or (ii), or 212(t)(1)(A)(i) or (ii) 
of the INA, or Sec.Sec. 655.731 or 655.732. See McLaughlin v. Richland 
Shoe Co., 486 U.S. 128 (1988); see also Trans World Airlines v. 
Thurston, 469 U.S. 111 (1985).
    (d) The provisions of this part become applicable upon the date that 
the employer's LCA is certified pursuant to Sec.Sec. 655.740 and 
655.750, or upon the date employment commences pursuant to section 
214(m) of the INA, whichever is earlier. The employer's submission and 
signature on the LCA (whether Form ETA 9035 or Form ETA 9035E) each 
constitutes the employer's representation that the statements on the LCA 
are accurate and its acknowledgment and acceptance of the obligations of 
the program. The employer's acceptance of these obligations is re-
affirmed by the employer's submission of the petition (Form I-129) to 
the DHS, supported by the LCA. See 8 CFR 214.2(h)(4)(iii)(B)(2), which 
specifies that the employer will comply with the terms of the LCA for 
the duration of the H-1B nonimmigrant's authorized period of stay. If 
the period of employment specified in the LCA expires or the employer 
withdraws the application in accordance withSec. 655.750(b), the 
provisions of this part will no longer apply with respect to such 
application, except as provided inSec. 655.750(b)(3) and (4).

[65 FR 80233, Dec. 20, 2000, as amended at 66 FR 63302, Dec. 5, 2001; 69 
FR 68229, Nov. 23, 2004]



Sec.  655.806  Who may file a complaint and how is it processed?

    (a) Any aggrieved party, as defined inSec. 655.715, may file a 
complaint alleging a violation described inSec. 655.805(a). The 
procedures for filing a complaint by an aggrieved party and its 
processing by the Administrator are set forth in this section. The 
procedures for filing and processing information alleging violations 
from persons or organizations that are not aggrieved parties are set 
forth inSec. 655.807. With regard to complaints filed by any aggrieved 
person or organization--
    (1) No particular form of complaint is required, except that the 
complaint

[[Page 692]]

shall be written or, if oral, shall be reduced to writing by the Wage 
and Hour Division official who receives the complaint.
    (2) The complaint shall set forth sufficient facts for the 
Administrator to determine whether there is reasonable cause to believe 
that a violation as described inSec. 655.805 has been committed, and 
therefore that an investigation is warranted. This determination shall 
be made within 10 days of the date that the complaint is received by a 
Wage and Hour Division official. If the Administrator determines that 
the complaint fails to present reasonable cause for an investigation, 
the Administrator shall so notify the complainant, who may submit a new 
complaint, with such additional information as may be necessary. No 
hearing or appeal pursuant to this subpart shall be available where the 
Administrator determines that an investigation on a complaint is not 
warranted.
    (3) If the Administrator determines that an investigation on a 
complaint is warranted, the complaint shall be accepted for filing; an 
investigation shall be conducted and a determination issued within 30 
calendar days of the date of filing. The time for the investigation may 
be increased with the consent of the employer and the complainant, or 
if, for reasons outside of the control of the Administrator, the 
Administrator needs additional time to obtain information needed from 
the employer or other sources to determine whether a violation has 
occurred. No hearing or appeal pursuant to this subpart shall be 
available regarding the Administrator's determination that an 
investigation on a complaint is warranted.
    (4) In the event that the Administrator seeks a prevailing wage 
determination from ETA pursuant toSec. 655.731(d), or advice as to 
prevailing working conditions from ETA pursuant toSec. 655.732(c)(2), 
the 30-day investigation period shall be suspended from the date of the 
Administrator's request to the date of the Administrator's receipt of 
the wage determination (or, in the event that the employer challenges 
the wage determination through the Employment Service complaint system, 
to the date of the completion of such complaint process).
    (5) A complaint must be filed not later than 12 months after the 
latest date on which the alleged violation(s) were committed, which 
would be the date on which the employer allegedly failed to perform an 
action or fulfill a condition specified in the LCA, or the date on which 
the employer, through its action or inaction, allegedly demonstrated a 
misrepresentation of a material fact in the LCA. This jurisdictional bar 
does not affect the scope of the remedies which may be assessed by the 
Administrator. Where, for example, a complaint is timely filed, back 
wages may be assessed for a period prior to one year before the filing 
of a complaint.
    (6) A complaint may be submitted to any local Wage and Hour Division 
office. The addresses of such offices are found in local telephone 
directories, and on the Department's informational site on the Internet 
at http://www.dol.gov/dol/esa/public/contacts/whd/america2.htm. The 
office or person receiving such a complaint shall refer it to the office 
of the Wage and Hour Division administering the area in which the 
reported violation is alleged to have occurred.
    (b) When an investigation has been conducted, the Administrator 
shall, pursuant toSec. 655.815, issue a written determination as 
described inSec. 655.805(a).

[65 FR 80234, Dec. 20, 2000]



Sec.  655.807  How may someone who is not an ``aggrieved party''
allege violations, and how will those allegations be processed?

    (a) Persons who are not aggrieved parties may submit information 
concerning possible violations of the provisions described inSec. 
655.805(a)(1) through (4) and (a)(7) through (9). No particular form is 
required to submit the information, except that the information shall be 
submitted in writing or, if oral, shall be reduced to writing by the 
Wage and Hour Division official who receives the information. An 
optional form shall be available to be used in setting forth the 
information. The information provided shall include:

[[Page 693]]

    (1) The identity of the person submitting the information and the 
person's relationship, if any, to the employer or other information 
concerning the person's basis for having knowledge of the employer's 
employment practices or its compliance with the requirements of this 
subpart I and subpart H of this part; and
    (2) A description of the possible violation, including a description 
of the facts known to the person submitting the information, in 
sufficient detail for the Secretary to determine if there is reasonable 
cause to believe that the employer has committed a willful violation of 
the provisions described inSec. 655.805(a)(1), (2), (3), (4), (7), 
(8), or (9).
    (b) The Administrator may interview the person submitting the 
information as appropriate to obtain further information to determine 
whether the requirements of this section are met. In addition, the 
person submitting information under this section shall be informed that 
his or her identity will not be disclosed to the employer without his or 
her permission.
    (c) Information concerning possible violations must be submitted not 
later than 12 months after the latest date on which the alleged 
violation(s) were committed. The 12-month period shall be applied in the 
manner described inSec. 655.806(a)(5).
    (d) Upon receipt of the information, the Administrator shall 
promptly review the information submitted and determine:
    (1) Does the source likely possess knowledge of the employer's 
practices or employment conditions or the employer's compliance with the 
requirements of subpart H of this part?
    (2) Has the source provided specific credible information alleging a 
violation of the requirements of the conditions described inSec. 
655.805(a)(1), (2), (3), (4), (7), (8), or (9)?
    (3) Does the information in support of the allegations appear to 
provide reasonable cause to believe that the employer has committed a 
violation of the provisions described inSec. 655.805(a)(1), (2), (3), 
(4), (7), (8), or (9), and that
    (i) The alleged violation is willful?
    (ii) The employer has engaged in a pattern or practice of 
violations? or
    (iii) The employer has committed substantial violations, affecting 
multiple employees?
    (e) ``Information'' within the meaning of this section does not 
include information from an officer or employee of the Department of 
Labor unless it was obtained in the course of a lawful investigation, 
and does not include information submitted by the employer to the DHS or 
the Secretary in securing the employment of an H-1B nonimmigrant.
    (f)(1) Except as provided in paragraph (f)(2) of this section, where 
the Administrator has received information from a source other than an 
aggrieved party which satisfies all of the requirements of paragraphs 
(a) through (d) of this section, or where the Administrator or another 
agency of the Department obtains such information in a lawful 
investigation under this or any other section of the INA or any other 
Act, the Administrator (by mail or facsimile transmission) shall 
promptly notify the employer that the information has been received, 
describe the nature of the allegation in sufficient detail to permit the 
employer to respond, and request that the employer respond to the 
allegation within 10 days of its receipt of the notification. The 
Administrator shall not identify the source or information which would 
reveal the identity of the source without his or her permission.
    (2) The Administrator may dispense with notification to the employer 
of the alleged violations if the Administrator determines that such 
notification might interfere with an effort to secure the employer's 
compliance. This determination shall not be subject to review in any 
administrative proceeding and shall not be subject to judicial review.
    (g) After receipt of any response to the allegations provided by the 
employer, the Administrator will promptly review all of the information 
received and determine whether the allegations should be referred to the 
Secretary for a determination whether an investigation should be 
commenced by the Administrator.
    (h) If the Administrator refers the allegations to the Secretary, 
the Secretary shall make a determination as

[[Page 694]]

to whether to authorize an investigation under this section.
    (1) No investigation shall be commenced unless the Secretary (or the 
Deputy Secretary or other Acting Secretary in the absence or disability) 
personally authorizes the investigation and certifies--
    (i) That the information provided under paragraph (a) of this 
section or obtained pursuant to a lawful investigation by the Department 
of Labor provides reasonable cause to believe that the employer has 
committed a violation of the provisions described inSec. 
655.805(a)(1), (2), (3), (4), (7), (8), or (9);
    (ii) That there is reasonable cause to believe the alleged 
violations are willful, that the employer has engaged in a pattern or 
practice of such violations, or that the employer has committed 
substantial violations, affecting multiple employees; and
    (iii) That the other requirements of paragraphs (a) through (d) of 
this section have been met.
    (2) No hearing shall be available from a decision by the 
Administrator declining to refer allegations addressed by this section 
to the Secretary, and none shall be available from a decision by the 
Secretary certifying or declining to certify that an investigation is 
warranted.
    (i) If the Secretary issues a certification, an investigation shall 
be conducted and a determination issued within 30 days after the 
certification is received by the local Wage and Hour office undertaking 
the investigation. The time for the investigation may be increased upon 
the agreement of the employer and the Administrator or, if for reasons 
outside of the control of the Administrator, additional time is 
necessary to obtain information needed from the employer or other 
sources to determine whether a violation has occurred.
    (j) In the event that the Administrator seeks a prevailing wage 
determination from ETA pursuant toSec. 655.731(d), or advice as to 
prevailing working conditions from ETA pursuant toSec. 655.732(c)(2), 
the 30-day investigation period shall be suspended from the date of the 
Administrator's request to the date of the Administrator's receipt of 
the wage determination (or, in the event that the employer challenges 
the wage determination through the Employment Service complaint system, 
to the date of the completion of such complaint process).
    (k) Following the investigation, the Administrator shall issue a 
determination in accordance with toSec. 655.815.
    (l) This section shall expire on September 30, 2003 unless section 
212(n)(2)(G) of the INA is extended by future legislative action. Absent 
such extension, no investigation shall be certified by the Secretary 
under this section after that date; however, any investigation certified 
on or before September 30, 2003 may be completed.

[65 FR 80234, Dec. 20, 2000]



Sec.  655.808  Under what circumstances may random investigations
be conducted?

    (a) The Administrator may conduct random investigations of an 
employer during a five-year period beginning with the date of any of the 
following findings, provided such date is on or after October 21, 1998:
    (1) A finding by the Secretary that the employer willfully violated
    any of the provisions described inSec. 655.805(a)(1) through (9);
    (2) A finding by the Secretary that the employer willfully 
misrepresented material fact(s) in a labor condition application filed 
pursuant toSec. 655.730; or
    (3) A finding by the Attorney General that the employer willfully 
failed to meet the condition of section 212(n)(1)(G)(i)(II) of the INA 
(pertaining to an offer of employment to an equally or better qualified 
U.S. worker).
    (b) A finding within the meaning of this section is a final, 
unappealed decision of the agency. See Sec.Sec. 655.520(a), 
655.845(c), and 655.855(b).
    (c) An investigation pursuant to this section may be made at any 
time the Administrator, in the exercise of discretion, considers 
appropriate, without regard to whether the Administrator has reason to 
believe a violation of the provisions of this subpart I and subpart

[[Page 695]]

H of this part has been committed. Following an investigation, the 
Administrator shall issue a determination in accordance withSec. 
655.815.

[65 FR 80236, Dec. 20, 2000]



Sec.  655.810  What remedies may be ordered if violations are found?

    (a) Upon determining that an employer has failed to pay wages or 
provide fringe benefits as required bySec. 655.731 andSec. 655.732, 
the Administrator shall assess and oversee the payment of back wages or 
fringe benefits to any H-1B nonimmigrant who has not been paid or 
provided fringe benefits as required. The back wages or fringe benefits 
shall be equal to the difference between the amount that should have 
been paid and the amount that actually was paid to (or with respect to) 
such nonimmigrant(s).
    (b) Civil money penalties. The Administrator may assess civil money 
penalties for violations as follows:
    (1) An amount not to exceed $1,000 per violation for:
    (i) A violation pertaining to strike/lockout (Sec.  655.733) or 
displacement of U.S. workers (Sec.  655.738);
    (ii) A substantial violation pertaining to notification (Sec.  
655.734), labor condition application specificity (Sec.  655.730), or 
recruitment of U.S. workers (Sec.  655.739);
    (iii) A misrepresentation of material fact on the labor condition 
application;
    (iv) An early-termination penalty paid by the employee (Sec.  
655.731(c)(10)(i));
    (v) Payment by the employee of the additional $500/$1,000 filing fee 
(Sec.  655.731(c)(10)(ii)); or
    (vi) Violation of the requirements of the regulations in this 
subpart I and subpart H of this part or the provisions regarding public 
access (Sec.  655.760) where the violation impedes the ability of the 
Administrator to determine whether a violation of sections 212(n) or (t) 
of the INA has occurred or the ability of members of the public to have 
information needed to file a complaint or information regarding alleged 
violations of sections 212(n) or (t) of the INA;
    (2) An amount not to exceed $5,000 per violation for:
    (i) A willful failure pertaining to wages/working conditions 
(Sec.Sec. 655.731, 655.732), strike/lockout, notification, labor 
condition application specificity, displacement (including placement of 
an H-1B nonimmigrant at a worksite where the other/secondary employer 
displaces a U.S. worker), or recruitment;
    (ii) A willful misrepresentation of a material fact on the labor 
condition application; or
    (iii) Discrimination against an employee (Sec.  655.801(a)); or
    (3) An amount not to exceed $35,000 per violation where an employer 
(whether or not the employer is an H-1B-dependent employer or willful 
violator) displaced a U.S. worker employed by the employer in the period 
beginning 90 days before and ending 90 days after the filing of an H-1B 
petition in conjunction with any of the following violations:
    (i) A willful violation of any of the provisions described inSec. 
655.805(a)(2) through (9) pertaining to wages/working condition, strike/
lockout, notification, labor condition application specificity, 
displacement, or recruitment; or
    (ii) A willful misrepresentation of a material fact on the labor 
condition application (Sec.  655.805(a)(1)).
    (c) In determining the amount of the civil money penalty to be 
assessed, the Administrator shall consider the type of violation 
committed and other relevant factors. The factors which may be 
considered include, but are not limited to, the following:
    (1) Previous history of violation, or violations, by the employer 
under the INA and this subpart I or subpart H of this part;
    (2) The number of workers affected by the violation or violations;
    (3) The gravity of the violation or violations;
    (4) Efforts made by the employer in good faith to comply with the 
provisions of 8 U.S.C. 1182(n) or (t) and this subparts H and I of this 
part;
    (5) The employer's explanation of the violation or violations;
    (6) The employer's commitment to future compliance; and
    (7) The extent to which the employer achieved a financial gain due 
to the violation, or the potential financial loss, potential injury or 
adverse effect with respect to other parties.

[[Page 696]]

    (d) Disqualification from approval of petitions. The Administrator 
shall notify the DHS pursuant toSec. 655.855 that the employer shall 
be disqualified from approval of any petitions filed by, or on behalf 
of, the employer pursuant to section 204 or section 214(c) of the INA 
for the following periods:
    (1) At least one year for violation(s) of any of the provisions 
specified in paragraph (b)(1)(i) through (iii) of this section;
    (2) At least two years for violation(s) of any of the provisions 
specified in paragraph (b)(2) of this section; or
    (3) At least three years, for violation(s) specified in paragraph 
(b)(3) of this section.
    (e) Other administrative remedies. (1) If the Administrator finds a 
violation of the provisions specified in paragraph (b)(1)(iv) or (v) of 
this section, the Administrator may issue an order requiring the 
employer to return to the employee (or pay to the U.S. Treasury if the 
employee cannot be located) any money paid by the employee in violation 
of those provisions.
    (2) If the Administrator finds a violation of the provisions 
specified in paragraph (b)(1)(i) through (iii), (b)(2), or (b)(3) of 
this section, the Administrator may impose such other administrative 
remedies as the Administrator determines to be appropriate, including 
but not limited to reinstatement of workers who were discriminated 
against in violation ofSec. 655.805(a), reinstatement of displaced 
U.S. workers, back wages to workers who have been displaced or whose 
employment has been terminated in violation of these provisions, or 
other appropriate legal or equitable remedies.
    (f) The civil money penalties, back wages, and/or any other 
remedy(ies) determined by the Administrator to be appropriate are 
immediately due for payment or performance upon the assessment by the 
Administrator, or upon the decision by an administrative law judge where 
a hearing is timely requested, or upon the decision by the Secretary 
where review is granted. The employer shall remit the amount of the 
civil money penalty by certified check or money order made payable to 
the order of ``Wage and Hour Division, Labor.'' The remittance shall be 
delivered or mailed to the Wage and Hour Division office in the manner 
directed in the Administrator's notice of determination. The payment or 
performance of any other remedy prescribed by the Administrator shall 
follow procedures established by the Administrator. Distribution of back 
wages shall be administered in accordance with existing procedures 
established by the Administrator.
    (g) The Federal Civil Penalties Inflation Adjustment Act of 1990, as 
amended (28 U.S.C. 2461 note), requires that inflationary adjustments to 
civil money penalties in accordance with a specified cost-of-living 
formula be made, by regulation, at least every four years. The 
adjustments are to be based on changes in the Consumer Price Index for 
all Urban Consumers (CPI-U) for the U.S. City Average for All Items. The 
adjusted amounts will be published in the Federal Register. The amount 
of the penalty in a particular case will be based on the amount of the 
penalty in effect at the time the violation occurs.

[65 FR 80236, Dec. 20, 2000, as amended at 69 FR 68229, Nov. 23, 2004]



Sec.  655.815  What are the requirements for the Administrator's 
determination?

    (a) The Administrator's determination, issued pursuant toSec. 
655.806, 655.807, or 655.808, shall be served on the complainant, the 
employer, and other known interested parties by personal service or by 
certified mail at the parties' last known addresses. Where service by 
certified mail is not accepted by the party, the Administrator may 
exercise discretion to serve the determination by regular mail.
    (b) The Administrator shall file with the Chief Administrative Law 
Judge, U.S. Department of Labor, a copy of the complaint and the 
Administrator's determination.
    (c) The Administrator's written determination required bySec. 
655.805 of this part shall:
    (1) Set forth the determination of the Administrator and the reason 
or reasons therefor, and in the case of a finding of violation(s) by an 
employer, prescribe any remedies, including the amount of any back wages 
assessed,

[[Page 697]]

the amount of any civil money penalties assessed and the reason 
therefor, and/or any other remedies assessed.
    (2) Inform the interested parties that they may request a hearing 
pursuant toSec. 655.820 of this part.
    (3) Inform the interested parties that in the absence of a timely 
request for a hearing, received by the Chief Administrative Law Judge 
within 15 calendar days of the date of the determination, the 
determination of the Administrator shall become final and not 
appealable.
    (4) Set forth the procedure for requesting a hearing, give the 
addresses of the Chief Administrative Law Judge (with whom the request 
must be filed) and the representative(s) of the Solicitor of labor (upon 
whom copies of the request must be served).
    (5) Where appropriate, inform the parties that, pursuant toSec. 
655.855, the Administrator shall notify ETA and the DHS of the 
occurrence of a violation by the employer.

[59 FR 65672, 65676, Dec. 20, 1994, as amended at 65 FR 80237, Dec. 20, 
2000]



Sec.  655.820  How is a hearing requested?

    (a) Any interested party desiring review of a determination issued 
under Sec.Sec. 655.805 and 655.815, including judicial review, shall 
make a request for such an administrative hearing in writing to the 
Chief Administrative Law Judge at the address stated in the notice of 
determination. If such a request for an administrative hearing is timely 
filed, the Administrator's determination shall be inoperative unless and 
until the case is dismissed or the Administrative Law Judge issues an 
order affirming the decision.
    (b) Interested parties may request a hearing in the following 
circumstances:
    (1) The complainant or any other interested party may request a 
hearing where the Administrator determines, after investigation, that 
there is no basis for a finding that an employer has committed 
violation(s). In such a proceeding, the party requesting the hearing 
shall be the prosecuting party and the employer shall be the respondent; 
the Administrator may intervene as a party or appear as amicus curiae at 
any time in the proceeding, at the Administrator's discretion.
    (2) The employer or any other interested party may request a hearing 
where the Administrator determines, after investigation, that the 
employer has committed violation(s). In such a proceeding, the 
Administrator shall be the prosecuting party and the employer shall be 
the respondent.
    (c) No particular form is prescribed for any request for hearing 
permitted by this section. However, any such request shall:
    (1) Be dated;
    (2) Be typewritten or legibly written;
    (3) Specify the issue or issues stated in the notice of 
determination giving rise to such request;
    (4) State the specific reason or reasons why the party requesting 
the hearing believes such determination is in error;
    (5) Be signed by the party making the request or by an authorized 
representative of such party; and
    (6) Include the address at which such party or authorized 
representative desires to receive further communications relating 
thereto.
    (d) The request for such hearing shall be received by the Chief 
Administrative Law Judge, at the address stated in the Administrator's 
notice of determination, no later than 15 calendar days after the date 
of the determination. An interested party which fails to meet this 15-
day deadline for requesting a hearing may thereafter participate in the 
proceedings only by consent of the administrative law judge, either 
through intervention as a party pursuant to 29 CFR 18.10 (b) through (d) 
or through participation as an amicus curiae pursuant to 29 CFR 18.12.
    (e) The request may be filed in person, by facsimile transmission, 
by certified or regular mail, or by courier service. For the requesting 
party's protection, if the request is by mail, it should be by certified 
mail. If the request is by facsimile transmission, the original of the 
request, signed by the requestor or authorized representative, shall be 
filed within ten days.
    (f) Copies of the request for a hearing shall be sent by the 
requestor to the Wage and Hour Division official who

[[Page 698]]

issued the Administrator's notice of determination, to the 
representative(s) of the Solicitor of Labor identified in the notice of 
determination, and to all known interested parties.

[59 FR 65672, 65676, Dec. 20, 1994, as amended at 65 FR 80237, Dec. 20, 
2000]



Sec.  655.825  What rules of practice apply to the hearing?

    (a) Except as specifically provided in this subpart, and to the 
extent they do not conflict with the provisions of this subpart, the 
``Rules of Practice and Procedure for Administrative Hearings Before the 
Office of Administrative Law Judges'' established by the Secretary at 29 
CFR part 18 shall apply to administrative proceedings under this 
subpart.
    (b) As provided in the Administrative Procedure Act, 5 U.S.C. 556, 
any oral or documentary evidence may be received in proceedings under 
this part. The Federal Rules of Evidence and subpart B of the Rules of 
Practice and Procedure for Administrative Hearings Before the Office of 
Administrative Law Judges (29 CFR part 18, subpart B) shall not apply, 
but principles designed to ensure production of relevant and probative 
evidence shall guide the admission of evidence. The administrative law 
judge may exclude evidence which is immaterial, irrelevant, or unduly 
repetitive.



Sec.  655.830  What rules apply to service of pleadings?

    (a) Under this subpart, a party may serve any pleading or document 
by regular mail. Service on a party is complete upon mailing to the last 
known address. No additional time for filing or response is authorized 
where service is by mail. In the interest of expeditious proceedings, 
the administrative law judge may direct the parties to serve pleadings 
or documents by a method other than regular mail.
    (b) Two (2) copies of all pleadings and other documents in any 
administrative law judge proceeding shall be served on the attorneys for 
the Administrator. One copy shall be served on the Associate Solicitor, 
Division of Fair Labor Standards, Office of the Solicitor, U.S. 
Department of Labor, 200 Constitution Avenue NW., Room N-2716, 
Washington, DC 20210, and one copy shall be served on the attorney 
representing the Administrator in the proceeding.
    (c) Time will be computed beginning with the day following the 
action and includes the last day of the period unless it is a Saturday, 
Sunday, or federally-observed holiday, in which case the time period 
includes the next business day.



Sec.  655.835  How will the administrative law judge conduct the
proceeding?

    (a) Upon receipt of a timely request for a hearing filed pursuant to 
and in accordance withSec. 655.820 of this part, the Chief 
Administrative Law Judge shall promptly appoint an administrative law 
judge to hear the case.
    (b) Within 7 calendar days following the assignment of the case, the 
administrative law judge shall notify all interested parties of the 
date, time and place of the hearing. All parties shall be given at least 
fourteen calendar days notice of such hearing.
    (c) The date of the hearing shall be not more than 60 calendar days 
from the date of the Administrator's determination. Because of the time 
constraints imposed by the INA, no request for postponement shall be 
granted except for compelling reasons. Even where such reasons are 
shown, no request for postponement of the hearing beyond the 60-day 
deadline shall be granted except by consent of all the parties to the 
proceeding.
    (d) The administrative law judge may prescribe a schedule by which 
the parties are permitted to file a prehearing brief or other written 
statement of fact or law. Any such brief or statement shall be served 
upon each other party in accordance withSec. 655.830 of this part. 
Posthearing briefs will not be permitted except at the request of the 
administrative law judge. When permitted, any such brief shall be 
limited to the issue or issues specified by the administrative law 
judge, shall be due within the time prescribed by the administrative law 
judge, and shall be served on each other party in accordance withSec. 
655.830 of this part.

[[Page 699]]



Sec.  655.840  What are the requirements for a decision and order of 
the administrative law judge?

    (a) Within 60 calendar days after the date of the hearing, the 
administrative law judge shall issue a decision. If any party desires 
review of the decision, including judicial review, a petition for 
Secretary's review thereof shall be filed as provided inSec. 655.845 
of this subpart. If a petition for review is filed, the decision of the 
administrative law judge shall be inoperative unless and until the 
Secretary issues an order affirming the decision, or, unless and until 
30 calendar days have passed after the Secretary's receipt of the 
petition for review and the Secretary has not issued notice to the 
parties that the Secretary will review the administrative law judge's 
decision.
    (b) The decision of the administrative law judge shall include a 
statement of findings and conclusions, with reasons and basis therefor, 
upon each material issue presented on the record. The decision shall 
also include an appropriate order which may affirm, deny, reverse, or 
modify, in whole or in part, the determination of the Administrator; the 
reason or reasons for such order shall be stated in the decision.
    (c) In the event that the Administrator's determination of wage 
violation(s) and computation of back wages are based upon a wage 
determination obtained by the Administrator from ETA during the 
investigation (pursuant toSec. 655.731(d)) and the administrative law 
judge determines that the Administrator's request was not warranted 
(under the standards inSec. 655.731(d)), the administrative law judge 
shall remand the matter to the Administrator for further proceedings on 
the existence of wage violations and/or the amount(s) of back wages 
owed. If there is no such determination and remand by the administrative 
law judge, the administrative law judge shall accept as final and 
accurate the wage determination obtained from ETA or, in the event 
either the employer or another interested party filed a timely complaint 
through the Employment Service complaint system, the final wage 
determination resulting from that process. SeeSec. 655.731; see also 
20 CFR 658.420 through 658.426. Under no circumstances shall the 
administrative law judge determine the validity of the wage 
determination or require submission into evidence or disclosure of 
source data or the names of establishments contacted in developing the 
survey which is the basis for the prevailing wage determination.
    (d) The administrative law judge shall not render determinations as 
to the legality of a regulatory provision or the constitutionality of a 
statutory provision.
    (e) The decision shall be served on all parties in person or by 
certified or regular mail.

[59 FR 65672, 65676, Dec. 20, 1994, as amended at 65 FR 80237, Dec. 20, 
2000]



Sec.  655.845  What rules apply to appeal of the decision of the 
administrative law judge?

    (a) The Administrator or any interested party desiring review of the 
decision and order of an administrative law judge, including judicial 
review, shall petition the Department's Administrative Review Board 
(Board) to review the decision and order. To be effective, such petition 
shall be received by the Board within 30 calendar days of the date of 
the decision and order. Copies of the petition shall be served on all 
parties and on the administrative law judge.
    (b) No particular form is prescribed for any petition for the 
Board's review permitted by this subpart. However, any such petition 
shall:
    (1) Be dated;
    (2) Be typewritten or legibly written;
    (3) Specify the issue or issues stated in the administrative law 
judge decision and order giving rise to such petition;
    (4) State the specific reason or reasons why the party petitioning 
for review believes such decision and order are in error;
    (5) Be signed by the party filing the petition or by an authorized 
representative of such party;
    (6) Include the address at which such party or authorized 
representative desires to receive further communications relating 
thereto; and
    (7) Attach copies of the administrative law judge's's decision and 
order, and any other record documents which

[[Page 700]]

would assist the Board in determining whether review is warranted.
    (c) Whenever the Board determines to review the decision and order 
of an administrative law judge, a notice of the Board's determination 
shall be served upon the administrative law judge, upon the Office of 
Administrative Law Judges, and upon all parties to the proceeding within 
30 calendar days after the Board's receipt of the petition for review. 
If the Board determines that it will review the decision and order, the 
order shall be inoperative unless and until the Board issues an order 
affirming the decision and order.
    (d) Upon receipt of the Board's notice, the Office of Administrative 
Law Judges shall within 15 calendar days forward the complete hearing 
record to the Board.
    (e) The Board's notice shall specify:
    (1) The issue or issues to be reviewed;
    (2) The form in which submissions shall be made by the parties 
(e.g., briefs);
    (3) The time within which such submissions shall be made.
    (f) All documents submitted to the Board shall be filed with the 
Administrative Review Board, Room S-4309, U.S. Department of Labor, 
Washington, DC 20210. An original and two copies of all documents shall 
be filed. Documents are not deemed filed with the Board until actually 
received by the Board. All documents, including documents filed by mail, 
shall be received by the Board either on or before the due date.
    (g) Copies of all documents filed with the Board shall be served 
upon all other parties involved in the proceeding. Service upon the 
Administrator shall be in accordance withSec. 655.830(b).
    (h) The Board's final decision shall be issued within 180 calendar 
days from the date of the notice of intent to review. The Board's 
decision shall be served upon all parties and the administrative law 
judge.
    (i) Upon issuance of the Board's decision, the Board shall transmit 
the entire record to the Chief Administrative Law Judge for custody 
pursuant toSec. 655.850.

[65 FR 80237, Dec. 20, 2000]



Sec.  655.850  Who has custody of the administrative record?

    The official record of every completed administrative hearing 
procedure provided by subparts H and I of this part shall be maintained 
and filed under the custody and control of the Chief Administrative Law 
Judge. Upon receipt of a complaint seeking review of the final agency 
action in a United States District Court, the Chief Administrative Law 
Judge shall certify the official record and shall transmit such record 
to the clerk of the court.



Sec.  655.855  What notice shall be given to the Employment and 
Training Administration and the DHS of the decision regarding 
violations?

    (a) The Administrator shall notify the DHS and ETA of the final 
determination of any violation requiring that the DHS not approve 
petitions filed by an employer. The Administrator's notification will 
address the type of violation committed by the employer and the 
appropriate statutory period for disqualification of the employer from 
approval of petitions. Violations requiring notification to the DHS are 
identified inSec. 655.810(f).
    (b) The Administrator shall notify the DHS and ETA upon the earliest 
of the following events:
    (1) Where the Administrator determines that there is a basis for a 
finding of violation by an employer, and no timely request for hearing 
is made pursuant toSec. 655.820; or
    (2) Where, after a hearing, the administrative law judge issues a 
decision and order finding a violation by an employer, and no timely 
petition for review is filed with the Department's Administrative Review 
Board (Board) pursuant toSec. 655.845; or
    (3) Where a timely petition for review is filed from an 
administrative law judge's decision finding a violation and the Board 
either declines within 30 days to entertain the appeal, pursuant to 
Sec.  655.845(c), or the Board reviews and affirms the administrative 
law judge's determination; or
    (4) Where the administrative law judge finds that there was no 
violation by an employer, and the Board, upon review, issues a decision 
pursuant to

[[Page 701]]

Sec.  655.845, holding that a violation was committed by an employer.
    (c) The DHS, upon receipt of notification from the Administrator 
pursuant to paragraph (a) of this section, shall not approve petitions 
filed with respect to that employer under sections 204 or 214(c) of the 
INA (8 U.S.C. 1154 and 1184(c)) for nonimmigrants to be employed by the 
employer, for the period of time provided by the Act and described in 
Sec.  655.810(f).
    (d) ETA, upon receipt of the Administrator's notice pursuant to 
paragraph (a) of this section, shall invalidate the employer's labor 
condition application(s) under this subpart I and subpart H of this 
part, and shall not accept for filing any application or attestation 
submitted by the employer under 20 CFR part 656 or subparts A, B, C, D, 
E, H, or I of this part, for the same calendar period as specified by 
the DHS.

[65 FR 80238, Dec. 20, 2000]



  Subpart J_Attestations by Employers Using F-1 Students in Off-Campus 
                                  Work

    Source: 56 FR 56865, 56876, Nov. 6, 1991, unless otherwise noted.



Sec.  655.900  Purpose, procedure and applicability of subparts
J and K of this part.

    (a) Purpose. The Immigration Act of 1990 (Act) at section 221 
creates a three-year work authorization program beginning October 1, 
1991, for aliens admitted as F-1 students described in subparagraph (F) 
of section 101 (a)(15) of the Immigration and Nationality Act. 8 U.S.C. 
1101(a)(15)(F). The Act specifies that the Attorney General shall grant 
an alien authorization to be employed in a position unrelated to the 
alien's field of study (i.e., a position not involving curricular or 
post-graduate practical training) and off-campus if:
    (1) The alien has completed one year of school as an F-1 student and 
is maintaining good academic standing at the educational institution;
    (2) The employer provides the educational institution and the 
Secretary of Labor with an attestation regarding recruitment and rate of 
pay specified in paragraph (b) of this section; and
    (3) The alien will not be employed more than 20 hours each week 
during the academic term (but may be employed on a full-time basis 
during vacation periods and between academic terms).

Subpart J of this part sets forth the procedure for filing attestations 
with the Department of Labor (the Department or DOL) for employers who 
seek to use F-1 students for off-campus work. Subpart K of this part 
sets forth complaint, investigation, and disqualification provisions 
with respect to such attestations.
    (b) Procedure. (1) An employer must comply with the following 
procedure in order to hire F-1 students for off-campus employment:
    (i) Recruit for 60 days before filing an attestation;
    (ii) File the attestation with the DOL and the Designated School 
Official (DSO) of the educational institution before hiring any F-1 
student(s);
    (iii) Hire F-1 student(s) during the 90-day period following the 
last day of the recruitment period; and
    (iv) Initiate a new 60-day recruitment effort in order to hire any 
F-1 student(s), under the valid attestation, after the 90-day hiring 
period. (A job order placed with the SESA as part of the employer's 
initial recruitment which remains ``open'' with the SESA shall satisfy 
the requirement regarding a new 60-day recruitment effort.)
    (2) The employer's attestation shall state that the employer:
    (i) Has recruited unsuccessfully for at least 60 days for the 
position and will recruit for 60 days for each position in which an F-1 
student is hired under that attestation until September 30, 1996; and
    (ii) Will provide for payment to the alien and to other similarly 
situated workers at a rate not less than the actual wage for the 
occupation at the place of employment, or if greater, the prevailing 
wage for the occupation in the area of intended employment.
    (3) The employer shall file the attestation with the Designated 
School Official (DSO) of each educational institution from which it 
seeks to hire F-1 students. In fulfilling this requirement,

[[Page 702]]

the employer may file the attestation initially:
    (i) With the appropriate Regional Office of ETA only; or
    (ii) Simultaneously with the DSO and the appropriate Regional Office 
of ETA.

In either instance, under paragraph (b)(3) of this section, ETA will 
return to the employer a copy of the attestation with ETA's acceptance 
indicated thereon. The employer must then send a copy of each accepted 
attestation to the DSO. Where the employer has chosen to file the 
attestation simultaneously with DOL and the DSO, as described in 
paragraph (b)(3)(ii) of this section, the employer shall provide a copy 
of the accepted attestation to the DSO within 15 days after receiving 
the accepted attestation from DOL. The employer shall also retain the 
accepted attestation and produce it in the event the Department conducts 
an investigation to determine if the employer has made an attestation 
that is materially false or has failed to pay wages in accordance with 
the attestation. In no case may an employer hire an F-1 student for off-
campus employment without first filing an attestation with DOL and the 
DSO. The employer may not file the attestation with the DSO before it is 
filed with DOL or in the absence of filing the attestation with DOL. The 
DSO may treat an attestation as accepted for filing by DOL for the 
purpose of authorizing F-1 student employment upon its receipt by the 
school.
    (4) The employer may file an attestation for one or more openings in 
the same occupation, or one or more positions in more than one 
occupation, provided that all occupations are listed on the attestation 
and all positions are located within the same geographic area of 
intended employment.
    (5) The attestation shall be deemed ``accepted for filing'' on the 
date it is received by DOL. Where the attestation is not completed as 
set forth atSec. 655.940(f)(1) of this part, it shall be returned to 
the employer which will have 15 days to correct the deficiency or it 
will be rejected. If the attestation is rejected, DOL will notify INS. 
Attestations deemed unacceptable underSec. 655.940(f)(2) of this part 
may not be resubmitted.
    (c) Applicability. Subparts J and K of this part apply to all 
employers who seek to employ F-1 students in off-campus work in 
positions unrelated to their field(s) of study.
    (d) Final date. ETA will not accept attestations under this program 
after September 30, 1996.
    (e) Revalidation of employer attestations in effect on November 30, 
1995. Any employer's attestation which was valid on November 30, 1995, 
is revalidated effective on November 30, 1995, and shall remain valid 
through September 30, 1996, unless withdrawn or invalidated.

[56 FR 56865, 56876, Nov. 6, 1991, as amended at 59 FR 64776, 64777, 
Dec. 15, 1994; 60 FR 61210, 61211, Nov. 29, 1995]



Sec.  655.910  Overview of process.

    This section provides a context for the attestation process to 
facilitate understanding by employers that seek to employ F-1 students 
in off-campus work.
    (a) Department of Labor's responsibilities. The Department of Labor 
(DOL) administers the attestation process. Within DOL, the Employment 
and Training Administration (ETA) shall have responsibility for 
accepting and filing employer attestations on behalf of F-1 students; 
the Employment Standards Administration (ESA) shall be responsible for 
conducting any investigations concerning such attestations.
    (b) Employer attestation responsibilities. Prior to hiring any F-1 
student(s) for off-campus employment, an employer must submit an 
attestation on Form ETA-9034, as described inSec. 655.940 of this 
part, to the Employment and Training Administration (ETA) of DOL at the 
address set forth atSec. 655.930 of this part.
    (1) The attesting employer shall file the attestation with the 
Designated School Official (DSO) of each educational institution from 
which it seeks to hire F-1 students. If the employer is filing the 
attestation with the DSO simultaneously to filing it with DOL, or prior 
to DOL's accepting it, the employer must provide the DSO with a copy of 
the accepted attestation

[[Page 703]]

within 15 days after receiving the attestation from DOL.
    (2)(i) Each attestation shall be valid through September 30, 1996. 
Throughout the validity period of the attestation, the employer may hire 
F-1 students as needed, during the 90-day period immediately following 
each 60-day recruitment period, for the positions specified on Form ETA-
9034, at the required wage rate, from any educational institution in the 
geographic area of intended employment. In order to employ F-1 students 
in any occupation(s) different from the occupation(s) specified in the 
attestation, the employer shall file a new attestation with ETA.
    (ii) The employer shall have the burden of proving the truthfulness 
and accuracy of each attestation element in the event that such 
attestation element is challenged in an investigation.
    (iii) Substantiating documentation in support of each attestation 
element must be maintained by the employer and shall be made available 
to DOL for inspection and copying upon request. If the employer 
maintains the specific documentation recommended in appendix A of this 
subpart, and the documentation is found to be truthful, accurate, and 
substantiates compliance, it shall meet the burden of proof. If the 
employer chooses to support its attestation in a manner other than in 
accordance with appendix A of this subpart, the employer's documentation 
must be of equal probative value to that shown in appendix A of this 
subpart in the event of an investigation.
    (c) Designated School Official (DSO) responsibilities. The 
Department notes that the basic responsibilities of the DSO are outlined 
in INS regulations at 8 CFR 214.2(f).
    (1) DOL understands INS regulations to mean that the DSO at the 
educational institution is expected to assure that, prior to authorizing 
the off-campus employment of any F-1 student(s):
    (i) It has received an attestation from the prospective employer;
    (ii) The prospective employer has not been disqualified from 
participation in the F-1 student work authorization program (Employers 
disqualified from participation in the program are listed in the Federal 
Register. SeeSec. 655.950(b) of this part); and
    (iii) The F-1 student(s) has completed one year of study and is 
maintaining good academic standing at the institution.
    (2) It is also understood that the DSO will not authorize F-1 
student(s) to work in excess of 20 hours per week during the academic 
term, and that the DSO shall notify ETA when the employer of F-1 
student(s) has not provided the educational institution with an accepted 
copy of the attestation within 90 days of its receipt of the attestation 
from the employer.
    (d) Complaints. (1) Complaints alleging that an attestation is 
materially false or that wages were not paid in accordance with the 
attestation may be filed by any aggrieved party with the Wage and Hour 
Division (Administrator), of the Employment Standards Administration, 
DOL, according to the procedures set forth in subpart K of this part.
    (i) Examples of violations that may be alleged in a complaint 
include:
    (A) The employer failed to pay an F-1 student the prevailing wage 
for the occupation in the area of intended employment;
    (B) The employer failed to pay the actual wage for the position(s) 
at the employer's place of business; or
    (C) The employer's recruitment efforts demonstrated that qualified 
U.S. workers were available for the position(s) filled by F-1 students.
    (ii) The Administrator shall review the allegations contained in the 
complaint to determine if there are reasonable grounds to conduct an 
investigation. If, after investigation, the Administrator finds a 
violation, the Administrator shall disqualify the employer (after notice 
and opportunity for a hearing) from employing F-1 students and shall so 
notify INS.
    (2) Complaints alleging that an F-1 student is not maintaining the 
required academic standing or is working in excess of the authorized 
number of hours of employment per week shall be filed with the INS.
    (e) Termination of program. The pilot F-1 student visa program of 
section 221 of the Immigration Act of 1990 expires

[[Page 704]]

after September 30, 1996, and the Department of Labor will not accept 
any further employer attestations after that date. 8 U.S.C. 1184 note. 
However, complaints and appeals arising out of actions occurring prior 
to September 30, 1996, will continue to be received, investigated, and 
processed under the standards and procedures of subparts J and K of this 
part. Therefore, subparts J and K of this part remain in effect through 
the completion of such enforcement.

[56 FR 56865, 56876, Nov. 6, 1991, as amended at 59 FR 64777, Dec. 15, 
1994; 60 FR 61210, 61211, Nov. 29, 1995]



Sec.  655.920  Definitions.

    For the purposes of subparts J and K of this part:
    Accepted for filing means that an attestation submitted by the 
employer or his designated agent or representative has been received and 
filed by the Employment and Training Administration of the Department of 
Labor.
    Act means the Immigration Act of 1990, as amended.
    Actual wage means the wage rate paid by the attesting employer to 
all similarly situated employees in the occupation at the worksite at 
the time of employment.
    Administrative Law Judge means an official appointed pursuant to 5 
U.S.C. 3105.
    Administrator means the Administrator of the Wage and Hour Division, 
Employment Standards Administration, Department of Labor, or such 
authorized representatives as may be designated to perform any of the 
functions of the Administrator under subparts J and K of this part.
    Area of intended employment means the geographic area within normal 
commuting distance of the place (address) of intended employment. If the 
place of intended employment is within a Metropolitan Statistical Area 
(MSA), any place within the MSA is deemed to be within normal commuting 
distance of the place of intended employment.
    Attestation means a properly completed Form ETA-9034.
    Attesting employer means any employer who has filed an attestation 
required by section 221 of the Act.
    Attorney General means the chief official of the U.S. Department of 
Justice or the Attorney General's designee.
    Chief Administrative Law Judge means the chief official of the 
Office of the Administrative Law Judges of the Department of Labor or 
the Chief Administrative Law Judge's designee.
    Date of filing means the date an attestation is received by ETA as 
indicated by the date stamped on the attestation.
    Department and DOL mean the United States Department of Labor.
    Designated School Official (DSO) means the official of the 
educational institution who has authority to authorize off-campus 
employment of F-1 students pursuant to Immigration and Naturalization 
Service regulations at 8 CFR parts 214 and 274a.
    Educational institution means the educational institution at which 
an alien admitted to the United States as an F-1 student is enrolled in 
a full course of study.
    Employer means a person, firm, corporation, or other association or 
organization, which suffers or permits a person to work; and
    (1) Which has a location within the United States to which U.S. 
workers may be referred for employment, and which proposes to employ 
workers at a place within the United States; and
    (2) Which has an employer-employee relationship with respect to 
employees under subparts J and K of this part, as indicated by the fact 
that it may hire, fire, supervise or otherwise control the work of any 
such employee.
    Employment and Training Administration (ETA) means the agency within 
the Department which includes the United States Employment Service 
(USES).
    Employment Standards Administration (ESA) means the agency within 
the Department which includes the Wage and Hour Division.
    F-1 nonimmigrant student (F-1 student) means an alien who has an F-1 
visa. See 8 U.S.C. 1101(A)(15)(F)(i). lNS grants such a visa to an alien 
who has a residence in a foreign country which he/she has no intention 
of abandoning, who is a bona fide student qualified to pursue a full 
course of study and who entered the United States temporarily and solely 
for the purpose of pursuing

[[Page 705]]

such a course of study at an established institution of learning or 
other recognized place of study in the United States, particularly 
designated by him/her and approved by the Attorney General after 
consultation with the Department of Education of the United States. For 
purposes of subparts J and K, the term ``F-1 student'' shall refer to F-
1 student(s) who will be employed in off-campus employment unrelated to 
their field(s) of study.
    Immigration and Naturalization Service (lNS) means the component of 
the Department of Justice which administers the Department of Justice's 
principal functions under the Act.
    INA means the Immigration and Nationality Act, as amended, 8 U.S.C. 
1101 et seq.
    Independent authoritative source means a professional, business, 
trade, educational or governmental association, organization, or other 
similar entity, not owned or controlled by the employer, which has a 
recognized expertise in the occupational field.
    Independent authoritative source survey means a survey of wages 
conducted by an independent authoritative source and published in a 
book, newspaper, periodical, looseleaf service, newsletter, or other 
similar medium, within the 24-month period immediately preceding the 
filing of the employer's attestation and each succeeding annual 
prevailing wage update. Such survey shall:
    (1) Reflect the average wage paid to workers similarly employed in 
the area of intended employment;
    (2) Be based upon recently collected data--e.g., within the 24-month 
period immediately preceding the date of publication of the survey; and
    (3) Represent the latest published prevailing wage finding by the 
authoritative source for the occupation in the area of intended 
employment.
    Position means a single job opening in an occupation for which the 
attesting employer has recruited and either proposes to fill or has 
filled with an F-1 student.
    Regional Certifying Officer means the official in the Employment and 
Training Administration in a Department of Labor regional office (or 
his/her designee) who is authorized to act on labor certifications and 
employment attestations on behalf of the Secretary of Labor.
    Required wage rate means the rate of pay which is the higher of:
    (1) The actual establishment wage rate for the occupation in which 
the F-1 student is to be (or is) employed; or
    (2) The prevailing wage rate (adjusted on an annual basis) for the 
occupation in which the F-1 student is to be (or is) employed in the 
geographic area of intended employment.
    Secretary means the Secretary of Labor or the Secretary's designee.
    United States is defined at 8 U.S.C. 1101(a)(38).
    United States (U.S.) worker means any U.S. citizen or alien who is 
legally permitted to work indefinitely within the United States.



Sec.  655.930  Addresses of Department of Labor regional offices.

Region I (Connecticut, Maine, Massachusetts, New Hampshire, Rhode 
Island, and Vermont): One Congress Street 10th Floor, Boston, MA 02114-
2021. Telephone: 617-565-4446.
Region II (New York, New Jersey, Puerto Rico, and the Virgin Islands): 
201 Varick Street, room 755, New York, NY 10014. Telephone: 212-660-
2185.
Region III (Delaware, District of Columbia, Maryland, Pennsylvania, 
Virginia, and West Virginia): Post Office Box 8796, Philadelphia, PA 
19101. Telephone: 215-596-6363.
Region IV (Alabama, Florida, Georgia, Kentucky, Mississippi, North 
Carolina, South Carolina, and Tennessee): 1371 Peachtree Street, NE., 
Atlanta, GA 30309. Telephone: 404-347-3938.
Region V (Illinois, Indiana, Michigan, Minnesota, Ohio, and Wisconsin): 
230 South Dearborn Street, room 605, Chicago, IL 60604. Telephone: 312-
353-1550.
Region VI (Arkansas, Louisiana, New Mexico, Oklahoma, and Texas): 525 
Griffin Street, room 314, Dallas, TX 75202. Telephone: 214-767-4989.
Region VII (Iowa, Kansas, Missouri, and Nebraska) 911 Walnut Street, 
Kansas City, MO 64106. Telephone: 816-426-3796.
Region VIII (Colorado, Montana, North Dakota, South Dakota, Utah, and 
Wyoming) 1961 Stout Street, 16th Floor, Denver, CO 80294. Telephone: 
303-844-4613.
Region IX (Arizona, California, Guam, Hawaii, and Nevada) 71 Stevenson 
Street, room 830, San Francisco, CA 94119. Telephone: 415-744-6647.
Region X (Alaska, Idaho, Oregon, and Washington) 1111 Third Avenue, room 
900, Seattle, WA 98101. Telephone: 206-553-5297.


[[Page 706]]


    The telephone numbers set forth in this section are not toll-free.



Sec.  655.940  Employer attestations.

    (a) Who may submit attestations? An employer (or the employer's 
designated agent or representative) seeking to employ F-1 student(s) for 
off-campus work shall submit an attestation on Form ETA-9034. The 
attestation shall be signed by the employer (or the employer's 
designated agent or representative). For this purpose, the employer's 
authorized agent or representative shall mean an official of the 
employer who has the legal authority to commit the employer to the terms 
and conditions of F-1 student attestations.
    (b) Where and when should attestations be submitted? (1) 
Attestations shall be submitted, by U.S. mail, private carrier, or 
facsimile transmission, to the appropriate ETA Regional office, as 
defined inSec. 655.920 of this part, not later than 60 days after the 
employer's recruitment period (see paragraph (d) of this section) has 
ended and shall be accepted for filing, returned, or rejected by ETA in 
accordance with paragraph (f) of this section.
    (2) Attestations shall also be submitted to the Designated School 
Official (DSO) at each educational institution from which the employer 
seeks to hire any F-1 student(s). Attestations may be filed 
simultaneously with ETA and the DSO, or the employer may file the 
approved attestation with the DSO. However, in no case shall the 
employer file the attestation with the DSO before filing the attestation 
with ETA or in the absence of filing the attestation with ETA.
    (3) If the attestation is submitted simultaneously with ETA and the 
DSO, and ETA does not receive its copy of the attestation, the 
Administrator, for purposes of enforcement proceedings under subpart K 
of this part, shall consider that the attestation was accepted for 
filing by ETA as of the date the attestation is received by the DSO.
    (c) What should be submitted? (1) Form ETA-9034. One completed and 
dated original Form ETA-9034 (or a facsimile), containing the 
attestation elements referenced in paragraphs (d) and (e) of this 
section, and the original signature (or a facsimile of the original 
signature) of the employer (or the employer's authorized agent or 
representative) and one copy of Form ETA-9034 shall be submitted to ETA. 
Each attestation form shall identify the position(s) for which the 
attestation is provided, state the occupational division in which the 
position is located, by Dictionary of Occupational Titles (DOT) Two-
Digit Occupational Divisions code, and shall state the rate(s) of pay 
for the position(s). The DOT Two-Digit Occupational Division code is 
required for DOL recordkeeping and reporting purposes only and should 
not be used by the employer to determine the prevailing wage, as it is 
too general for this purpose. (Copies of Form ETA-9034 are available at 
the addresses listed inSec. 655.930 of this part). When an employer 
has filed an attestation by facsimile transmission, the employer shall 
retain in its files the original of the attestation which contains the 
employer's original signature.
    (2) The employer may file an attestation for a single position or 
for multiple positions in the same occupation, or in multiple 
occupations, provided that all positions are located within the same 
geographic area of intended employment.
    (3) If the employer files the attestation simultaneously with ETA 
and the DSO, or files the attestation first with ETA and subsequently 
files with the DSO before an accepted copy is returned from ETA to the 
employer, the employer shall, within fifteen days of receipt of ETA's 
notification of acceptance of the attestation for filing, provide an 
exact copy of the accepted attestation to the DSO at each educational 
institution from which the employer seeks to employ an F-1 student. The 
DSO shall notify ETA if the educational institution has not been 
provided with a copy of the attestation indicating that it was accepted 
for filing by ETA within 90 days from the date that the attestation was 
filed with the DSO.
    (4) Attestation elements. The attestation elements referenced in 
Sec.  655.940 (d) and (e) of this section are mandated by section 
221(a)(2) of the Act (8 U.S.C. 1184 note). Section 221(a)(2) of the Act 
provides that one of the conditions for

[[Page 707]]

the Attorney General to grant F-1 students work authorization, as 
described in INA section 101(a)(15)(F), to be employed off-campus in 
positions unrelated to their field of study, is that the employer 
provides the educational institution and the Secretary with an 
attestation that the employer:
    (i) Has recruited for at least 60 days for the position; and
    (ii) Will pay the F-1 student and all other similarly situated 
workers at a rate not less than the ``required wage rate'' (seeSec. 
655.920 of this part).
    (d) The first attestation element: 60-day recruitment. An employer 
seeking to employ an F-1 student shall attest on Form ETA-9034 that it 
has recruited for at least 60 days for the position(s) and that a 
sufficient number of U.S. workers were not able, qualified, and 
available for the position(s).
    (1) Establishing the 60-day recruitment requirement. (i) The first 
attestation element is demonstrated if the employer attests that:
    (A) It has recruited unsuccessfully for U.S. workers for at least 60 
days for the position prior to filing the attestation; and
    (B) It will conduct at least 60 days of unsuccessful recruitment for 
U.S. workers for each position in which, and at each time at which 
(until September 30, 1996), an F-1 student is subsequently employed.
    (ii) To satisfy paragraph (d)(1)(i)(A) of this section, the employer 
shall recruit for the position for 60 consecutive days by posting the 
job vacancy (or help wanted) notice at the worksite and by placing a job 
order with the State Employment Service agency (SESA) local office which 
services the worksite.
    (iii) To satisfy paragraph (d)(1)(i)(B) of this section, the 
employer shall either:
    (A) Recruit for each position vacancy in the manner required by 
paragraph (d)(1)(ii) of this section; or
    (B) File an ``open job order'' with the SESA local office which 
services the worksite. The employer shall accept referrals from the SESA 
local office on the ``open job order''.
    (2) Documenting the first attestation element. In the event of an 
investigation, the employer shall have the burden of proving that it has 
complied with the elements described in paragraph (d)(1) of this section 
and attested to on ETA Form 9034. Documentation that is truthful, 
accurate and substantiates compliance as identified in Appendix A to 
this subpart shall be sufficient to meet the employer's burden of proof. 
The employer retains the right to meet its burden of proof in proving 
its attestation through other sufficient means.
    (i) Documentation shall not be submitted to ETA or to the DSO with 
the attestation, but employers must be able to produce sufficient 
documentary evidence to substantiate the attestation in the event of an 
investigation. Such documentation shall be made available to DOL as 
described in Sec.Sec. 655.900(b)(3) and 655.1000(c) of this part.
    (ii) Because complaints may be filed and enforcement proceedings may 
be conducted during a considerable period after the recruitment, the 
employer should be able to produce such substantiating documentary 
evidence for a period of no less than 18 months after the close of the 
recruitment period or, in the event of an investigation, for the period 
of the enforcement proceeding under subpart K of this part.
    (e) The second attestation element: wages. An employer seeking to 
employ F-1 students shall state on Form ETA-9034 that it will pay the F-
1 student(s) and other similarly employed worker(s) the ``required wage 
rate'' as defined inSec. 655.920 of this part. For purposes of this 
paragraph ``similarly employed'' shall mean employees of the employer 
working in the same positions under like conditions, such as the same 
shift on the same days of the week. Neither the actual wage rate nor a 
prevailing wage determination for attestation purposes made pursuant to 
this section shall permit an employer to pay a wage lower than that 
required under any other Federal, State, or local law.
    (1) Establishing the wage requirement. The second attestation 
element shall be satisfied when the employer signs Form ETA-9034, 
attesting that for the validity period of the attestation the ``required 
wage rate'' will be paid to the F-1 student(s) and other similarly

[[Page 708]]

situated workers; that is, that the wage will be no less than the actual 
wage rate paid to workers similarly employed at the worksite, or the 
prevailing wage (adjusted on an annual basis) for the occupation in the 
area of intended employment, whichever is higher. The employer's 
obligation to pay the ``required wage rate'' for the position(s) named 
in the attestation shall continue throughout the validity period of the 
attestation; the employer's determination of the prevailing wage shall 
be updated annually, beginning with the date of the attestation. The 
prevailing wage rate for a position(s) named in the attestation, unless 
the subject of a Davis-Bacon Act or McNamara-O'Hara Service Contract Act 
wage determination described in paragraph (b)(4)(i) of appendix A of 
this subpart or a union contract as described in paragraph (b)(4)(ii) of 
appendix A of this subpart, shall be: The average rate of wages paid to 
workers similarly employed in the area of intended employment. Since it 
is not always feasible to determine such an average rate of wages with 
exact precision, the wage set forth in the application shall be 
considered as meeting the prevailing wage standard if it is within 5 
percent of the average rate of wages. For purposes of this section, 
``similarly employed'' means having substantially comparable jobs in the 
occupational category in the area of intended employment, except that if 
no such workers are employed by employers other than the employer 
applicant in the area of intended employment ``similarly employed'' 
shall mean:
    (i) Having jobs requiring a substantially similar level of skills 
within the area of intended employment; or
    (ii) If there are no substantially comparable jobs in the area of 
intended employment, having substantially comparable jobs with employers 
outside of the area of intended employment.
    (2) Documentation of the second attestation element. In the event of 
a complaint and investigation, the employer shall have the burden of 
proving the validity of and compliance with the attestation element 
referenced in paragraph (e)(1) of this section and attested to on ETA 
Form 9034. Documentation that the Department finds to be truthful, 
accurate and substantiates compliance as identified in appendix A of 
this subpart should be sufficient to meet the employer's burden of 
proof. The employer retains the right to meet its burden of proof in 
proving its attestation through other sufficient means.
    (i) Documentation shall not be submitted to ETA or to the DSO with 
the attestation, but the employer must substantiate its attestation with 
appropriate documentation in the event of an investigation. Such 
documentation shall be made available to DOL as described in Sec.Sec. 
655.900(b)(3) and 655.1000(c) of this part.
    (ii) Because complaints may be filed and enforcement proceedings may 
be conducted during a considerable period after the determination the 
employer should be able to produce documentation substantiating its 
attestation for a period of no less than 18 months after the 
determination or update, or in the event of an investigation, for the 
period of the enforcement proceedings under subpart K of this part.
    (f) Actions on attestations submitted for filing. Upon receipt of an 
attestation pursuant to this subpart, the Regional Certifying Officer 
shall determine whether the attestation is properly completed and 
whether there is cause to return the attestation to the employer as 
unacceptable.
    (1) Acceptable attestations. (i) Where all items on Form ETA-9034 
have been completed and the attestation contains the signature of the 
employer or its authorized representative, the Regional Certifying 
Officer, except as provided in paragraph (f)(2)(ii) of this section, 
shall accept the attestation for filing. The Regional Certifying Officer 
shall return a copy of the accepted attestation to the employer or the 
employer's designated agent or representative, with ETA's acceptance 
indicated thereon. An attestation which is properly filled out in 
accordance with this section shall be deemed accepted for filing as of 
the date it is received by ETA as indicated by the date stamped thereon.
    (ii) The employer shall file a copy of the accepted attestation with 
the DSO at the educational institution pursuant toSec. 655.940(c)(3) 
of this part.

[[Page 709]]

    (2) Unacceptable attestations. ETA shall not accept an attestation 
for filing and shall return such attestation as unaccepted to the 
employer or the employer's designated agent or representative, when any 
one of the following conditions exists:
    (i) Form ETA-9034 is not properly completed. Examples of Form ETA-
9034 which is not properly completed include: instances where the 
employer has failed to complete all of the necessary items; or where the 
employer has failed to identify the position(s) or state the rate(s) of 
pay; or where the attestation does not contain the original signature 
(or facsimile of the signature when the attestation is submitted by 
facsimile transmission) of the employer or its authorized 
representative.
    (ii) The Administrator, Wage and Hour Division, after notice and 
opportunity for a hearing pursuant to subpart K of this part, has 
notified ETA in writing that the employer has been disqualified from 
employing F-1 students under section 221 of the Immigration Act.
    (3) If the attestation is not accepted for filing pursuant to 
paragraph (f)(2)(i) of this section, ETA shall return it to the employer 
or the employer's agent or representative with written and dated 
notification of the reason(s) that the attestation is unacceptable. If 
the employer does not complete and return the attestation within 15 days 
of the date of such notification (as stated in paragraph (f)(4) of this 
section), ETA shall invalidate the attestation and shall notify the 
Attorney General of such invalidation. The Attorney General may then use 
such notification in its enforcement responsibilities. Employers shall 
not employ F-1 students without a valid attestation.
    (4) Resubmission. When the attestation is determined to be 
unacceptable and is returned to the employer for completion pursuant to 
paragraph (f)(2)(i) of this section, the employer may resubmit the 
attestation. The employer shall resubmit the attestation within 15 days 
of the date of nonacceptance to avoid the invalidation of its 
attestation and ETA's notice to the Attorney General. Upon resubmission, 
if the attestation is determined to be acceptable pursuant to paragraph 
(f)(1) of this section, the Regional Certifying Officer shall accept the 
attestation for filing as of the original date of receipt by ETA, and 
shall return a copy of the attestation to the employer with ETA's 
acceptance indicated thereon.
    (g) Challenges to Attestations. (1) ETA will not consider, prior to 
the acceptance or return of the attestation, information contesting an 
attestation received by ETA. Such information shall not be made part of 
ETA's administrative record on the attestation, but shall be referred to 
the Administrator to be processed as a complaint pursuant to subpart K 
of this part, and, if such attestation is accepted for filing by ETA, 
the complaint shall be handled by ESA under subpart K of this part.
    (2) DOL is not the guarantor of the accuracy, truthfulness or 
adequacy of an attestation accepted for filing pursuant to this subpart.
    (h) Effective date and validity of filed attestations. (1) A 
properly completed attestation accepted pursuant to paragraph (f)(1) of 
this section shall be deemed accepted for filing as of the date it is 
received and date stamped by the Regional Certifying Officer and shall 
be valid for the duration of the F-1 student work authorization program 
which expires on September 30, 1996, unless withdrawn pursuant to 
paragraph (i) of this section or invalidated pursuant to paragraph (j) 
of this section or subpart K of this part.
    (2) During the validity period of an attestation which has been 
accepted for filing as described in paragraph (f)(1) of this section, 
the attesting employer may hire, during the 90-day period following the 
last day of its 60-day recruitment period, or at any time if the 
employer has placed an ``open job order'' with the SESA as part of their 
recruitment effort, F-1 students as needed from as many educational 
institutions as it deems necessary to fill the positions described in 
the attestation, at the location(s) specified in the attestation, and at 
the ``required wage rate.'' The employer shall provide a copy of the 
accepted attestation to the DSO at each educational institution from 
which it hires any F-1 student(s).

[[Page 710]]

    (3) The DSO may grant work authorization for an F-1 student to be 
employed by a particular attesting employer for the duration of the F-1 
student's course of study or until September 30, 1996, whichever period 
is shorter, provided the F-1 student continues to be employed by the 
attesting employer and is otherwise eligible for F-1 student work 
authorization as determined by the Attorney General.
    (i) Withdrawal of accepted attestations. (1) An employer who has 
submitted an attestation which has been accepted for filing may withdraw 
such attestation at any time before the expiration of the validity 
period of the attestation, unless the Administrator has found reasonable 
cause to commence an investigation of the attestation under subpart K of 
this part. Requests for such withdrawals shall be in writing and shall 
be directed to the Regional Certifying Officer with whom the attestation 
was filed.
    (2) Upon the Regional Certifying Officer's receipt of an employer's 
written request to withdraw an attestation, it shall be the employer's 
responsibility to promptly notify the DSO at each school where F-1 
students it employs are enrolled.
    (3) Withdrawal of an attestation shall not affect an employer's 
liability with respect to any failure to meet the conditions attested to 
which took place before the withdrawal, or for material 
misrepresentations in an attestation. However, if an employer has not 
yet employed any F-1 student(s) pursuant to the attestation, the 
Administrator shall not find reasonable cause to investigate unless it 
is alleged, and there is reasonable cause to believe, that the employer 
has made material misrepresentations in the attestation.
    (j) Invalidation of filed attestation. Invalidation of an 
attestation may result from enforcement action(s) by the Administrator, 
Wage and Hour Division, under subpart K of this part (i.e., 
investigation(s) conducted by the Administrator regarding the employer's 
material misrepresentation of an attestation element or failure to pay 
wages in accordance with attestation). Invalidation of an attestation 
may also result where ETA determines that the attestation is 
unacceptable and the employer fails to resubmit the attestation to ETA 
within 15 days.
    (1) Result of Wage and Hour Division action. Upon a determination of 
a violation under subpart K of this part, the Administrator shall notify 
ETA and shall notify the Attorney General of the violation and of the 
Administrator's notice to ETA.
    (2) Result of ETA action. If, after accepting an attestation for 
filing, ETA finds that it is unacceptable because it falls within one of 
the categories set forth at paragraph (f)(2)(i) of this section, ETA 
shall return the attestation to the employer for correction and 
resubmission within 15 days. If the employer fails to resubmit the 
attestation within 15 days of the date of the notification, ETA shall 
invalidate the attestation. ETA shall notify the Attorney General of 
such invalidation. Where the attestation has been invalidated, ETA shall 
return a copy of the attestation form to the employer, or the employer's 
agent or representative, and shall notify the employer in writing of the 
reason(s) that the attestation is invalidated. When an attestation is 
invalidated pursuant to paragraph (f)(2)(ii) of this section, ETA shall 
invalidate all attestations filed by the employer. Such action shall be 
the final decision of the Secretary of Labor and is not subject to 
appeal.
    (k) Employers subject to disqualification. No attestation shall be 
accepted for filing from an employer which has been found to be 
disqualified from participation in the F-1 student work authorization 
program as determined in a final agency action following an 
investigation by the Administrator pursuant to subpart K of this part.

(Approved by the Office of Management and Budget under control number 
1205-0315)

[56 FR 56865, 56876, Nov. 6, 1991, as amended at 59 FR 64777, Dec. 15, 
1994; 60 FR 61210, 61211, Nov. 29, 1995]



Sec.  655.950  Public access.

    (a) Public examination at ETA. ETA shall compile and maintain a list 
of employers who filed attestations specifying the occupation(s), 
geographical location, and wage rate(s) attested to. The list shall be 
available for public inspection at the ETA office at which the

[[Page 711]]

attestation was filed and such list shall be updated monthly.
    (b) Notice to Public. ETA shall publish semiannually a list in the 
Federal Register of employers which have been disqualified from 
participating in the F-1 student work authorization program pursuant to 
Sec.  655.940(k) of this part.



 Sec. Appendix A to Subpart J of Part 655--Documentation in Support of 
                     Attestations Made by Employers

    This appendix sets forth the documentation that the Department of 
Labor considers to be sufficient to satisfy the employer's burden of 
proof regarding substantiate attestations made on Form ETA-9034, 
pursuant to subpart J of this part, provided the documentation is found 
to be truthful, accurate, and substantiates compliance. The employer 
retains the right to meet its burden of proof in proving its 
attestations through other sufficient means. The employer's failure to 
substantiate its attestation in the event of an investigation shall be 
found to be a violation.
    (a) Documenting the first attestation element. The employer shall 
have the burden of proving that it has complied with the recruitment 
requirements described in regulations atSec. 655.940(d)(1) of this 
part and attested to on ETA Form-9034. The employer's failure to satisfy 
the burden of proof through the production of adequate documentation 
shall be found to be a violation.
    (1) Documentation shall not be submitted to ETA or to the DSO with 
the attestation, but shall be made available to DOL as described in 
Sec.Sec. 655.900(b)(3) and 655.1000(c) of this part. To be effective 
in satisfying the burden of proof, the documentation should be 
contemporaneous with the recruitment, not created after the fact and 
particularly not after the commencement of an investigation under 
subpart K of this part.
    (2) Because complaints may be filed and enforcement proceedings may 
be conducted during a considerable period after the recruitment, the 
employer should maintain the documentation for a period of no less than 
18 months after the close of the recruitment period or, in the event of 
an investigation, for the period of the enforcement proceeding under 
subpart K of this part.
    (3) The employer should be able to produce the following 
documentation:
    (i) Evidence that a job order for the position was on file with the 
SESA local office within the area of intended employment for at least 60 
consecutive days. Such evidence of a job order should include the 
employer's contemporaneous written statement setting forth the name and 
address of the SESA office with which the job order was placed; the name 
of the SESA employee with whom the job order was placed; the date on 
which the order was placed; and the dates on which the job order was on 
file with the SESA office.
    (ii) Evidence that a vacancy notice announcing the position was 
posted for 60 consecutive days at the worksite. Evidence should include 
a copy of the notice that was posted at the worksite, the dates when the 
notice was posted, and a description of the specific location at the 
worksite at which the notice was posted.
    (iii) Evidence that a job order for the position was continuously on 
file and ``open'' with the SESA local office within the area of intended 
employment, throughout the validity period of the attestation. Such 
evidence should include the employer's contemporaneous written statement 
setting forth the name and address of the SESA office with which the job 
order was placed; the name of the SESA employee with whom the job order 
was placed; the date on which the order was placed; and the dates on 
which the job order was on file with the SESA office.
    (iv) Evidence that the employer was unsuccessful in recruiting a 
sufficient number of U.S. workers who are able, qualified, and available 
for the position(s) through the SESA job order and the worksite posting 
notice. Such evidence should include a contemporaneous written summary 
of the results of recruitment for each position for which an attestation 
was filed by the employer. Such summary should include:
    (A) The number of job openings in each occupation included in the 
occupation;
    (B) The number of U.S. workers and F-1 students that applied for 
each position;
    (C) The number of U.S. workers that were hired;
    (D) The number of F-1 students that were hired;
    (E) The number of U.S. workers that were not hired; and
    (F) The lawful job-related reason(s) for which each U.S. worker was 
not hired. An example of a job-related reason for which a U.S. worker 
can be rejected for a job opportunity is that the U.S. worker does not 
have the training and experience required for the position.
    (4) Investigations. In the event that an investigation is conducted 
pursuant to regulations at subpart K of this part, concerning whether 
the employer failed to satisfy its recruitment requirement, in that it 
failed to conduct recruitment or to hire qualified U.S. worker(s) for a 
position for which an F-1 student(s) was hired, the Administrator shall 
determine whether the employer has produced documentation sufficient to 
prove the employer's compliance with the attestation requirements.
    (i) Where the focus of the investigation is upon whether recruitment 
was conducted,

[[Page 712]]

the employer shall have satisfied its burden of proof if the 
documentation described in paragraphs (a)(3) (i), (ii), and (iii) of 
this appendix is produced, provided the documentation is found to be 
truthful, accurate and substantiates compliance.
    (ii) Where the focus of the investigation is upon whether the 
employer's recruitment of U.S. workers was unsuccessful because the 
employer declined to hire U.S. worker(s) without lawful reason(s) for 
such action, the employer shall have satisfied the burden of proof if 
the documentation described in paragraph (a)(3)(iv) of this appendix is 
produced, provided that the Administrator has no significant evidence 
which reasonably shows that the employer's recruitment or hiring was 
deficient. In determining whether the employer has demonstrated that 
U.S. workers were rejected for lawful job-related reasons, the 
Administrator may contact ETA which shall provide the Administrator with 
advice as to whether U.S. workers were properly rejected.
    (b) Documentation of the second attestation element. The employer 
shall have the burden of proving the validity of and compliance with the 
attestation element referenced inSec. 655.940(e) of this part and 
attested to on Form ETA-9034.
    (1) The employer shall be prepared to produce documentation 
sufficient to satisfy this requirement. Documentation shall not be 
submitted to ETA or to the DSO with the attestation, but shall be made 
available to DOL as described in Sec.Sec. 655.900(b)(3) andSec. 
655.1000(c) of this part. The documentation specified in paragraphs (b) 
(4) and (5) of this appendix will be sufficient to satisfy the 
employer's burden of proof, provided the documentation is found to be 
truthful, accurate and substantiates compliance upon investigation. The 
employer's failure to satisfy the burden of proof through the production 
of adequate documentation shall be found to be a violation.
    (2) To be effective in satisfying the employer's burden of proof 
regarding the determination of the prevailing wage, the employer's 
documentation should be contemporaneous with the determination or the 
annual update of the prevailing wage, not created after the fact and 
particularly not after the commencement of an investigation under 
subpart K of this part.
    (3) Because complaints may be filed and enforcement proceedings may 
be conducted during a considerable period after the determination or the 
annual update, the employer should be prepared to produce documentation 
for a period of no less than 18 months after the determination or 
update, or in the event of an investigation, for the period of the 
enforcement proceedings under subpart K of this part.
    (4) Documentation described in paragraphs (b) (1) through (3) of 
this appendix should consist of the following:
    (i) If the position is in an occupation which is the subject of a 
wage determination in the area under the provisions of the Davis-Bacon 
Act, 40 U.S.C. 276a et seq., (see 29 CFR part 1) or the McNamara-O'Hara 
Service Contract Act, 41 U.S.C. 351 et seq., (see 29 CFR part 4), an 
excerpt from the wage determination showing the wage rate for the 
occupation in the area of intended employment; or
    (ii) If the position is covered by a union contract which was 
negotiated at arms-length between a union and the employer, an excerpt 
from the union contract showing the wage rate(s) for the occupation(s) 
set forth in the union contract.
    (iii) If position is not covered by the provisions of paragraph 
(b)(4) (i) or (ii) of this appendix, the employers's documentation shall 
consist of:
    (A) A prevailing wage finding from the SESA for the occupation 
within the area of employment; or
    (B) A prevailing wage survey for the occupation in the area of 
intended employment published by an independent authoritative source as 
defined inSec. 655.920 of this part. For purposes of this paragraph 
(b)(4)(iii)(B) ``prevailing wage survey'' means a survey of wages 
published in a book, newspaper, periodical, looseleaf service, 
newsletter, or other similar medium, within the 24-month period 
immediately preceding the filing of the employer's attestation and each 
succeeding annual prevailing wage update. Such survey shall:
    (1) Reflect the average wage paid to workers similarly employed in 
the area of intended employment;
    (2) Be based upon recently collected data, e.g., within the 24-month 
period immediately preceding the date of publication of the survey; and
    (3) Represent the latest published prevailing wage finding by the 
authoritative source for the occupation in the area of intended 
employment.
    (5) The employer should be prepared to produce documentation to 
prove the payment of the required wage, including payroll records, 
commencing on the date on which the employer first employs the F-1 
student, showing the wages paid to employees in the occupation(s) named 
in the attestation at the worksite. Such payroll records maintained in 
accordance with regulations under the Fair Labor Standards Act (see 29 
CFR part 516) would include for each employee in the occupation:
    (i) The rate(s) of pay, including shift differentials, if any;
    (ii) The employee's earnings per pay period;
    (iii) The number of hours worked per week by the employee; and

[[Page 713]]

    (iv) The amount of and reasons for any and all deductions made from 
the employee's wages.
    (6) Investigations. In the event that an investigation is conducted 
pursuant to subpart K of this part, concerning whether the employer made 
a material misrepresentation regarding the required wage or failed to 
pay the required wage, the Administrator shall determine whether the 
employer has produced documentation sufficient to satisfy the burden of 
proof.
    (i) The employer's documentation of the prevailing wage 
determination shall be found to be sufficient where the determination is 
pursuant to the Davis-Bacon Act or Service Contract Act wage 
determination or a SESA determination.
    (ii) Where the employer's prevailing wage determination is based on 
a survey by an independent authoritative source, the Administrator shall 
consider the employer's documentation to be sufficient, provided that it 
satisfies the standards for independent authoritative source surveys and 
is properly applied, and provided further that the Administrator has no 
significant evidence which reasonably shows that the prevailing wage 
finding obtained by the employer from an independent authoritative 
source varies substantially from the wage prevailing for the occupation 
in the area of intended employment. In the event such significant 
evidence shows a substantial variance, the Administrator may contact 
ETA, which shall provide the Administrator with a prevailing wage 
determination, which the Administrator shall use as the basis for the 
determination as to violations. ETA may consult with the appropriate 
SESA to ascertain the prevailing wage applicable to the occupation under 
investigation.

(Approved by the Office of Management and Budget under control number 
1205-0315)



Subpart K_Enforcement of the Attestation Process for Attestations Filed 
         by Employers Utilizing F-1 Students in Off-Campus Work

    Source: 56 FR 56872, 56876, Nov. 6, 1991, unless otherwise noted.



Sec.  655.1000  Enforcement authority of Administrator, Wage and Hour Division.

    (a) The Administrator shall perform all the Secretary's 
investigative and enforcement functions under section 221 of the Act and 
subparts J and K of this part.
    (b) The Administrator shall conduct such investigations as may be 
appropriate and, in connection therewith, enter and inspect such places 
and such records (and make transcriptions or copies thereof), question 
such persons and gather such information as deemed necessary to 
determine compliance with section 221(a) of the Act and subparts J and K 
of this part.
    (c) An employer being investigated pursuant to this subpart shall 
have the burden of proof as to compliance with section 221(a) of the Act 
and the validity of its attestation, and in this regard shall make 
available to the Administrator such records, information, persons, and 
places as the Administrator deems appropriate to copy, transcribe, 
question, or inspect. No employer subject to the provisions of section 
221 of the Act and subparts J and K of this part shall interfere with 
any official of the Department of Labor performing an investigation, 
inspection or law enforcement function pursuant to section 221 of the 
Act or subpart J or K of this part. Any such interference shall be a 
violation of the attestation and subparts J and K of this part, and the 
Administrator may take such further actions as the Administrator deems 
appropriate.
    Note: Federal criminal statutes prohibit certain interference with a 
Federal officer in the performance of official duties. 18 U.S.C. 111 and 
18 U.S.C. 1114.)
    (d) An employer subject to subparts J and K of this part shall at 
all times cooperate in administrative and enforcement proceedings. No 
employer shall intimidate, threaten, restrain, coerce, blacklist, 
discharge, or in any manner discriminate against any person because such 
person has:
    (1) Filed a complaint or appeal under or related to section 221 of 
the Act or subparts J or K of this part;
    (2) Testified or is about to testify in any proceeding under or 
related to section 221 of the Act or subpart J or K of this part;
    (3) Exercised or asserted on behalf of himself or herself or others 
any right or protection afforded by section 221 of the Act or subpart J 
or K of this part.
    (4) Consulted with an employee of a legal assistance program or an 
attorney on matters related to section 221 of the Act or to subpart J or 
K of this

[[Page 714]]

part or any other DOL regulation promulgated pursuant to section 221 of 
the Act. In the event of any intimidation or restraint as described in 
this section, the conduct shall be a violation of the attestation and 
these regulations, and the Administrator may take such further actions 
as the Administrator considers appropriate.
    (e) The Administrator shall, to the extent possible under existing 
law, protect the confidentiality of any person, including any 
complainant, who provides information to the Department in confidence 
during the course of an investigation or otherwise under subpart J or K 
of this part.



Sec.  655.1005  Complaints and investigative procedures.

    (a) The Administrator, through an investigation, shall determine 
whether an employer of F-1 students has:
    (1) Provided an attestation which is materially false
    Note: Federal criminal statutes provide penalties of up to $10,000 
and/or imprisonment of up to 5 years for knowing and willful submission 
of false statements to the Federal Government. 18 U.S.C. 1001; see also 
18 U.S.C. 1546.
    (2) Failed to pay the appropriate wage rate as required underSec. 
655.940(e) of this part; or
    (3) Failed to comply with the provisions of subpart J or K of this 
part.
    (b) Any aggrieved person or organization may file a complaint 
alleging a violation of the provisions of subpart J or K of this part. 
No particular form is required, except that the complaint shall be 
written or, if oral, shall be reduced to writing by the Wage and Hour 
Division official who receives the complaint. The complaint shall set 
forth sufficient facts for the Administrator to determine whether there 
is reasonable cause to believe that a particular part or parts of the 
attestation or regulations may have been violated. The complaint may be 
submitted to any local Wage and Hour Division office, the addresses of 
which can be found in local telephone directories. The office or person 
receiving such a complaint shall refer it to the office of the Wage and 
Hour Division administering the area in which the reported violation is 
alleged to have occurred.
    (c) The Administrator shall determine whether there is reasonable 
cause to believe that a complaint warrants investigation. If it is 
determined that a complaint fails to present reasonable cause, the 
Administrator shall so notify the complainant, who may submit a new 
complaint with such additional information as may be available. If the 
Administrator determines that reasonable cause exists, an investigation 
will be conducted.
    (d) In the event that the Administrator, after an investigation, 
determines that the employer has committed any violation(s) described in 
paragraph (a) of this section, the Administrator shall issue a written 
determination to the employer in accordance withSec. 655.1015 of this 
part and an opportunity for a hearing shall be afforded in accordance 
with the procedures specified inSec. 655.1020 of this part.



Sec.  655.1010  Remedies.

    Where the Administrator, after notice and opportunity for a hearing, 
determines that an employer has committed a violation identified in 
Sec.  655.1005(a) of this part, the employer shall be disqualified from 
employing F-1 student(s) under section 221 of the Act. The Administrator 
shall so notify the Attorney General and ETA pursuant toSec. 655.1055 
of this part. Upon receipt of the Administrator's notice, the Attorney 
General and ETA shall take the action specified inSec. 655.1055 of 
this part, i.e., cancel any existing attestation(s) or work 
authorizations, and shall not accept future attestation(s) or grant new 
work authorization(s) with respect to that employer.



Sec.  655.1015  Written notice and service of Administrator's
determination.

    (a) The Administrator's written determination, issued pursuant to 
Sec.Sec. 655.1005 and 655.1010 of this part, shall be served on the 
employer by personal service or by certified mail at the address of the 
employer or the employer's agent shown on the attestation. Where service 
by certified mail is not accepted by the employer, the Administrator may 
exercise discretion to serve the determination by regular mail.
    (b) The Administrator's written determination, issued pursuant to

[[Page 715]]

Sec.Sec. 655.1005 and 655.1010 of this part, shall:
    (1) Set forth the Administrator's determination of the violation(s) 
and the Administrator's reason or reasons therefor.
    (2) Inform the employer that it may request a hearing pursuant to 
Sec.  655.1020 of this part.
    (3) Inform the employer that in the absence of a timely request for 
a hearing, received by the Chief Administrative Law Judge within 15 
calendar days of the date of the determination, the determination of the 
Administrator shall become final and not appealable.
    (4) Set forth the procedure for requesting a hearing, and give the 
addresses of the Chief Administrative Law Judge (with whom the request 
must be filed) and the representative of the Solicitor of Labor (who 
must be served with a copy of the request).
    (5) Inform the employer that, if no timely request for a hearing is 
filed pursuant toSec. 655.1020 of this part, the employer shall be 
disqualified from employing F-1 students, effective upon the expiration 
of the period for filing a request for a hearing. In such event, the 
Administrator shall, pursuant toSec. 655.1055 of this part, notify ETA 
and the Attorney General of the occurrence of a violation by the 
employer, and that the employer has been disqualified from employing F-1 
students.



Sec.  655.1020  Request for hearing.

    (a) An employer desiring to request an administrative hearing on a 
determination issued pursuant toSec. 655.1015 of this part shall make 
such request in writing to the Chief Administrative Law Judge at the 
address stated in the notice of determination. Copies of the request 
shall be served upon the Wage and Hour Division official who issued the 
notice of determination and upon the representative of the Solicitor of 
Labor identified in the notice of determination.
    (b) No particular form is prescribed for any request for hearing 
permitted by this section. However, any such request shall:
    (1) Be dated;
    (2) Be typewritten or legibly written;
    (3) Specify the issue or issues stated in the notice of 
determination giving rise to such request;
    (4) State the specific reason or reasons why the employer believes 
such determination is in error;
    (5) Be signed by the employer making the request or by an authorized 
representative of the employer; and
    (6) Include the address at which the employer or authorized 
representative desires to receive further communications relating 
thereto.
    (c) The request for such hearing must be received by the Chief 
Administrative Law Judge, at the address stated in the Administrator's 
notice of determination, no later than 15 calendar days after the date 
of the determination.
    (d) The request may be filed in person, by facsimile transmission, 
by certified or regular mail, or by courier service. For the requesting 
party's protection, if the request is by mail, it should be by certified 
mail. If the request is by facsimile transmission, the original of the 
request, signed by the employer or authorized representative, shall be 
filed within ten days thereafter.
    (e) A copy of the request for a hearing shall be sent by the 
requestor to the Administrator at the address shown on the 
Administrator's notice of determination.



Sec.  655.1025  Rules of practice for administrative law judge
proceedings.

    (a) Except as specifically provided in this subpart, and to the 
extent they do not conflict with the provisions of this subpart, the 
``Rules of Practice and Procedure for Administrative Hearings Before the 
Office of Administrative Law Judges'' established by the Secretary at 29 
CFR part 18 shall apply to administrative proceedings under this
    (b) As provided in the Administrative Procedure Act, 5 U.S.C. 556, 
any oral or documentary evidence may be received in proceedings under 
this part. The Federal Rules of Evidence and subpart B of the Rules of 
Practice and Procedure for Administrative Hearings Before the Office of 
Administrative Law Judges (29 CFR part 18, subpart B) shall not apply, 
but principles designed to

[[Page 716]]

ensure production of relevant and probative evidence shall guide the 
admission of evidence. The administrative law judge may exclude evidence 
which is immaterial, irrelevant, or unduly repetitive.



Sec.  655.1030  Service and computation of time.

    (a) Under this subpart, a party may serve any pleading or document 
by regular mail. Service on a party is complete upon mailing to the last 
known address. No additional time for filing or response is authorized 
where service is by mail. In the interest of expeditious proceedings, 
the administrative law judge may direct the parties to serve pleadings 
or documents by a method other than regular mail.
    (b) Two (2) copies of all pleadings and other documents in any 
administrative law judge proceeding shall be served on the attorneys for 
the Administrator. One copy shall be served on the Associate Solicitor, 
Division of Fair Labor Standards, Office of the Solicitor, U.S. 
Department of Labor, 200 Constitution Avenue NW., room N-2716, 
Washington, DC 20210, and one copy on the attorney representing the 
Administrator in the proceeding.
    (c) Time under this subpart shall be computed beginning with the day 
following the action and includes the last day of the period unless it 
is a Saturday, Sunday, or federally-observed holiday, in which case the 
time period includes the next business day.



Sec.  655.1035  Administrative law judge proceedings.

    (a) Upon receipt of a timely request for a hearing filed pursuant to 
and in accordance withSec. 655.1020 of this part, the Chief 
Administrative Law Judge shall promptly appoint an administrative law 
judge to hear the case.
    (b) The date of the hearing shall be not more than 60 calendar days 
from the date of the Chief Administrative Law Judge's receipt of the 
request for hearing.
    (c) The administrative law judge may prescribe a schedule by which 
the parties are permitted to file a prehearing brief or other written 
statement of fact or law. Any such brief or statement shall be served 
upon each other party in accordance withSec. 655.1030 of this part. 
Posthearing briefs shall not be permitted except at the request of the 
administrative law judge. When permitted, any such brief shall be 
limited to the issue or issues specified by the administrative law 
judge, shall be due within the time prescribed by the administrative law 
judge, and shall be served in accordance withSec. 655.1030 of this 
part.
    (d) Amicus curiae participation or intervention by interested 
parties may be permitted by the administrative law judge in his/her 
discretion pursuant to 29 CFR 18.10. If such participation is granted, 
the amicus curiae and/or intervenor shall serve all documents and be 
served by the parties in accordance withSec. 655.1030 of this part. In 
no event, however, shall such participation be permitted to delay the 
proceedings beyond the deadline specified in paragraphs (b) and (c) of 
this section.



Sec.  655.1040  Decision and order of administrative law judge.

    (a) Within 90 calendar days after receipt of the transcript of the 
hearing, the administrative law judge shall issue a decision.
    (b) The decision of the administrative law judge shall include a 
statement of findings and conclusions, with reasons and basis therefore, 
upon each material issue presented on the record. The decision shall 
also include an appropriate order which may affirm, deny, reverse, or 
modify, in whole or in part, the determination of the Administrator; the 
reason or reasons for such order shall be stated in the decision.
    (c) The administrative law judge, in accordance withSec. 655.940 
(d) and (e) of this part, shall impose upon the employer the burden of 
proving the validity of and compliance with the attestation.
    (d) If the administrative law judge finds that the employer has 
failed to pay the required wage rate or has provided an attestation 
which is materially false, the judge shall order that the employer be 
disqualified from employing F-1 students.
    (e) In the event that the Administrator's determination(s) of wage 
violation(s) is based upon a wage determination obtained by the 
Administrator

[[Page 717]]

from ETA during the investigation (paragraph (b)(6) of appendix A of 
subpart J of this part), the administrative law judge shall not 
determine the prevailing wage rate de novo, but shall, based on the 
evidence (including the ETA administrative record), either accept the 
wage determination or vacate the wage determination. If the wage 
determination is vacated, the administrative law judge shall remand the 
case to the Administrator, who may then refer the matter to ETA and, 
upon the issuance of a new wage determination by ETA, resubmit the case 
to the administrative law judge. Under no circumstances shall source 
data obtained in confidence by ETA, or the names of establishments 
contacted by ETA, be submitted into evidence or otherwise disclosed.
    (f) The administrative law judge shall not render determinations as 
to the legality of a regulatory provision or the constitutionality of a 
statutory provision.
    (g) The decision shall be served on all parties in person or by 
certified or regular mail.



Sec.  655.1045  Secretary's review of administrative law judge's 
decision.

    (a) Any party desiring review of the decision and order of an 
administrative law judge shall petition the Secretary to review the 
decision and order. To be effective, such petition must be received by 
the Secretary within 30 calendar days of the date of the decision and 
order. Copies of the petition shall be served on all parties and the 
administrative law judge.
    (b) No particular form is prescribed for any petition for the 
Secretary's review permitted by this subpart. However, any such petition 
shall:
    (1) Be dated;
    (2) Be typewritten or legibly written;
    (3) Specify the issue or issues stated in the administrative law 
judge decision and order giving rise to such petition;
    (4) State the specific reason or reasons why the party petitioning 
for review believes such decision and order are in error;
    (5) Be signed by the party filing the petition or by an authorized 
representative of such party;
    (6) Include the address at which such party or authorized 
representative desires to receive further communications relating 
thereto; and
    (7) Attach copies of the administrative law judge's decision and 
order, and any other record documents which would assist the Secretary 
in determining whether review is warranted.
    (c) Whenever the Secretary determines to review the decision and 
order of an administrative law judge, a notice of the Secretary's 
determination shall be served upon the administrative law judge and all 
parties within 30 calendar days after the Secretary's receipt of the 
petition for review.
    (d) Upon receipt of the Secretary's notice, the Office of 
Administrative Law Judges shall within 15 calendar days forward the 
complete hearing record to the Secretary.
    (e) The Secretary's notice may specify:
    (1) The issue or issues to be reviewed;
    (2) The form in which submissions shall be made by the parties 
(e.g., briefs);
    (3) The time within which such submissions shall be made.
    (f) All documents submitted to the Secretary shall be filed with the 
Secretary of Labor, U.S. Department of Labor, Washington, DC 20210, 
Attention: Executive Director, Office of Administrative Appeals, room S-
4309. An original and two copies of all documents shall be filed. 
Documents are not deemed filed with the Secretary until actually 
received by the Secretary. All documents, including documents filed by 
mail, must be received by the Secretary either on or before the due 
date.
    (g) Copies of all documents filed with the Secretary shall be served 
upon all other parties involved in the proceeding. Service upon the 
Administrator shall be in accordance withSec. 655.1030(b) of this 
part.
    (h) The Secretary's final decision shall be issued within 180 
calendar days from the date of the notice of intent to review. The 
Secretary's decision shall be served upon all parties and the 
administrative law judge.
    (i) Upon issuance of the Secretary's decision, the Secretary shall 
transmit

[[Page 718]]

the entire record to the Chief Administrative Law Judge for custody 
pursuant toSec. 655.1050 of this part.



Sec.  655.1050  Administrative record.

    The official record of every completed administrative hearing 
procedure provided by subpart K of this part shall be maintained and 
filed under the custody and control of the Chief Administrative Law 
Judge. Upon receipt of a complaint seeking review of the final agency 
action in a United States District Court, the Chief Administrative Law 
Judge shall certify the official record and shall transmit such record 
to the clerk of the court.



Sec.  655.1055  Notice to the Employment and Training Administration
(ETA) and the Attorney General (AG).

    (a) The Administrator shall notify the Attorney General and ETA of 
the final determination of a violation by an employer, and of the 
disqualification of the employer from employing F-1 students, upon the 
earliest of the following events:
    (1) When the Administrator issues a written determination that the 
employer has committed a violation, and no timely request for hearing is 
made by the employer pursuant toSec. 655.1020 of this part; or
    (2) When, after a hearing on a timely request pursuant toSec. 
655.1020 of this part, the administrative law judge issues a decision 
and order finding a violation by the employer; or
    (3) When, although the administrative law judge found that there was 
no violation by the employer, the Secretary, upon subsequent review upon 
a timely request pursuant toSec. 655.1045 of this part, issues a 
decision finding that a violation was committed by the employer.
    (b) The Attorney General, upon receipt of notification from the 
Administrator pursuant to paragraph (a) of this section, shall take 
appropriate action to cancel work authorization to F-1 students for 
employment with that employer, and to prevent issuance of new work 
authorization with respect to that employer.
    (1) The Administrator's notice to the Attorney General shall, to the 
extent known from the investigation, specify the school(s) which issued 
work authorization for the F-1 students who were employed by the 
employer. The Attorney General shall inform the appropriate authority at 
each of the specified school(s) that any work authorization(s) issued 
for F-1 student(s) to be employed by that employer shall immediately be 
revoked, and that no new work authorization shall be issued for 
employment of F-1 student(s) by that employer. The Attorney General 
shall, in addition, take any other appropriate action to effectuate the 
disqualification of that employer through revocation of work 
authorization(s) at any other school(s) that may authorize employment 
with the disqualified employer.
    (2) A copy of the Administrator's notice to the Attorney General may 
also be sent by the Administrator to each school identified in the 
notice as a school from which F-1 students have been employed by the 
disqualified employer. Such copy of the Administrator's notice, upon 
receipt by the school, shall constitute sufficient notice for the DSO to 
revoke work authorization(s) and to refuse to issue new work 
authorization(s) for employment of F-1 students by that employer. Any 
school which issued or may issue work authorization(s) for employment of 
any F-1 student(s) by the employer, but which was not known by the 
Administrator to have done so, or notified by copy of the 
Administrator's decision, shall comply with any instructions from the 
Attorney General regarding revocation and nonissuance of work 
authorization for employment of any F-1 student(s) by the employer. In 
addition, any school (whether or not it received a copy of the 
Administrator's notice to the Attorney General regarding the employer) 
shall revoke F-1 work authorization(s) and refuse to issue new F-1 work 
authorization(s) for any employer which is identified as a disqualified 
employer on the list published periodically in the Federal Register by 
ETA.
    (3) Continued or new employment of any F-1 student by the employer 
shall constitute a violation of the INA's employer sanctions provisions, 
irrespective of whether the F-1 student's work

[[Page 719]]

authorization has been formally revoked by the DSO or INS.
    (c) ETA, upon receipt of the Administrator's notice pursuant to 
paragraph (a) of this section, shall cancel any F-1 attestation filed by 
the employer under subpart J of this part, shall not accept for filing 
any attestation submitted by the employer, and shall so notify the 
employer.



Sec.  655.1060  Non-applicability of the Equal Access to Justice Act.

    A proceeding under subpart K of this part is not subject to the 
Equal Access to Justice Act, as amended, 5 U.S.C. 504. In such a 
proceeding, the administrative law judge shall have no authority to 
award attorney fees and/or other litigation expenses pursuant to the 
provisions of the Equal Access to Justice Act.



    Subpart L_What Requirements Must a Facility Meet to Employ H	1C 
               Nonimmigrant Workers as Registered Nurses?

    Source: 65 FR 51149, Aug. 22, 2000, unless otherwise noted.

    Editorial Note: Nomenclature changes to subpart L appear at 75 FR 
10403, Mar. 5, 2010.



Sec.  655.1100  What are the purposes, procedures and applicability of
these regulations in subparts L and M of this part?

    (a) Purpose. The Immigration and Nationality Act (INA), as amended 
by the Nursing Relief for Disadvantaged Areas Act of 1999, establishes 
the H-1C nonimmigrant visa program to provide qualified nursing 
professionals for narrowly defined health professional shortage areas. 
Subpart L of this part sets forth the procedure by which facilities 
seeking to use nonimmigrant registered nurses must submit attestations 
to the Department of Labor demonstrating their eligibility to 
participate as facilities, their wages and working conditions for 
nurses, their efforts to recruit and retain United States workers as 
registered nurses, the absence of a strike/lockout or layoff, 
notification of nurses, and the numbers of and worksites where H-1C 
nurses will be employed. Subpart M of this part sets forth complaint, 
investigation, and penalty provisions with respect to such attestations.
    (b) Procedure. The INA establishes a procedure for facilities to 
follow in seeking admission to the United States for, or use of, 
nonimmigrant nurses under H-1C visas. The procedure is designed to 
reduce reliance on nonimmigrant nurses in the future, and calls for the 
facility to attest, and be able to demonstrate in the course of an 
investigation, that it is taking timely and significant steps to 
develop, recruit, and retain U.S. nurses. Subparts L and M of this part 
set forth the specific requirements of those procedures.
    (c) Applicability. (1) Subparts L and M of this part apply to all 
facilities that seek the temporary admission or use of H-1C 
nonimmigrants as registered nurses.
    (2) During the period that the provisions of Appendix 1603.D.4 of 
Annex 1603 of the North American Free Trade Agreement (NAFTA) apply, 
subparts L and M of this part shall apply to the entry of a nonimmigrant 
who is a citizen of Mexico under the provisions of section D of Annex 
1603 of NAFTA. Therefore, the references in this part to ``H-1C nurse'' 
apply to such nonimmigrants who are classified by USCIS as ``TN.''



Sec.  655.1101  What are the responsibilities of the government
agencies and the facilities that participate in the H-1C program?

    (a) Federal agencies' responsibilities. The Department of Labor 
(DOL), Department of Homeland Security, and Department of State are 
involved in the H-1C visa process. Within DOL, the Employment and 
Training Administration (ETA) and the Wage and Hour Division have 
responsibility for different aspects of the process.
    (b) Facility's attestation responsibilities. Each facility seeking 
one or more H-1C nurse(s) must, as the first step, submit an attestation 
on Form ETA 9081, as described inSec. 655.1110 of this part, to the 
U.S. Department of Labor, Employment and Training Administration, Office 
of Foreign Labor Certification, Chicago National Processing Center, 536 
South Clark Street, Chicago, IL

[[Page 720]]

60605-1509. If the attestation satisfies the criteria stated inSec. 
655.1130 and includes the supporting information required bySec. 
655.1110 and bySec. 655.1114, ETA shall accept the attestation form 
for filing, and return the accepted attestation to the facility.
    (c) H-1C petitions. Upon ETA's acceptance of the attestation, the 
facility may then file petitions with U.S. Citizenship and Immigration 
Services (USCIS) for the admission of, change to, or extension of status 
of H-1C nurses. The facility must attach a copy of the accepted 
attestation (Form ETA 9081) to the petition or the request for 
adjustment or extension of status, filed with USCIS. At the same time 
that the facility files an H-1C petition with USCIS, it must also send a 
copy of the petition to the Employment and Training Administration, 
Administrator, Office of Foreign Labor Certification, 200 Constitution 
Avenue, NW., Room C-4312, Washington, DC 20210. The facility must also 
send to this same ETA address a copy of the USCIS petition approval 
notice within 5 days after it is received from USCIS.
    (d) Visa issuance. USCIS makes determinations, in adjudicating an H-
1C petition, whether the foreign worker possesses the required 
qualifications and credentials to be employed as an H-1C nurse. The 
Department of State is subsequently responsible for determining visa 
eligibility.
    (e) Board of Alien Labor Certification Appeals (BALCA) review of 
Attestations accepted and not accepted for filing. Any interested party 
may seek review by the BALCA of an Attestation accepted or not accepted 
for filing by ETA. However, such appeals are limited to ETA actions on 
the three Attestation matters on which ETA conducts a substantive review 
(i.e., the employer's eligibility as a facility; the facility's 
attestation to alternative timely and significant steps; and the 
facility's assertion that taking a second timely and significant step 
would not be reasonable).
    (f) Complaints. Complaints concerning misrepresentation of material 
fact(s) in the Attestation or failure of the facility to carry out the 
terms of the Attestation may be filed with the Wage and Hour Division of 
DOL, according to the procedures set forth in subpart M of this part. 
The Wage and Hour Administrator shall investigate and, where 
appropriate, after an opportunity for a hearing, assess remedies and 
penalties. Subpart M of this part also provides that interested parties 
may obtain an administrative law judge hearing and may seek review of 
the administrative law judge's decision at the Department's 
Administrative Review Board.

[75 FR 10403, Mar. 5, 2010]



Sec.  655.1102  What are the definitions of terms that are used in
these regulations?

    For the purposes of subparts L and M of this part:
    Accepted for filing means that the Attestation and any supporting 
documentation submitted by the facility have been received by the 
Employment and Training Administration of the Department of Labor and 
have been found to be complete and acceptable for purposes of 
Attestation requirements in Sec.Sec. 655.1110 through 655.1118.
    Administrative Law Judge means an official appointed under 5 U.S.C. 
3105.
    Administrator means the Administrator of the Wage and Hour Division, 
Employment Standards Administration, Department of Labor, and such 
authorized representatives as may be designated to perform any of the 
functions of the Administrator under subparts L and M of this part.
    Administrator, Office of Foreign Labor Certification (OFLC) means 
the primary official of the Office of Foreign Labor Certification (OFLC 
Administrator), or the OFLC Administrator's designee.
    Aggrieved party means a person or entity whose operations or 
interests are adversely affected by the employer's alleged 
misrepresentation of material fact(s) or non-compliance with the 
Attestation and includes, but is not limited to:
    (1) A worker whose job, wages, or working conditions are adversely 
affected by the facility's alleged misrepresentation of material fact(s) 
or non-compliance with the attestation;
    (2) A bargaining representative for workers whose jobs, wages, or 
working conditions are adversely affected by the facility's alleged 
misrepresentation

[[Page 721]]

of material fact(s) or non-compliance with the attestation;
    (3) A competitor adversely affected by the facility's alleged 
misrepresentation of material fact(s) or non-compliance with the 
attestation; and
    (4) A government agency which has a program that is impacted by the 
facility's alleged misrepresentation of material fact(s) or non-
compliance with the attestation.
    Attorney General means the chief official of the U.S. Department of 
Justice or the Attorney General's designee.
    Board of Alien Labor Certification Appeals (BALCA) means a panel of 
one or more administrative law judges who serve on the permanent Board 
of Alien Labor Certification Appeals established by 20 CFR part 656. 
BALCA consists of administrative law judges assigned to the Department 
of Labor and designated by the Chief Administrative Law Judge to be 
members of the Board of Alien Labor Certification Appeals.
    Certifying Officer means a Department of Labor official, or such 
official's designee, who makes determinations about whether or not H-1C 
attestations are acceptable for certification.
    Chief Administrative Law Judge means the chief official of the 
Office of the Administrative Law Judges of the Department of Labor or 
the Chief Administrative Law Judge's designee.
    Date of filing means the date an Attestation is ``accepted for 
filing'' by ETA.
    Department and DOL mean the United States Department of Labor.
    Division means the Wage and Hour Division of the Employment
    Standards Administration, DOL.
    Employed or employment means the employment relationship as 
determined under the common law, except that a facility which files a 
petition on behalf of an H-1C nonimmigrant is deemed to be the employer 
of that H-1C nonimmigrant without the necessity of the application of 
the common law test. Under the common law, the key determinant is the 
putative employer's right to control the means and manner in which the 
work is performed. Under the common law, ``no shorthand formula or magic 
phrase * * * can be applied to find the answer * * *. [A]ll of the 
incidents of the relationship must be assessed and weighed with no one 
factor being decisive.'' NLRB v. United Ins. Co. of America, 390 U.S. 
254, 258 (1968). The determination should consider the following factors 
and any other relevant factors that would indicate the existence of an 
employment relationship:
    (1) The firm has the right to control when, where, and how the 
worker performs the job;
    (2) The work does not require a high level of skill or expertise;
    (3) The firm rather than the worker furnishes the tools, materials, 
and equipment;
    (4) The work is performed on the premises of the firm or the client;
    (5) There is a continuing relationship between the worker and the 
firm;
    (6) The firm has the right to assign additional projects to the 
worker;
    (7) The firm sets the hours of work and the duration of the job;
    (8) The worker is paid by the hour, week, month or an annual salary, 
rather than for the agreed cost of performing a particular job;
    (9) The worker does not hire or pay assistants;
    (10) The work performed by the worker is part of the regular 
business (including governmental, educational and nonprofit operations) 
of the firm;
    (11) The firm is itself in business;
    (12) The worker is not engaged in his or her own distinct occupation 
or business;
    (13) The firm provides the worker with benefits such as insurance, 
leave, or workers' compensation;
    (14) The worker is considered an employee of the firm for tax 
purposes (i.e., the entity withholds federal, state, and Social Security 
taxes);
    (15) The firm can discharge the worker; and
    (16) The worker and the firm believe that they are creating an 
employer-employee relationship.
    Employment and Training Administration (ETA) means the agency within 
the Department of Labor (DOL) which includes the Office of Foreign Labor 
Certification (OFLC).
    Facility means a ``subsection (d) hospital'' (as defined in section 
1886(d)(1)(B) of the Social Security Act

[[Page 722]]

(42 U.S.C. 1395ww(d)(1)(B)) that meets the following requirements:
    (1) As of March 31, 1997, the hospital was located in a health 
professional shortage area (as defined in section 332 of the Public 
Health Service Act (42 U.S.C. 245e)); and
    (2) Based on its settled cost report filed under Title XVIII of the 
Social Security Act (42 U.S.C. 1395 et seq.) for its cost reporting 
period beginning during fiscal year 1994--
    (i) The hospital has not less than 190 licensed acute care beds;
    (ii) The number of the hospital's inpatient days for such period 
which were made up of patients who (for such days) were entitled to 
benefits under part A of such title is not less than 35 percent of the 
total number of such hospital's acute care inpatient days for such 
period; and
    (iii) The number of the hospital's inpatient days for such period 
which were made up of patients who (for such days) were eligible for 
medical assistance under a State plan approved under Title XIX of the 
Social Security Act, is not less than 28 percent of the total number of 
such hospital's acute care inpatient days for such period.
    (3) The requirements of paragraph (2) of this definition shall not 
apply to a facility in Guam, the Commonwealth of the Northern Mariana 
Islands, or the Virgin Islands.
    Full-time employment means work where the nurse is regularly 
scheduled to work 40 hours or more per week, unless the facility 
documents that it is common practice for the occupation at the facility 
or for the occupation in the geographic area for full-time nurses to 
work fewer hours per week.
    Geographic area means the area within normal commuting distance of 
the place (address) of the intended worksite. If the geographic area 
does not include a sufficient number of facilities to make a prevailing 
wage determination, the term ``geographic area'' shall be expanded with 
respect to the attesting facility to include a sufficient number of 
facilities to permit a prevailing wage determination to be made. If the 
place of the intended worksite is within a Metropolitan Statistical Area 
(MSA) or Primary Metropolitan Statistical Area (PMSA), any place within 
the MSA or PMSA will be deemed to be within normal commuting distance of 
the place of intended employment.
    H-1C nurse means any nonimmigrant alien admitted to the United 
States to perform services as a nurse under section 101(a)(15)(H)(i)(c) 
of the Act (8 U.S.C. 1101(a)(15)(H)(i)(c)).
    INA means the Immigration and Nationality Act, as amended, 8
    U.S.C. 1101 et seq.
    Lockout means a labor dispute involving a work stoppage in which an 
employer withholds work from its employees in order to gain a concession 
from them.
    Nurse means a person who is or will be authorized by a State Board 
of Nursing to engage in registered nursing practice in a State or U.S. 
territory or possession at a facility which provides health care 
services. A staff nurse means a nurse who provides nursing care directly 
to patients. In order to qualify under this definition of ``nurse'' the 
alien must:
    (1) Have obtained a full and unrestricted license to practice 
nursing in the country where the alien obtained nursing education, or 
have received nursing education in the United States;
    (2) Have passed the examination given by the Commission on Graduates 
for Foreign Nursing Schools (CGFNS), or have obtained a full and 
unrestricted (permanent) license to practice as a registered nurse in 
the state of intended employment, or have obtained a full and 
unrestricted (permanent) license in any state or territory of the United 
States and received temporary authorization to practice as a registered 
nurse in the state of intended employment; and,
    (3) Be fully qualified and eligible under the laws (including such 
temporary or interim licensing requirements which authorize the nurse to 
be employed) governing the place of intended employment to practice as a 
registered nurse immediately upon admission to the United States, and be 
authorized under such laws to be employed by the employer. For purposes 
of this paragraph, the temporary or interim licensing may be obtained 
immediately after the alien enters the United States and registers to 
take the

[[Page 723]]

first available examination for permanent licensure.
    Office of Foreign Labor Certification (OFLC) means the 
organizational component within the ETA that provides national 
leadership and policy guidance and develops regulations and procedures 
to carry out the responsibilities of the Secretary of Labor under the 
INA concerning foreign workers seeking admission to the United States.
    Prevailing wage means the weighted average wage paid to similarly 
employed registered nurses within the geographic area.
    Secretary means the Secretary of Labor or the Secretary's designee.
    Similarly employed means employed by the same type of facility 
(acute care or long-term care) and working under like conditions, such 
as the same shift, on the same days of the week, and in the same 
specialty area.
    State means one of the 50 States, the District of Columbia, Puerto 
Rico, the U.S. Virgin Islands, and Guam.
    Strike means a labor dispute in which employees engage in a 
concerted stoppage of work (including stoppage by reason of the 
expiration of a collective-bargaining agreement) or engage in any 
concerted slowdown or other concerted interruption of operations.
    United States (U.S.) means the continental U.S., Alaska, Hawaii, the 
Commonwealth of Puerto Rico, and the territories of Guam, the Virgin 
Islands, and the Commonwealth of the Northern Mariana Islands.
    U.S. Citizenship and Immigration Services (USCIS) means the bureau 
within the Department of Homeland Security that makes determinations 
under the INA on whether to approve petitions seeking classification 
and/or admission of nonimmigrant nurses under the H-1C program.
    United States (U.S.) nurse means any nurse who: is a U.S. citizen; 
is a U.S. national; is lawfully admitted for permanent residence; is 
admitted as a refugee under 8 U.S.C. 1157; or is granted asylum under 8 
U.S.C. 1158.
    Worksite means the location where the nurse is involved in the 
practice of nursing.

[65 FR 51149, Aug. 22, 2000, as amended at 73 FR 78068, Dec. 19, 2008; 
75 FR 10404, Mar. 5, 2010]



Sec.  655.1110  What requirements are imposed in the filing of 
an attestation?

    (a) Who may file Attestations?
    (1) Any hospital which meets the definition of facility in 
Sec.Sec. 655.1102 and 655.1111 may file an Attestation.
    (2) ETA shall determine the hospital's eligibility as a facility 
through a review of this attestation element on the first Attestation 
filed by the hospital. ETA's determination on this point is subject to a 
hearing before the BALCA upon the request of any interested party. The 
BALCA proceeding shall be limited to the point.
    (3) Upon the hospital's filing of a second or subsequent 
Attestation, its eligibility as a facility shall be controlled by the 
determination made on this point in the ETA review (and BALCA 
proceeding, if any) of the hospital's first Attestation.
    (b) Where and when should attestations be submitted?
    (1) Attestations shall be submitted, by U.S. mail or private 
carrier, to ETA at the following address: U.S. Department of Labor, 
Employment and Training Administration, Office of Foreign Labor 
Certification, Chicago National Processing Center, 536 South Clark 
Street, Chicago, IL 60605-1509.
    (2) Attestations shall be reviewed and accepted for filing or 
rejected by ETA within 30 calendar days of the date they are received by 
ETA. Therefore, it is recommended that attestations be submitted to ETA 
at least 35 calendar days prior to the planned date for filing an H-1C 
visa petition with USCIS.
    (c) What shall be submitted?
    (1) Form ETA 9081 and required supporting documentation, as 
described in paragraphs (c)(1)(i) through (iv) of this section.
    (i) A completed and dated original Form ETA 9081, containing the 
required attestation elements and the original signature of the chief 
executive officer of the facility, shall be submitted, along with one 
copy of the completed, signed, and dated Form

[[Page 724]]

ETA 9081. Copies of the form and instructions are available at the 
address listed in paragraph (b) of this section.
    (ii) If the Attestation is the first filed by the hospital, it shall 
be accompanied by copies of pages from the hospital's Form HCFA 2552 
filed with the Department of Health and Human Services (pursuant to 
title XVIII of the Social Security Act) for its 1994 cost reporting 
period, showing the number of its acute care beds and the percentages of 
Medicaid and Medicare reimbursed acute care inpatient days (i.e., Form 
HCFA-2552-92, Worksheet S-3, Part I; Worksheet S, Parts I and II).
    (iii) If the facility attests that it will take one or more timely 
and significant steps other than the steps identified on Form ETA 9081, 
then the facility must submit (in duplicate) an explanation of the 
proposed step(s) and an explanation of how the proposed step(s) is/are 
of comparable significance to those set forth on the Form and inSec. 
655.1114. (SeeSec. 655.1114(b)(2)(v).)
    (iv) If the facility attests that taking more than one timely and 
significant step is unreasonable, then the facility must submit (in 
duplicate) an explanation of this attestation. (SeeSec. 655.1114(c).)
    (2) Filing fee of $250 per Attestation. Payment must be in the form 
of a check or money order, payable to the ``U.S. Department of Labor.'' 
Remittances must be drawn on a bank or other financial institution 
located in the U.S. and be payable in U.S. currency.
    (3) Copies of H-1C petitions and USCIS approval notices. After ETA 
has approved the attestation used by the facility to support any H-1C 
petition, the facility must send copies of each H-1C petition and USCIS 
approval notice on such petition to Employment and Training 
Administration, Administrator, Office of Foreign Labor Certification, 
200 Constitution Avenue, NW., Room C-4312, Washington, DC 20210.
    (d) Attestation elements. The attestation elements referenced in 
paragraph (c)(1) of this section are mandated by section 212(m)(2)(A) of 
the INA (8 U.S.C. 1182(m)(2)(A)). Section 212(m)(2)(A) requires a 
prospective employer of H-1C nurses to attest to the following:
    (1) That it qualifies as a facility (SeeSec. 655.1111);
    (2) That employment of H-1C nurses will not adversely affect the 
wages or working conditions of similarly employed nurses (SeeSec. 
655.1112);
    (3) That the facility will pay the H-1C nurse the facility wage rate 
(SeeSec. 655.1113);
    (4) That the facility has taken, and is taking, timely and 
significant steps to recruit and retain U.S. nurses (SeeSec. 
655.1114);
    (5) That there is not a strike or lockout at the facility, that the 
employment of H-1C nurses is not intended or designed to influence an 
election for a bargaining representative for RNs at the facility, and 
that the facility did not lay off and will not lay off a registered 
nurse employed by the facility 90 days before and after the date of 
filing a visa petition (SeeSec. 655.1115);
    (6) That the facility will notify its workers and give a copy of the 
Attestation to every nurse employed at the facility (SeeSec. 
655.1116);
    (7) That no more than 33 percent of nurses employed by the facility 
will be H-1C nonimmigrants (SeeSec. 655.1117); and
    (8) That the facility will not authorize H-1C nonimmigrants to work 
at a worksite not under its control, and will not transfer an H-1C 
nonimmigrant from one worksite to another (SeeSec. 655.1118).

[75 FR 10404, Mar. 5, 2010]



Sec.  655.1111  Element I--What hospitals are eligible to participate 
in the H-1C program?

    (a) The first attestation element requires that the employer be a 
``facility'' for purposes of the H-1C program, as defined in INA Section 
212(m)(6), 8 U.S.C. 1182 (2)(m)(6).
    (b) A qualifying facility under that section is a ``subpart (d) 
hospital,'' as defined in Section 1886(d)(1)(B) of the Social Security 
Act, 42 U.S.C. 1395ww(d)(1)(B), which:
    (1) Was located in a health professional shortage area (HPSA), as 
determined by the Department of Health and Human Services, on March 31, 
1997. A list of HPSAs, as of March 31, 1997, was published in the 
Federal Register on May 30, 1997 (62 FR 29395);

[[Page 725]]

    (2) Had at least 190 acute care beds, as determined by its settled 
cost report, filed under Title XVIII of the Social Security Act, (42 
U.S.C. 1395 et seq.), for its fiscal year 1994 cost reporting period 
(i.e., Form HCFA-2552-92, Worksheet S-3, Part I, column 1, line 8);
    (3) Had at least 35% of its acute care inpatient days reimbursed by 
Medicare, as determined by its settled cost report, filed under Title 
XVIII of the Social Security Act, for its fiscal year 1994 cost 
reporting period (i.e., Form HCFA-2552-92, Worksheet S-3, Part I, column 
4, line 8 as a percentage of column 6, line 8); and
    (4) Had at least 28% of its acute care inpatient days reimbursed by 
Medicaid, as determined by its settled cost report, filed under Title 
XVIII of the Social Security Act, for its fiscal year 1994 cost 
reporting period (i.e., Form HCFA-2552-92, Worksheet S-3, Part I, column 
5, line 8 as a percentage of column 6, line 8).
    (c) The Federal Register notice containing the controlling list of 
HPSAs (62 FR 29395), can be found in federal depository libraries and on 
the Government Printing Office Internet website at http://
www.access.gpo.gov.
    (d) To make a determination about information in the settled cost 
report, the employer shall examine its own Worksheet S-3, Part I, 
Hospital and Hospital Health Care Complex Statistical Data, in the 
Hospital and Hospital Health Care Complex Cost Report, Form HCFA 2552, 
filed for the fiscal year 1994 cost reporting period.
    (e) The facility must maintain a copy of the portions of Worksheet 
S-3, Part I and Worksheet S, Parts I and II of HCFA Form 2552 which 
substantiate the attestation of eligibility as a ``facility.'' One set 
of copies of this document must be kept in the facility's public access 
file. The full Form 2552 for fiscal year 1994 must be made available to 
the Department upon request.



Sec.  655.1112  Element II--What does ``no adverse effect on wages 
and working conditions'' mean?

    (a) The second attestation element requires that the facility attest 
that ``the employment of the alien will not adversely affect the wages 
and working conditions of registered nurses similarly employed.''
    (b) For purposes of this program, ``employment'' is full-time 
employment as defined inSec. 655.1102; part-time employment of H-1C 
nurses is not authorized.
    (c) Wages. To meet the requirement of no adverse effect on wages, 
the facility must attest that it will pay each nurse employed by the 
facility at least the prevailing wage for the occupation in the 
geographic area. The facility must pay the higher of the wage required 
under this paragraph or the wage required underSec. 655.1113 (i.e., 
the third attestation element: facility wage).
    (1) Collectively bargained wage rates. Where wage rates for nurses 
at a facility are the result of arms-length collective bargaining, those 
rates shall be considered ``prevailing'' for that facility for the 
purposes of this subpart.
    (2) Determination of prevailing wage for H-1C purposes. In the 
absence of collectively bargained wage rates, the National Processing 
Center (NPC) having jurisdiction as determined by OFLC shall determine 
the prevailing wage for similarly employed nurses in the geographic area 
in accordance with administrative guidelines issued by ETA for 
prevailing wage determination requests submitted on or after the 
effective date of these regulations.
    (i) Prior to the effective date of these regulations, the SWA having 
jurisdiction over the area of intended employment shall continue to 
receive and process prevailing wage determination requests in accordance 
with the regulatory provisions and Department guidance in effect prior 
to January 1, 2009. On or after the effective date of these regulations, 
the NPC shall receive and process prevailing wage determination requests 
in accordance with these regulations and with Department guidance. A 
facility seeking to determine the prevailing wage must request a 
prevailing wage determination from the NPC having jurisdiction for 
providing the prevailing wage over the proposed area of intended 
employment not more

[[Page 726]]

than 90 days prior to the date the attestation is submitted to the 
Department. The NPC must enter its wage determination on the form it 
uses and return the form with its endorsement to the employer. Once a 
facility obtains a prevailing wage determination from the NPC and files 
an attestation supported by that prevailing wage determination, the 
facility shall be deemed to have accepted the prevailing wage 
determination as accurate and appropriate (as to both the occupational 
classification and the wage rate) and thereafter shall not contest the 
legitimacy of that prevailing wage determination in an investigation or 
enforcement action pursuant to subpart M of this part.
    (ii) A facility may challenge the prevailing wage determination with 
the NPC having provided such determination according to administrative 
guidelines issued by ETA, but must obtain a final ruling prior to filing 
an attestation.
    (3) Total compensation package. The prevailing wage under this 
paragraph relates to wages only. Employers are cautioned that each item 
in the total compensation package for U.S. nurses, H-1C, and other 
nurses employed by the facility must be the same within a given 
facility, including such items as housing assistance and fringe 
benefits.
    (4) Documentation of pay and total compensation. The facility must 
maintain in its public access file a copy of the prevailing wage, which 
shall be either the collective bargaining agreement or the determination 
that was obtained from the NPC. The facility must maintain payroll 
records, as specified inSec. 655.1113, and make such records available 
to the Administrator in the event of an enforcement action pursuant to 
subpart M.
    (d) Working conditions. To meet the requirement of no adverse effect 
on working conditions, the facility must attest that it will afford 
equal treatment to U.S. and H-1C nurses with the same seniority, with 
respect to such working conditions as the number and scheduling of hours 
worked (including shifts, straight days, weekends); vacations; wards and 
clinical rotations; and overall staffing-patient patterns. In the event 
of an enforcement action pursuant to subpart M, the facility must 
provide evidence substantiating compliance with this attestation.

[65 FR 51149, Aug. 22, 2000, as amended at 73 FR 78068, Dec. 19, 2008]



Sec.  655.1113  Element III--What does ``facility wage rate'' mean?

    (a) The third attestation element requires that the facility 
employing or seeking to employ the alien must attest that ``the alien 
employed by the facility will be paid the wage rate for registered 
nurses similarly employed by the facility.''
    (b) The facility must pay the higher of the wage required in this 
section (i.e. facility wage), or the wage required inSec. 655.1112 
(i.e., prevailing wage).
    (c) Wage obligations for H-1C nurses in nonproductive status--(1) 
Circumstances where wages must be paid. If the H-1C nurse is not 
performing work and is in a nonproductive status due to a decision by 
the facility (e.g., because of lack of assigned work), because the nurse 
has not yet received a license to work as a registered nurse, or any 
other reason except as specified in paragraph (c)(2) of this section, 
the facility is required to pay the salaried H-1C nurse the full amount 
of the weekly salary, or to pay the hourly-wage H-1C nurse for a full-
time week (40 hours or such other number of hours as the facility can 
demonstrate to be full-time employment) at the applicable wage rate.
    (2) Circumstances where wages need not be paid. If an H-1C nurse 
experiences a period of nonproductive status due to conditions unrelated 
to employment which take the nurse away from his/her duties at his/her 
voluntary request and convenience (e.g., touring the U.S., caring for 
ill relative) or render the nonimmigrant unable to work (e.g., maternity 
leave, automobile accident which temporarily incapacitates the 
nonimmigrant), then the facility is not obligated to pay the required 
wage rate during that period, provided that such period is not subject 
to payment under the facility's benefit plan. Payment need not be made 
if there has been a bona fide termination of the employment 
relationship, as demonstrated by

[[Page 727]]

notification to USCIS that the employment relationship has been 
terminated and the petition should be canceled.
    (d) Documentation. The facility must maintain documentation 
substantiating compliance with this attestation element. The public 
access file shall contain the facility pay schedule for nurses or a 
description of the factors taken into consideration by the facility in 
making compensation decisions for nurses, if either of these documents 
exists. Categories of nursing positions not covered by the public access 
file documentation shall not be covered by the Attestation, and, 
therefore, such positions shall not be filled or held by H-1C nurses. 
The facility must maintain the payroll records, as required under the 
Fair Labor Standards Act at 29 CFR part 516, and make such records 
available to the Administrator in the event of an enforcement action 
pursuant to subpart M of this part.



Sec.  655.1114  Element IV--What are the timely and significant steps
an H-1C employer must take to recruit and retain U.S. nurses?

    (a) The fourth attestation element requires that the facility attest 
that it ``has taken and is taking timely and significant steps designed 
to recruit and retain sufficient registered nurses who are United States 
citizens or immigrants who are authorized to perform nursing services, 
in order to remove as quickly as reasonably possible the dependence of 
the facility on nonimmigrant registered nurses.'' The facility must take 
at least two such steps, unless it demonstrates that taking a second 
step is not reasonable. The steps described in this section shall not be 
considered to be an exclusive list of the significant steps that may be 
taken to meet the conditions of this section. Nothing in this subpart or 
subpart M of this part shall require a facility to take more than one 
step, if the facility can demonstrate that taking a second step is not 
reasonable. A facility choosing to take timely and significant steps 
other than those specifically described in this section must submit with 
its Attestation a description of the step(s) it is proposing to take and 
an explanation of how the proposed step(s) are of comparable timeliness 
and significance to those described in this section (SeeSec. 
655.1110(c)(1)(iii)). A facility claiming that a second step is 
unreasonable must submit an explanation of why such second step would be 
unreasonable (SeeSec. 655.1110(c)(1)(iv)).
    (b) Descriptions of steps. Each of the actions described in this 
section shall be considered a significant step reasonably designed to 
recruit and retain U.S. nurses. A facility choosing any of these steps 
shall designate such step on Form ETA 9081, thereby attesting that its 
program(s) meets the regulatory requirements set forth for such step. 
Section 212(m)(2)(E)(ii) of the INA provides that a violation shall be 
found if a facility fails to meet a condition attested to. Thus, a 
facility shall be held responsible for all timely and significant steps 
to which it attests.
    (1) Statutory steps--(i) Operating a training program for registered 
nurses at the facility or financing (or providing participation in) a 
training program for registered nurses elsewhere. Training programs may 
include either courses leading to a higher degree (i.e., beyond an 
associate or a baccalaureate degree), or continuing education courses. 
If the program includes courses leading to a higher degree, they must be 
courses which are part of a program accepted for degree credit by a 
college or university and accredited by a State Board of Nursing or a 
State Board of Higher Education (or its equivalent), as appropriate. If 
the program includes continuing education courses, they must be courses 
which meet criteria established to qualify the nurses taking the courses 
to earn continuing education units accepted by a State Board of Nursing 
(or its equivalent). In either type of program, financing by the 
facility (either directly or arranged through a third party) shall cover 
the total costs of such training. The number of U.S. nurses for whom 
such training actually is provided shall be no less than half of the 
number of nurses who left the facility during the 12-month period prior 
to submission of the Attestation. U.S. nurses to whom such training was 
offered, but who rejected such training, may be counted towards those 
provided training.
    (ii) Providing career development programs and other methods of 
facilitating

[[Page 728]]

health care workers to become registered nurses. This may include 
programs leading directly to a degree in nursing, or career ladder/
career path programs which could ultimately lead to a degree in nursing. 
Any such degree program shall be, at a minimum, through an accredited 
community college (leading to an associate's degree), 4-year college (a 
bachelor's degree), or diploma school, and the course of study must be 
one accredited by a State Board of Nursing (or its equivalent). The 
facility (either directly or arranged through a third party) must cover 
the total costs of such programs. U.S. workers participating in such 
programs must be working or have worked in health care occupations or 
facilities. The number of U.S. workers for whom such training is 
provided must be equal to no less than half the average number of 
vacancies for nurses during the 12-month period prior to the submission 
of the Attestation. U.S. nurses to whom such training was offered, but 
who rejected such training, may be counted towards those provided 
training.
    (iii) Paying registered nurses wages at a rate higher than currently 
being paid to registered nurses similarly employed in the geographic 
area. The facility's entire schedule of wages for nurses shall be at 
least 5 percent higher than the prevailing wage as determined by the 
NPC, and such differentials shall be maintained throughout the period of 
the Attestation's effectiveness.
    (iv) Providing reasonable opportunities for meaningful salary 
advancement by registered nurses. This may include salary advancement 
based on factors such as merit, education, and specialty, and/or salary 
advancement based on length of service, with other bases for wage 
differentials remaining constant.
    (A) Merit, education, and specialty. Salary advancement may be based 
on factors such as merit, education, and specialty, or the facility may 
provide opportunities for professional development of its nurses which 
lead to salary advancement (e.g., participation in continuing education 
or in-house educational instruction; service on special committees, task 
forces, or projects considered of a professional development nature; 
participation in professional organizations; and writing for 
professional publications). Such opportunities must be available to all 
the facility's nurses.
    (B) Length of service. Salary advancement may be based on length of 
service using clinical ladders which provide, annually, salary increases 
of 3 percent or more for a period of no less than 10 years, over and 
above the costs of living and merit, education, and specialty increases 
and differentials.
    (2) Other possible steps. The Act indicates that the four steps 
described in the statute (and set out in paragraph (b)(1) of this 
section) are not an exclusive list of timely and significant steps which 
might qualify. The actions described in paragraphs (b)(2)(i) through 
(iv) of this section, are also deemed to be qualified; in paragraph 
(b)(2)(v) of this section, the facility is afforded the opportunity to 
identify a timely and significant step of its own devising.
    (i) Monetary incentives. The facility provides monetary incentives 
to nurses, through bonuses and merit pay plans not included in the base 
compensation package, for additional education, and for efforts by the 
nurses leading to increased recruitment and retention of U.S. nurses. 
Such monetary incentives may be based on actions by nurses such as: 
Instituting innovations to achieve better patient care, increased 
productivity, reduced waste, and/or improved workplace safety; obtaining 
additional certification in a nursing specialty; accruing unused sick 
leave; recruiting other U.S. nurses; staying with the facility for a 
given number of years; taking less desirable assignments (other than 
shift differential); participating in professional organizations; 
serving on task forces and on special committees; or contributing to 
professional publications.
    (ii) Special perquisites. The facility provides nurses with special 
perquisites for dependent care or housing assistance of a nature and/or 
extent that constitute a ``significant'' factor in inducing employment 
and retention of U.S. nurses.
    (iii) Work schedule options. The facility provides nurses with non-
mandatory work schedule options for part-time work, job-sharing, 
compressed

[[Page 729]]

work week or non-rotating shifts (provided, however, that H-1C nurses 
are employed only in full-time work) of a nature and/or extent that 
constitute a ``significant'' factor in inducing employment and retention 
of U.S. nurses.
    (iv) Other training options. The facility provides training 
opportunities to U.S. workers not currently in health care occupations 
to become registered nurses by means of financial assistance (e.g., 
scholarship, loan or pay-back programs) to such persons.
    (v) Alternative but significant steps. Facilities are encouraged to 
be innovative in devising timely and significant steps other than those 
described in paragraphs (b)(1) and (b)(2)(i) through (iv) of this 
section. To qualify, an alternative step must be of a timeliness and 
significance comparable to those in this section. A facility may 
designate on Form ETA 9081 that it has taken and is taking such 
alternate step(s), thereby attesting that the step(s) meet the statutory 
test of timeliness and significance comparable to those described in 
paragraphs (b)(1) and (b)(2)(i) through (iv) in promoting the 
development, recruitment, and retention of U.S. nurses. If such a 
designation is made on Form ETA 9081, the submission of the Attestation 
to ETA must include an explanation and appropriate documentation of the 
alternate step(s), and of the manner in which they satisfy the statutory 
test in comparison to the steps described in paragraphs (b)(1) and 
(b)(2)(i) through (iv). ETA will review the explanation and 
documentation and determine whether the alternate step(s) qualify under 
this subsection. The ETA determination is subject to review by the 
BALCA, upon the request of an interested party; such review shall be 
limited to this matter.
    (c) Unreasonableness of second step. Nothing in this subpart or 
subpart M of this part requires a facility to take more than one step, 
if the facility can demonstrate that taking a second step is not 
reasonable. However, a facility shall make every effort to take at least 
two steps. The taking of a second step may be considered unreasonable if 
it would result in the facility's financial inability to continue 
providing the same quality and quantity of health care or if the 
provision of nursing services would otherwise be jeopardized by the 
taking of such a step.
    (1) A facility may designate on Form ETA 9081 that the taking of a 
second step is not reasonable. If such a designation is made on Form ETA 
9081, the submission of the Attestation to ETA shall include an 
explanation and appropriate documentation with respect to each of the 
steps described in paragraph (b) of this section (other than the step 
designated as being taken by the facility), showing why it would be 
unreasonable for the facility to take each such step and why it would be 
unreasonable for the facility to take any other step designed to 
recruit, develop and retain sufficient U.S. nurses to meet its staffing 
needs.
    (2) ETA will review the explanation and documentation, and will 
determine whether the taking of a second step would not be reasonable. 
The ETA determination is subject to review by the BALCA, upon the 
request of an interested party; such review shall be limited to this 
matter.
    (d) Performance-based alternative to criteria for specific steps. 
Instead of complying with the specific criteria for one or more of the 
steps in the second and/or succeeding years of participation in the H-1C 
program, a facility may include in its prior year's Attestation, in 
addition to the actions taken under specifically attested steps, that it 
will reduce the number of H-1C nurses it utilizes within one year from 
the date of the Attestation by at least 10 percent, without reducing the 
quality or quantity of services provided. If this goal is achieved, the 
facility shall so indicate on its subsequent year's Attestation. 
Further, the facility need not attest to any ``timely and significant 
step'' on that subsequent attestation, if it again indicates that it 
shall again reduce the number of H-1C nurses it utilizes within one year 
from the date of the Attestation by at least 10 percent. This 
performance-based alternative is designed to permit a facility to 
achieve the objectives of the Act, without subjecting the facility to 
detailed requirements and criteria as to the specific means of achieving 
that objective.

[[Page 730]]

    (e) Documentation. The facility must include in the public access 
file a description of the activities which constitute its compliance 
with each timely and significant step which is attested on Form ETA 9081 
(e.g., summary of a training program for registered nurses; description 
of a career ladder showing meaningful opportunities for pay advancements 
for nurses). If the facility has attested that it will take an 
alternative step or that taking a second step is unreasonable, then the 
public access file must include the documentation which was submitted to 
ETA under paragraph (c) of this section. The facility must maintain in 
its non-public files, and must make available to the Administrator in 
the event of an enforcement action pursuant to subpart M of this part, 
documentation which provides a complete description of the nature and 
operation of its program(s) sufficient to substantiate its full 
compliance with the requirements of each timely and significant step 
which is attested to on Form ETA 9081. This documentation should include 
information relating to all of the requirements for the step in 
question.



Sec.  655.1115  Element V--What does ``no strike/lockout or 
layoff'' mean?

    (a) The fifth attestation element requires that the facility attest 
that ``there is not a strike or lockout in the course of a labor 
dispute, the facility did not lay off and will not lay off a registered 
nurse employed by the facility within the period beginning 90 days 
before and ending 90 days after the date of filing of any visa petition, 
and the employment of such an alien is not intended or designated to 
influence an election for a bargaining representative for registered 
nurses of the facility.'' Labor disputes for purposes of this 
attestation element relate only to those involving nurses providing 
nursing services; other health service occupations are not included. A 
facility which has filed a petition for H-1C nurses is also prohibited 
from interfering with the right of the nonimmigrant to join or organize 
a union.
    (b) Notice of strike or lockout. In order to remain in compliance 
with the no strike or lockout portion of this attestation element, the 
facility must notify ETA if a strike or lockout of nurses at the 
facility occurs during the 1 year validity period of the attestation. 
Within 3 days of the occurrence of such strike or lockout, the facility 
must submit to the Administrator, Office of Foreign Labor Certification, 
Employment and Training Administration, Department of Labor, 200 
Constitution Avenue, NW., Room C-4312, Washington, DC 20210, by U.S. 
mail or private carrier, written notice of the strike or lockout. Upon 
receiving a notice described in this section from a facility, ETA will 
examine the documentation, and may consult with the union at the 
facility or other appropriate entities. If ETA determines that the 
strike or lockout is covered under USCIS regulation 8 CFR 214.2(h)(17), 
Effect of a strike, for ``H'' nonimmigrants, ETA must certify to USCIS, 
in the manner set forth in that regulation, that a strike or other labor 
dispute involving a work stoppage of nurses is in progress at the 
facility.
    (c) Lay off of a U.S. nurse means that the employer has caused the 
nurse's loss of employment in circumstances other than where--
    (1) A U.S. nurse has been discharged for inadequate performance, 
violation of workplace rules, or other reasonable work-related cause;
    (2) A U.S. nurse's departure or retirement is voluntary (to be 
assessed in light of the totality of the circumstances, under 
established principles concerning ``constructive discharge'' of workers 
who are pressured to leave employment);
    (3) The grant or contract under which the work performed by the U.S. 
nurse is required and funded has expired, and without such grant or 
contract the nurse would not continue to be employed because there is no 
alternative funding or need for the position; or
    (4) A U.S. nurse who loses employment is offered, as an alternative 
to such loss, a similar employment opportunity with the same employer. 
The validity of the offer of a similar employment opportunity will be 
assessed in light of the following factors:
    (i) The offer is a bona fide offer, rather than an offer designed to 
induce the U.S. nurse to refuse or an offer made

[[Page 731]]

with the expectation that the worker will refuse;
    (ii) The offered job provides the U.S. nurse an opportunity similar 
to that provided in the job from which he/she is discharged, in terms 
such as a similar level of authority, discretion, and responsibility, a 
similar opportunity for advancement within the organization, and similar 
tenure and work scheduling;
    (iii) The offered job provides the U.S. nurse equivalent or higher 
compensation and benefits to those provided in the job from which he/she 
is discharged.
    (d) Documentation. The facility must include in its public access 
file, copies of all notices of strikes or other labor disputes involving 
a work stoppage of nurses at the facility (submitted to ETA under 
paragraph (b) of this section). The facility must retain in its non-
public files, and make available in the event of an enforcement action 
pursuant to subpart M of this part, any existing documentation with 
respect to the departure of each U.S. nurse who left his/her employment 
with the facility in the period from 90 days before until 90 days after 
the facility's petition for H-1C nurse(s). The facility is also required 
to have a record of the terms of any offer of alternative employment to 
such a U.S. nurse and the nurse's response to the offer (which may be a 
note to the file or other record of the nurse's response), and to make 
such record available in the event of an enforcement action pursuant to 
subpart M.

[65 FR 51149, Aug. 22, 2000, as amended at 75 FR 10405, Mar. 5, 2010]



Sec.  655.1116  Element VI--What notification must facilities provide
to registered nurses?

    (a) The sixth attestation element requires the facility to attest 
that at the time of filing of the petition for registered nurses under 
section 101(a)(15)(H)(i)(c) of the INA, notice of filing has been 
provided by the facility to the bargaining representative of the 
registered nurses at the facility or, where there is no such bargaining 
representative, notice of the filing has been provided to registered 
nurses at the facility through posting in conspicuous locations, and 
individual copies of the Attestation have been provided to registered 
nurses employed at the facility.
    (b) Notification of bargaining representative. (1) At a time no 
later than the date the attestation is transmitted to ETA, on ETA Form 
9081, Attestation for H-1C Nonimmigrant Nurses, the facility must notify 
the bargaining representative (if any) for nurses at the facility that 
the attestation is being submitted. This notice may be either a copy of 
the attestation (ETA Form 9081) or a document stating that the 
attestations are available for review by interested parties at the 
facility (explaining how they can be inspected or obtained) and at the 
Office of Foreign Labor Certification, Employment and Training 
Administration, Department of Labor, 200 Constitution Avenue, NW., Room 
C-4312, Washington, DC 20210. The notice must include the following 
statement: ``Complaints alleging misrepresentation of material facts in 
the attestation or failure to comply with the terms of the attestation 
may be filed with any office of the Wage and Hour Division, United 
States Department of Labor.''
    (2) No later than the date the facility transmits a petition for H-
1C nurses to USCIS, the facility must notify the bargaining 
representative (if any) for nurses at the facility that the H-1C 
petition is being submitted. This notice may be either a copy of 
petition, or a document stating that the attestations and H-1C petition 
are available for review by interested parties at the facility 
(explaining how they can be inspected or obtained) and at the Office of 
Foreign Labor Certification, Employment and Training Administration, 
Department of Labor, 200 Constitution Avenue, NW., Room C-4312, 
Washington, DC 20210. The notice must include the following statement: 
``Complaints alleging misrepresentation of material facts in the 
attestation or failure to comply with the terms of the attestation may 
be filed with any office of the Wage and Hour Division, United States 
Department of Labor.''
    (c) Posting notice. If there is no bargaining representative for 
nurses at the facility, the facility must post a

[[Page 732]]

written notice in two or more conspicuous locations at the facility. 
Such notices shall be clearly visible and unobstructed while posted, and 
shall be posted in conspicuous places where nurses can easily read the 
notices on their way to or from their duties. Appropriate locations for 
posting hard copy notices include locations in the immediate proximity 
of mandatory Fair Labor Standards Act wage and hour notices and 
Occupational Safety and Health Act occupational safety and health 
notices. In the alternative, the facility may use electronic means it 
ordinarily uses to communicate with its nurses about job vacancies or 
promotion opportunities, including through its ``home page'' or 
``electronic bulletin board,'' provided that the nurses have, as a 
practical matter, direct access to those sites; or, where the nurses 
have individual e-mail accounts, the facility may use e-mail. This must 
be accomplished no later than the date when the facility transmits an 
Attestation to ETA and the date when the facility transmits an H-1C 
petition to the USCIS. The notice may be either a copy of the 
Attestation or petition, or a document stating that the Attestation or 
petition has been filed and is available for review by interested 
parties at the facility (explaining how these documents can be inspected 
or obtained) and at the national office of ETA. The notice shall include 
the following statement: ``Complaints alleging misrepresentation of 
material facts in the Attestation or failure to comply with the terms of 
the Attestation may be filed with any office of the Wage and Hour 
Division of the United States Department of Labor.'' Unless it is sent 
to an individual e-mail address, the Attestation notice shall remain 
posted during the validity period of the Attestation; the petition 
notice shall remain posted for ten days. Copies of all notices shall be 
available for examination in the facility's public access file.
    (d) Individual notice to RNs. In addition to notifying the 
bargaining representative or posting notice as described in paragraphs 
(b) and (c) of this section, the facility must provide a copy of the 
Attestation, within 30 days of the date of filing, to every registered 
nurse employed at the facility. This requirement may be satisfied by 
electronic means if an individual e-mail message, with the Attestation 
as an attachment, is sent to every RN at the facility. This notification 
includes not only the RNs employed by the facility, but also includes 
any RN who is providing service at the facility as an employee of 
another entity, such as a nursing contractor.
    (e) Where RNs lack practical computer access, a hard copy must be 
posted in accordance with paragraph (c) of this section and a hard copy 
of the Attestation delivered, within 30 days of the date of filing, to 
every RN employed at the facility in accordance with paragraph (d) of 
this section.
    (f) The facility must maintain, in its public access file, copies of 
the notices required by this section. The facility must make such 
documentation available to the Administrator in the event of an 
enforcement action pursuant to subpart M of this part.

[65 FR 51149, Aug. 22, 2000, as amended at 75 FR 10405, Mar. 5, 2010]



Sec.  655.1117  Element VII--What are the limitations as to the number
of H-1C nonimmigrants that a facility may employ?

    (a) The seventh attestation element requires that the facility 
attest that it will not, at any time, employ a number of H-1C nurses 
that exceeds 33% of the total number of registered nurses employed by 
the facility. The calculation of the population of nurses for purposes 
of this attestation includes only nurses who have an employer-employee 
relationship with the facility (as defined inSec. 655.1102).
    (b) The facility must maintain documentation (e.g., payroll records, 
copies of H-1C petitions) that demonstrates its compliance with this 
attestation. The facility must make such documentation available to the 
Administrator in the event of an enforcement action pursuant to subpart 
M of this part.



Sec.  655.1118  Element VIII--What are the limitations as to where 
the H-1C nonimmigrant may be employed?

    The eighth attestation element requires that the facility attest 
that it will not authorize any H-1C nurse to

[[Page 733]]

perform services at any worksite not controlled by the facility or 
transfer any H-1C nurse from one worksite to another worksite, even if 
all of the worksites are controlled by the facility.



Sec.  655.1130  What criteria does the Department use to determine
whether or not to certify an Attestation?

    (a) An Attestation form which is complete and has no obvious 
inaccuracies will be accepted for filing by ETA without substantive 
review, except that ETA will conduct a substantive review on particular 
attestation elements in the following limited circumstances:
    (1) Determination of whether the hospital submitting the Attestation 
is a qualifying ``facility'' (seeSec. 655.1110(c)(ii), regarding the 
documentation required, and the process for review);
    (2) Where the facility attests that it is taking or will take a 
``timely and significant step'' other than those identified on the Form 
ETA 9081 (seeSec. 655.1114(b)(2)(v), regarding the documentation 
required, and the process for review);
    (3) Where the facility asserts that taking a second ``timely and 
significant step'' is unreasonable (seeSec. 655.1114(c), regarding the 
documentation required, and the process for review).
    (b) The certifying officer will act on the Attestation in a timely 
manner. If the officer does not contact the facility for information or 
make any determination within 30 days of receiving the Attestation, the 
Attestation shall be accepted for filing. If ETA receives information 
contesting the truth of the statements attested to or compliance with an 
Attestation prior to the determination to accept or reject the 
Attestation for filing, such information shall not be made part of ETA's 
administrative record on the Attestation but shall be referred to the 
Administrator to be processed as a complaint pursuant to subpart M of 
this part if such Attestation is accepted by ETA for filing.
    (c) When the facility submits the attestation to ETA and provides 
the notice required bySec. 655.1116, the attestation must be made 
available for public examination at the facility. When ETA accepts the 
attestation for filing, the attestation will be made available, upon 
request, for public examination in the Office of Foreign Labor 
Certification, Employment Training Administration, U.S. Department of 
Labor, Room C-4312, 200 Constitution Avenue, NW., Washington, DC 20210.
    (d) Standards for acceptance of Attestation. ETA will accept the 
Attestation for filing under the following standards:
    (1) The Attestation is complete and contains no obvious 
inaccuracies.
    (2) The facility's explanation and documentation are sufficient to 
satisfy the requirements for the Attestation elements on which 
substantive review is conducted (as described in paragraph (a) of this 
section).
    (3) The facility has no outstanding ``insufficient funds'' check(s) 
in connection with filing fee(s) for prior Attestation(s).
    (4) The facility has no outstanding civil money penalties and/or has 
not failed to satisfy a remedy assessed by the Wage and Hour 
Administrator, under subpart M of this part, where that penalty or 
remedy assessment has become the final agency action.
    (5) The facility has not been disqualified from approval of any 
petitions filed by, or on behalf of, the facility under section 204 or 
section 212(m) of the INA.
    (e) DOL not the guarantor. DOL is not the guarantor of the accuracy, 
truthfulness or adequacy of an Attestation accepted for filing.
    (f) Attestation Effective and Expiration Dates. An Attestation 
becomes filed and effective as of the date it is accepted and signed by 
the ETA certifying officer. Such Attestation is valid until the date 
that is the later of the end of the 12-month period beginning on the 
date of acceptance for filing with the Secretary, or the end of the 
period of admission (under INA section 101(a)(15)(H)(i)(c)) of the last 
alien with respect to whose admission the Attestation was applied, 
unless the Attestation is suspended or invalidated earlier than such 
date pursuant toSec. 655.1132.

[65 FR 51149, Aug. 22, 2000, as amended at 75 FR 10406, Mar. 5, 2010]

[[Page 734]]



Sec.  655.1132  When will the Department suspend or invalidate an 
approved Attestation?

    (a) Suspension or invalidation of an Attestation may result where: 
the facility's check for the filing fee is not honored by a financial 
institution; a Board of Alien Labor Certification Appeals (BALCA) 
decision reverses an ETA certification of the Attestation; ETA finds 
that it made an error in its review and certification of the 
Attestation; an enforcement proceeding has finally determined that the 
facility failed to meet a condition attested to, or that there was a 
misrepresentation of material fact in an Attestation; the facility has 
failed to pay civil money penalties and/or failed to satisfy a remedy 
assessed by the Wage and Hour Administrator, where that penalty or 
remedy assessment has become the final agency action. If an Attestation 
is suspended or invalidated, ETA will notify USCIS.
    (b) BALCA decision or final agency action in an enforcement 
proceeding. If an Attestation is suspended or invalidated as a result of 
a BALCA decision overruling an ETA acceptance of the Attestation for 
filing, or is suspended or invalidated as a result of an enforcement 
action by the Administrator under subpart M of this part, such 
suspension or invalidation may not be separately appealed, but shall be 
merged with appeals on the underlying matter.
    (c) ETA action. If, after accepting an Attestation for filing, ETA 
discovers that it erroneously accepted that Attestation for filing and, 
as a result, ETA suspends or invalidates that acceptance, the facility 
may appeal such suspension or invalidation underSec. 655.1135 as if 
that suspension or invalidation were a decision to reject the 
Attestation for filing.
    (d) A facility must comply with the terms of its Attestation, even 
if such Attestation is suspended, invalidated or expired, as long as any 
H-1C nurse is at the facility, unless the Attestation is superseded by a 
subsequent Attestation accepted for filing by ETA.



Sec.  655.1135  What appeals procedures are available concerning ETA's
actions on a facility's Attestation?

    (a) Appeals of acceptances or rejections. Any interested party may 
appeal ETA's acceptance or rejection of an Attestation submitted by a 
facility for filing. However, such an appeal shall be limited to ETA's 
determination on one or more of the attestation elements for which ETA 
conducts a substantive review (as described inSec. 655.1130(a)). Such 
appeal must be filed no later than 30 days after the date of the 
acceptance or rejection, and will be considered under the procedures set 
forth at paragraphs (d) and (f) of this section.
    (b) Appeal of invalidation or suspension. An interested party may 
appeal ETA's invalidation or suspension of a filed Attestation due to a 
discovery by ETA that it made an error in its review of the Attestation, 
as described inSec. 655.1132.
    (c) Parties to the appeal. In the case of an appeal of an 
acceptance, the facility will be a party to the appeal; in the case of 
the appeal of a rejection, invalidation, or suspension, the collective 
bargaining representative (if any) representing nurses at the facility 
shall be a party to the appeal. Appeals shall be in writing; shall set 
forth the grounds for the appeal; shall state if de novo consideration 
by BALCA is requested; and shall be mailed by certified mail within 30 
calendar days of the date of the action from which the appeal is taken 
(i.e., the acceptance, rejection, suspension or invalidation of the 
Attestation).
    (d) Where to file appeals. Appeals made under this section must be 
in writing and must be mailed by certified mail to: U.S. Department of 
Labor, Employment and Training Administration, Office of Foreign Labor 
Certification, Chicago National Processing Center, 536 South Clark 
Street, Chicago, IL 60605-1509.
    (e) Transmittal of the case file to BALCA. Upon receipt of an appeal 
under this section, the Certifying Office shall send to BALCA a 
certified copy of the ETA case file, containing the Attestation and 
supporting documentation and any other information or data considered by 
ETA in taking

[[Page 735]]

the action being appealed. The administrative law judge chairing BALCA 
shall assign a panel of one or more administrative law judges who serve 
on BALCA to review the record for legal sufficiency and to consider and 
rule on the appeal.
    (f) Consideration on the record; de novo hearings. BALCA may not 
remand, dismiss, or stay the case, except as provided in paragraph (h) 
of this section, but may otherwise consider the appeal on the record or 
in a de novo hearing (on its own motion or on a party's request). 
Interested parties and amici curiae may submit briefs in accordance with 
a schedule set by BALCA. The ETA official who made the determination 
which was appealed will be represented by the Associate Solicitor for 
Employment and Training Legal Services, Office of the Solicitor, 
Department of Labor, or the Associate Solicitor's designee. If BALCA 
determines to hear the appeal on the record without a de novo hearing, 
BALCA shall render a decision within 30 calendar days after BALCA's 
receipt of the case file. If BALCA determines to hear the appeal through 
a de novo hearing, the procedures contained in 29 CFR part 18 will apply 
to such hearings, except that:
    (1) The appeal will not be considered to be a complaint to which an 
answer is required.
    (2) BALCA shall ensure that, at the request of the appellant, the 
hearing is scheduled to take place within a reasonable period after 
BALCA's receipt of the case file (see also the time period described in 
paragraph (f)(4) of this section).
    (3) Technical rules of evidence, such as the Federal Rules of 
Evidence and subpart B of the Rules of Practice and Procedure for 
Administrative Hearings Before the Office of Administrative Law Judges 
(29 CFR part 18, subpart B), will not apply to any hearing conducted 
pursuant to this subpart, but rules or principles designed to assure 
production of the most credible evidence available, and to subject 
testimony to test by cross-examination, shall be applied where 
reasonably necessary by BALCA in conducting the hearing. BALCA may 
exclude irrelevant, immaterial, or unduly repetitious evidence. The 
certified copy of the case file transmitted to BALCA by the Certifying 
Officer must be made part of the evidentiary record of the case and need 
not be moved into evidence.
    (4) BALCA's decision shall be rendered within 120 calendar days 
after BALCA's receipt of the case file.
    (g) Dismissals and stays. If BALCA determines that the appeal is 
solely a question of misrepresentation by the facility or is solely a 
complaint of the facility's nonperformance of the Attestation, BALCA 
shall dismiss the case and refer the matter to the Administrator, Wage 
and Hour Division, for action under subpart M. If BALCA determines that 
the appeal is partially a question of misrepresentation by the facility, 
or is partially a complaint of the facility's nonperformance of the 
Attestation, BALCA shall refer the matter to the Administrator, Wage and 
Hour Division, for action under subpart M of this part and shall stay 
BALCA consideration of the case pending final agency action on such 
referral. During such stay, the 120-day period described in paragraph 
(f)(1)(iv) of this section shall be suspended.
    (h) BALCA's decision. After consideration on the record or a de novo 
hearing, BALCA shall either affirm or reverse ETA's decision, and shall 
so notify the appellant; and any other parties.
    (i) Decisions on Attestations. With respect to an appeal of the 
acceptance, rejection, suspension or invalidation of an Attestation, the 
decision of BALCA shall be the final decision of the Secretary, and no 
further review shall be given to the matter by any DOL official.

[65 FR 51149, Aug. 22, 2000, as amended at 75 FR 10406, Mar. 5, 2010]



Sec.  655.1150  What materials must be available to the public?

    (a) Public examination at ETA. ETA will make available, upon 
request, for public examination at the Office of Foreign Labor 
Certification, Employment Training Administration, U.S. Department of 
Labor, Room C-4312, 200 Constitution Avenue, NW., Washington, DC 20210, 
a list of facilities which have filed attestations; a copy of the 
facility's attestation(s) and any supporting documentation; and a copy

[[Page 736]]

of each of the facility's H-1C petitions (if any) to USCIS along with 
the USCIS approval notices (if any).
    (b) Public examination at facility. For the duration of the 
Attestation's validity and thereafter for so long as the facility 
employs any H-1C nurse under the Attestation, the facility must maintain 
a separate file containing a copy of the Attestation, a copy of the 
prevailing wage determination, a description of the facility pay system 
or a copy of the facility's pay schedule if either document exists, 
copies of the notices provided underSec. 655.1115 andSec. 655.1116, 
a description of the ``timely and significant steps'' as described in 
Sec.  655.1114, and any other documentation required by this part to be 
contained in the public access file. The facility must make this file 
available to any interested parties within 72 hours upon written or oral 
request. If a party requests a copy of the file, the facility shall 
provide it and any charge for such copy shall not exceed the cost of 
reproduction.
    (c) ETA Notice to public. ETA will periodically publish a notice in 
the Federal Register announcing the names and addresses of facilities 
which have submitted Attestations; facilities which have Attestations on 
file; facilities which have submitted Attestations which have been 
rejected for filing; and facilities which have had Attestations 
suspended.

[65 FR 51149, Aug. 22, 2000, as amended at 75 FR 10406, Mar. 5, 2010]



Subpart M_What are the Department's enforcement obligations with respect 
                          to H	1C Attestations?

    Source: 65 FR 51149, Aug. 22, 2000, unless otherwise noted.

    Editorial Note: Nomenclature changes to subpart M appear at 75 FR 
10403, Mar. 5, 2010.



Sec.  655.1200  What enforcement authority does the Department have
with respect to a facility's H-1C Attestations?

    (a) The Administrator shall perform all the Secretary's 
investigative and enforcement functions under 8 U.S.C. 1182(m) and 
subparts L and M of this part.
    (b) The Administrator, either because of a complaint or otherwise, 
shall conduct such investigations as may be appropriate and, in 
connection therewith, enter and inspect such places and such records 
(and make transcriptions thereof), question such persons and gather such 
information as deemed necessary by the Administrator to determine 
compliance with the matters to which a facility has attested under 
section 212(m) of the INA (8 U.S.C. 1182(m)) and subparts L and M of 
this part.
    (c) A facility being investigated must make available to the 
Administrator such records, information, persons, and places as the 
Administrator deems appropriate to copy, transcribe, question, or 
inspect. A facility must fully cooperate with any official of the 
Department of Labor performing an investigation, inspection, or law 
enforcement function under 8 U.S.C. 1182(m) or subparts L or M of this 
part. Such cooperation shall include producing documentation upon 
request. The Administrator may deem the failure to cooperate to be a 
violation, and take such further actions as the Administrator considers 
appropriate.

    (Note: Federal criminal statutes prohibit certain interference with 
a Federal officer in the performance of official duties. 18 U.S.C. 111 
and 1114.)

    (d) No facility may intimidate, threaten, restrain, coerce, 
blacklist, discharge, or in any manner discriminate against any person 
because such person has:
    (1) Filed a complaint or appeal under or related to section 212(m) 
of the INA (8 U.S.C. 1182(m)) or subpart L or M of this part;
    (2) Testified or is about to testify in any proceeding under or 
related to section 212(m) of the INA (8 U.S.C. 1182(m)) or subpart L or 
M of this part.
    (3) Exercised or asserted on behalf of himself/herself or others any 
right or protection afforded by section 212(m) of the INA (8 U.S.C. 
1182(m)) or subpart L or M of this part.
    (4) Consulted with an employee of a legal assistance program or an 
attorney on matters related to the Act or to subparts L or M of this 
part or any

[[Page 737]]

other DOL regulation promulgated under 8 U.S.C. 1182(m).
    (5) In the event of such intimidation or restraint as are described 
in this paragraph, the Administrator may deem the conduct to be a 
violation and take such further actions as the Administrator considers 
appropriate.
    (e) A facility subject to subparts L and M of this part must 
maintain a separate file containing its Attestation and required 
documentation, and must make that file or copies thereof available to 
interested parties, as required bySec. 655.1150. In the event of a 
facility's failure to maintain the file, to provide access, or to 
provide copies, the Administrator may deem the conduct to be a violation 
and take such further actions as the Administrator considers 
appropriate.
    (f) No facility may seek to have an H-1C nurse, or any other nurse 
similarly employed by the employer, or any other employee waive rights 
conferred under the Act or under subpart L or M of this part. In the 
event of such waiver, the Administrator may deem the conduct to be a 
violation and take such further actions as the Administrator considers 
appropriate. This prohibition of waivers does not prevent agreements to 
settle litigation among private parties, and a waiver or modification of 
rights or obligations in favor of the Secretary shall be valid for 
purposes of enforcement of the provisions of the Act or subpart L and M 
of this part.
    (g) The Administrator shall, to the extent possible under existing 
law, protect the confidentiality of any complainant or other person who 
provides information to the Department.



Sec.  655.1205  What is the Administrator's responsibility with 
respect to complaints and investigations?

    (a) The Administrator, through investigation, shall determine 
whether a facility has failed to perform any attested conditions, 
misrepresented any material facts in an Attestation (including 
misrepresentation as to compliance with regulatory standards), or 
otherwise violated the Act or subpart L or M of this part. The 
Administrator's authority applies whether an Attestation is expired or 
unexpired at the time a complaint is filed. (Note: Federal criminal 
statutes provide for fines and/or imprisonment for knowing and willful 
submission of false statements to the Federal Government. 18 U.S.C. 
1001; see also 18 U.S.C. 1546.)
    (b) Any aggrieved person or organization may file a complaint of a 
violation of the provisions of section 212(m) of the INA (8 U.S.C. 
1182(m)) or subpart L or M of this part. No particular form of complaint 
is required, except that the complaint shall be written or, if oral, 
shall be reduced to writing by the Wage and Hour Division official who 
receives the complaint. The complaint must set forth sufficient facts 
for the Administrator to determine what part or parts of the Attestation 
or regulations have allegedly been violated. Upon the request of the 
complainant, the Administrator shall, to the extent possible under 
existing law, maintain confidentiality about the complainant's identity; 
if the complainant wishes to be a party to the administrative hearing 
proceedings under this subpart, the complainant shall then waive 
confidentiality. The complaint may be submitted to any local Wage and 
Hour Division office; the addresses of such offices are found in local 
telephone directories. Inquiries concerning the enforcement program and 
requests for technical assistance regarding compliance may also be 
submitted to the local Wage and Hour Division office.
    (c) The Administrator shall determine whether there is reasonable 
cause to believe that the complaint warrants investigation and, if so, 
shall conduct an investigation, within 180 days of the receipt of a 
complaint. If the Administrator determines that the complaint fails to 
present reasonable cause for an investigation, the Administrator shall 
so notify the complainant, who may submit a new complaint, with such 
additional information as may be necessary.
    (d) When an investigation has been conducted, the Administrator 
shall, within 180 days of the receipt of a complaint, issue a written 
determination, stating whether a basis exists to make a finding that the 
facility failed to meet a condition of its Attestation, made a 
misrepresentation of a material fact therein, or otherwise violated the

[[Page 738]]

Act or subpart L or M. The determination shall specify any sanctions 
imposed due to violations. The Administrator shall provide a notice of 
such determination to the interested parties and shall inform them of 
the opportunity for a hearing pursuant toSec. 655.1220.



Sec.  655.1210  What penalties and other remedies may the 
Administrator impose?

    (a) The Administrator may assess a civil money penalty not to exceed 
$1,000 per nurse per violation, with the total penalty not to exceed 
$10,000 per violation. The Administrator also may impose appropriate 
remedies, including the payment of back wages, the performance of 
attested obligations such as providing training, and reinstatement and/
or wages for laid off U.S. nurses.
    (b) In determining the amount of civil money penalty to be assessed 
for any violation, the Administrator will consider the type of violation 
committed and other relevant factors. The matters which may be 
considered include, but are not limited to, the following:
    (1) Previous history of violation, or violations, by the facility 
under the Act and subpart L or M of this part;
    (2) The number of workers affected by the violation or violations;
    (3) The gravity of the violation or violations;
    (4) Efforts made by the violator in good faith to comply with the 
Attestation as provided in the Act and subparts L and M of this part;
    (5) The violator's explanation of the violation or violations;
    (6) The violator's commitment to future compliance, taking into 
account the public health, interest, or safety; and
    (7) The extent to which the violator achieved a financial gain due 
to the violation, or the potential financial loss or potential injury or 
adverse effect upon the workers.
    (c) The civil money penalty, back wages, and any other remedy 
determined by the Administrator to be appropriate, are immediately due 
for payment or performance upon the assessment by the Administrator, or 
the decision by an administrative law judge where a hearing is 
requested, or the decision by the Secretary where review is granted. The 
facility must remit the amount of the civil money penalty, by certified 
check or money order made payable to the order of ``Wage and Hour 
Division, Labor.'' The remittance must be delivered or mailed to the 
Wage and Hour Division Regional Office for the area in which the 
violation(s) occurred. The payment of back wages, monetary relief, and/
or the performance or any other remedy prescribed by the Administrator 
will follow procedures established by the Administrator. The facility's 
failure to pay the civil money penalty, back wages, or other monetary 
relief, or to perform any other assessed remedy, will result in the 
rejection by ETA of any future Attestation submitted by the facility 
until such payment or performance is accomplished.
    (d) The Federal Civil Penalties Inflation Adjustment Act of 1990, as 
amended (28 U.S.C. 2461 note), requires that inflationary adjustments to 
civil money penalties in accordance with a specified cost-of-living 
formula be made, by regulation, at least every four years. The 
adjustments are to be based on changes in the Consumer Price Index for 
all Urban Consumers (CPI-U) for the U.S. City Average for All Items. The 
adjusted amounts will be published in the Federal Register. The amount 
of the penalty in a particular case will be based on the amount of the 
penalty in effect at the time the violation occurs.



Sec.  655.1215  How are the Administrator's investigation findings
issued?

    (a) The Administrator's determination, issued underSec. 
655.1205(d), shall be served on the complainant, the facility, and other 
interested parties by personal service or by certified mail at the 
parties' last known addresses. Where service by certified mail is not 
accepted by the party, the Administrator may exercise discretion to 
serve the determination by regular mail. Where the complainant has 
requested confidentiality, the Administrator shall serve the 
determination in a manner which will not breach that confidentiality.

[[Page 739]]

    (b) The Administrator's written determination required by Sec. 
655.1205(c) shall:
    (1) Set forth the determination of the Administrator and the reason 
or reasons therefore; prescribe any remedies or penalties including the 
amount of any unpaid wages due, the actions required for compliance with 
the facility Attestation, and the amount of any civil money penalty 
assessment and the reason or reasons therefore.
    (2) Inform the interested parties that they may request a hearing 
underSec. 655.1220.
    (3) Inform the interested parties that if a request for a hearing is 
not received by the Chief Administrative Law Judge within 15 days of the 
date of the determination, the determination of the Administrator shall 
become final and not appealable.
    (4) Set forth the procedure for requesting a hearing, and give the 
address of the Chief Administrative Law Judge.
    (5) Inform the parties that, underSec. 655.1255, the Administrator 
shall notify the Department of Homeland Security and ETA of the 
occurrence of a violation by the employer.

[75 FR 10406, Mar. 5, 2010]



Sec.  655.1220  Who can appeal the Administrator's findings and
what is the process?

    (a) Any interested party desiring review of a determination issued 
underSec. 655.1205(d), including judicial review, must make a request 
for an administrative hearing in writing to the Chief Administrative Law 
Judge at the address stated in the notice of determination. If such a 
request for an administrative hearing is timely filed, the 
Administrator's determination shall be inoperative unless and until the 
case is dismissed or the Administrative Law Judge issues an order 
affirming the decision.
    (b) An interested party may request a hearing in the following 
circumstances:
    (1) Where the Administrator determines that there is no basis for a 
finding of violation, the complainant or other interested party may 
request a hearing. In such a proceeding, the party requesting the 
hearing shall be the prosecuting party and the facility shall be the 
respondent; the Administrator may intervene as a party or appear as 
amicus curiae at any time in the proceeding, at the Administrator's 
discretion.
    (2) Where the Administrator determines that there is a basis for a 
finding of violation, the facility or other interested party may request 
a hearing. In such a proceeding, the Administrator shall be the 
prosecuting party and the facility shall be the respondent.
    (c) No particular form is prescribed for any request for hearing 
permitted by this part. However, any such request shall:
    (1) Be dated;
    (2) Be typewritten or legibly written;
    (3) Specify the issue or issues stated in the notice of 
determination giving rise to such request;
    (4) State the specific reason or reasons why the party requesting 
the hearing believes such determination is in error;
    (5) Be signed by the party making the request or by an authorized 
representative of such party; and
    (6) Include the address at which such party or authorized 
representative desires to receive further communications relating 
thereto.
    (d) The request for such hearing must be received by the Chief 
Administrative Law Judge, at the address stated in the Administrator's 
notice of determination, no later than 10 days after the date of the 
determination. An interested party which fails to meet this 10-day 
deadline for requesting a hearing may thereafter participate in the 
proceedings only by consent of the administrative law judge, either 
through intervention as a party under 29 CFR 18.10 (b) through (d) or 
through participation as an amicus curiae under 29 CFR 18.12.
    (e) The request may be filed in person, by facsimile transmission, 
by certified or regular mail, or by courier service. For the requesting 
party's protection, if the request is filed by mail, it should be 
certified mail. If the request is filed by facsimile transmission, the 
original of the request, signed by the requestor or authorized 
representative, must be filed within 10

[[Page 740]]

days of the date of the Administrator's notice of determination.
    (f) Copies of the request for a hearing must be sent by the 
requestor to the Wage and Hour Division official who issued the 
Administrator's notice of determination, to the representative(s) of the 
Solicitor of Labor identified in the notice of determination, and to all 
known interested parties.



Sec.  655.1225  What are the rules of practice before an ALJ?

    (a) Except as specifically provided in this subpart, and to the 
extent they do not conflict with the provisions of this subpart, the 
``Rules of Practice and Procedure for Administrative Hearings Before the 
Office of Administrative Law Judges'' established by the Secretary at 29 
CFR part 18 shall apply to administrative proceedings under this 
subpart.
    (b) As provided in the Administrative Procedure Act, 5 U.S.C. 556, 
any oral or documentary evidence may be received in proceedings under 
this part. The Federal Rules of Evidence and subpart B of the Rules of 
Practice and Procedure for Administrative Hearings Before the Office of 
Administrative Law Judges (29 CFR part 18, subpart B) do not apply, but 
principles designed to ensure production of relevant and probative 
evidence shall guide the admission of evidence. The administrative law 
judge may exclude evidence which is immaterial, irrelevant, or unduly 
repetitive.



Sec.  655.1230  What time limits are imposed in ALJ proceedings?

    (a) Under this subpart, a party may serve any pleading or document 
by regular mail. Service is complete upon mailing to the last known 
address. No additional time for filing or response is authorized where 
service is by mail. In the interest of expeditious proceedings, the 
administrative law judge may direct the parties to serve pleadings or 
documents by a method other than regular mail.
    (b) Two (2) copies of all pleadings and other documents in any 
administrative law judge proceeding shall be served on the attorneys for 
the Administrator. One copy must be served on the Associate Solicitor, 
Division of Fair Labor Standards, Office of the Solicitor, U.S. 
Department of Labor, 200 Constitution Avenue N.W., Washington, D.C. 
20210, and one copy on the attorney representing the Administrator in 
the proceeding.
    (c) Time will be computed beginning with the day following the 
action and includes the last day of the period unless it is a Saturday, 
Sunday, or Federally-observed holiday, in which case the time period 
includes the next business day.



Sec.  655.1235  What are the ALJ proceedings?

    (a) Upon receipt of a timely request for a hearing filed in 
accordance withSec. 655.1220, the Chief Administrative Law Judge shall 
appoint an administrative law judge to hear the case.
    (b) Within seven (7) days following the assignment of the case, the 
administrative law judge shall notify all interested parties of the 
date, time, and place of the hearing. All parties shall be given at 
least five (5) days notice of such hearing.
    (c) The date of the hearing shall be not more than 60 days from the 
date of the Administrator's determination. Because of the time 
constraints imposed by the Act, no requests for postponement shall be 
granted except for compelling reasons and by consent of all the parties 
to the proceeding.
    (d) The administrative law judge may prescribe a schedule by which 
the parties are permitted to file a pre-hearing brief or other written 
statement of fact or law. Any such brief or statement shall be served 
upon each other party in accordance withSec. 655.1230. Posthearing 
briefs will not be permitted except at the request of the administrative 
law judge. When permitted, any such brief shall be limited to the issue 
or issues specified by the administrative law judge, shall be due within 
the time prescribed by the administrative law judge, and shall be served 
on each other party in accordance withSec. 655.1230.



Sec.  655.1240  When and how does an ALJ issue a decision?

    (a) Within 90 days after receipt of the transcript of the hearing, 
the administrative law judge shall issue a decision.

[[Page 741]]

    (b) The decision of the administrative law judge shall include a 
statement of findings and conclusions, with reasons and basis therefore, 
upon each material issue presented on the record. The decision shall 
also include an appropriate order which may affirm, deny, reverse, or 
modify, in whole or in part, the determination of the Administrator; the 
reason or reasons for such order shall be stated in the decision. The 
administrative law judge shall not render determinations as to the 
legality of a regulatory provision or the constitutionality of a 
statutory provision.
    (c) The decision shall be served on all parties in person or by 
certified or regular mail.



Sec.  655.1245  Who can appeal the ALJ's decision and what is 
the process?

    (a) The Administrator or any interested party desiring review of the 
decision and order of an administrative law judge, including judicial 
review, must petition the Department's Administrative Review Board 
(Board) to review the ALJ's decision and order. To be effective, such 
petition must be received by the Board within 30 days of the date of the 
decision and order. Copies of the petition must be served on all parties 
and on the administrative law judge.
    (b) No particular form is prescribed for any petition for the 
Board's review permitted by this subpart. However, any such petition 
must:
    (1) Be dated;
    (2) Be typewritten or legibly written;
    (3) Specify the issue or issues stated in the administrative law 
judge's decision and order giving rise to such petition;
    (4) State the specific reason or reasons why the party petitioning 
for review believes such decision and order are in error;
    (5) Be signed by the party filing the petition or by an authorized 
representative of such party;
    (6) Include the address at which such party or authorized 
representative desires to receive further communications relating 
thereto; and
    (7) Attach copies of the administrative law judge's decision and 
order, and any other record documents which would assist the Board in 
determining whether review is warranted.
    (c) Whenever the Board determines to review the decision and order 
of an administrative law judge, a notice of the Board's determination 
must be served upon the administrative law judge and upon all parties to 
the proceeding within 30 days after the Board's receipt of the petition 
for review. If the Board determines that it will review the decision and 
order, the order shall be inoperative unless and until the Board issues 
an order affirming the decision and order.
    (d) Within 15 days of receipt of the Board's notice, the Office of 
Administrative Law Judges shall forward the complete hearing record to 
the Board.
    (e) The Board's notice shall specify:
    (1) The issue or issues to be reviewed;
    (2) The form in which submissions must be made by the parties (e.g., 
briefs, oral argument);
    (3) The time within which such submissions must be made.
    (f) All documents submitted to the Board must be filed with the 
Administrative Review Board, Room S-4309, U.S. Department of Labor, 
Washington, D.C. 20210. An original and two copies of all documents must 
be filed. Documents are not deemed filed with the Board until actually 
received by the Board. All documents, including documents filed by mail, 
must be received by the Board either on or before the due date.
    (g) Copies of all documents filed with the Board must be served upon 
all other parties involved in the proceeding. Service upon the 
Administrator must be in accordance withSec. 655.1230(b).
    (h) The Board's final decision shall be issued within 180 days from 
the date of the notice of intent to review. The Board's decision shall 
be served upon all parties and the administrative law judge.
    (i) Upon issuance of the Board's decision, the Board shall transmit 
the entire record to the Chief Administrative Law Judge for custody in 
accordance withSec. 655.1250.

[[Page 742]]



Sec.  655.1250  Who is the official record keeper for these 
administrative appeals?

    The official record of every completed administrative hearing 
procedure provided by subparts L and M of this part shall be maintained 
and filed under the custody and control of the Chief Administrative Law 
Judge. Upon receipt of a complaint seeking review of the final agency 
action in a United States District Court, the Chief Administrative Law 
Judge shall certify the official record and shall transmit such record 
to the clerk of the court.



Sec.  655.1255  What are the procedures for debarment of a facility 
based on a finding of violation?

    (a) The Administrator shall notify the Department of Homeland 
Security and ETA of the final determination of a violation by a facility 
upon the earliest of the following events:
    (1) Where the Administrator determines that there is a basis for a 
finding of violation by a facility, and no timely request for hearing is 
made underSec. 655.1220; or
    (2) Where, after a hearing, the administrative law judge issues a 
decision and order finding a violation by a facility, and no timely 
petition for review to the Board is made underSec. 655.1245; or
    (3) Where a petition for review is taken from an administrative law 
judge's decision and the Board either declines within 30 days to 
entertain the appeal, underSec. 655.1245(c), or the Board affirms the 
administrative law judge's determination; or
    (4) Where the administrative law judge finds that there was no 
violation by a facility, and the Board, upon review, issues a decision 
underSec. 655.1245(h), holding that a violation was committed by a 
facility.
    (b) U.S. Citizenship and Immigration Services, upon receipt of the 
Administrator's notice under paragraph (a) of this section, shall not 
approve petitions filed with respect to that employer under section 
212(m) of the INA (8 U.S.C. 1182(m)) during a period of at least 12 
months from the date of receipt of the Administrator's notification. The 
Administrator must provide USCIS with a recommendation as to the length 
of the debarment.
    (c) ETA, upon receipt of the Administrator's notice under paragraph 
(a) of this section, shall suspend the employer's attestation(s) under 
subparts L and M of this part, and shall not accept for filing any 
attestation submitted by the employer under subparts L and M of this 
part, for a period of 12 months from the date of receipt of the 
Administrator's notification or for a longer period if one is specified 
by the Department of Homeland Security for visa petitions filed by that 
employer under section 212(m) of the INA.

[75 FR 10406, Mar. 5, 2010]



Sec.  655.1260  Can Equal Access to Justice Act attorney fees 
be awarded?

    A proceeding under subpart L or M of this part is not subject to the 
Equal Access to Justice Act, as amended, 5 U.S.C. 504. In such a 
proceeding, the administrative law judge shall have no authority to 
award attorney fees and/or other litigation expenses under the 
provisions of the Equal Access to Justice Act.



    Subpart N_Labor Certification Process for Temporary Agricultural 
             Employment in the United States (H	2A Workers)

    Source: 73 FR 77207, Dec. 18, 2008, unless otherwise noted. 
Redesignated at 74 FR 25985, May 29, 2009.

    Effective Date Note: At 74 FR 25985, May 29, 2009, subpart B, 
consisting of Sec.Sec. 655.90, 655.92, 655.93, and 655.100 through 
655.119, was redesignated as subpart N, consisting of Sec.Sec. 
655.1290, 655.1292, 655.1293, and 655.1300 through 655.1319, and newly 
designated subpart N was suspended, effective June 29, 2009.



Sec.  655.1290  Purpose and scope of subpart B.

    This subpart sets out the procedures established by the Secretary of 
the United States Department of Labor (the Secretary) to acquire 
information sufficient to make factual determinations of:
    (a) Whether there are sufficient able, willing, and qualified U.S. 
workers available to perform the temporary and seasonal agricultural 
employment for which an employer desires to import nonimmigrant foreign 
workers (H-2A workers); and

[[Page 743]]

    (b) Whether the employment of H-2A workers will adversely affect the 
wages and working conditions of workers in the U.S. similarly employed.



Sec.  655.1292  Authority of ETA-OFLC.

    Temporary agricultural labor certification determinations are made 
by the Administrator, Office of Foreign Labor Certification (OFLC) in 
the Department of Labor's (the Department or DOL) Employment & Training 
Administration (ETA), who, in turn, may delegate this responsibility to 
a designated staff member; e.g., a Certifying Officer (CO).



Sec.  655.1293  Special procedures.

    (a) Systematic process. This subpart provides procedures for the 
processing of applications from agricultural employers and associations 
of employers for the certification of employment of nonimmigrant workers 
in agricultural employment.
    (b) Establishment of special procedures. To provide for a limited 
degree of flexibility in carrying out the Secretary's responsibilities 
under the Immigration and Nationality Act (INA), while not deviating 
from statutory requirements, the Administrator, OFLC has the authority 
to establish or to devise, continue, revise, or revoke special 
procedures in the form of variances for processing certain H-2A 
applications when employers can demonstrate upon written application to 
the Administrator, OFLC that special procedures are necessary. These 
include special procedures in effect for the handling of applications 
for sheepherders in the Western States (and adaptation of such 
procedures to occupations in the range production of other livestock), 
and for custom combine crews. In a like manner, for work in occupations 
characterized by other than a reasonably regular workday or workweek, 
such as the range production of sheep or other livestock, the 
Administrator, OFLC has the authority to establish monthly, weekly, or 
bi-weekly adverse effect wage rates (AEWR) for those occupations for a 
statewide or other geographical area. Prior to making determinations 
under this section, the Administrator, OFLC will consult with employer 
and worker representatives.



Sec.  655.1300  Overview of subpart B and definition of terms.

    (a) Overview--(1) Application filing process. (i) This subpart 
provides guidance to employers desiring to apply for a labor 
certification for the employment of H-2A workers to perform agricultural 
employment of a temporary or seasonal nature. The regulations in this 
subpart provide that such employers must file with the Administrator, 
OFLC an H-2A application on forms prescribed by the ETA that describe 
the material terms and conditions of employment to be offered and 
afforded to U.S. and H-2A workers. The application must be filed with 
the Administrator, OFLC at least 45 calendar days before the first date 
the employer requires the services of the H-2A workers. The application 
must contain attestations of the employer's compliance or promise to 
comply with program requirements regarding recruitment of eligible U.S. 
workers, the payment of an appropriate wage, and terms and conditions of 
employment.
    (ii) No more than 75 and no fewer than 60 calendar days before the 
first date the employer requires the services of the H-2A workers, and 
as a precursor to the filing of an Application for Temporary Employment 
Certification, the employer must initiate positive recruitment of 
eligible U.S. workers and cooperate with the local office of the State 
Workforce Agency (SWA) which serves the area of intended employment to 
place a job order into intrastate and interstate recruitment. Prior to 
commencing recruitment an employer must obtain the appropriate wage for 
the position directly from the ETA National Processing Center (NPC). The 
employer must then place a job order with the SWA; place print 
advertisements meeting the requirements of this regulation; contact 
former U.S. employees; and, when so designated by the Secretary, recruit 
in other States of traditional or expected labor supply with a 
significant number of U.S. workers who, if recruited, would be willing 
to make themselves available at the time and place needed. The SWA will 
post the job order locally, as well as in all States listed in the 
application as anticipated work sites, and in any additional States 
designated by

[[Page 744]]

the Secretary as States of traditional or expected labor supply. The SWA 
will keep the job order open until the end of the designated recruitment 
period. No more than 50 days prior to the first date the employer 
requires the services of the H-2A workers, the employer will prepare and 
sign an initial written recruitment report that it must submit with its 
Application for Temporary Employment Certification 
(www.foreignlaborcert.doleta.gov). The recruitment report must contain 
information regarding the original number of openings for which the 
employer recruited. The employer's obligation to engage in positive 
recruitment will end on the actual date on which the H-2A workers depart 
for the place of work, or 3 days prior to the first date the employer 
requires the services of the H-2A workers, whichever occurs first.
    (iii) The Application for Temporary Employment Certification must be 
filed by mail unless the Department publishes a Notice in the Federal 
Register requiring that applications be filed electronically. 
Applications that meet threshold requirements for completeness and 
accuracy will be processed by NPC staff, who will review each 
application for compliance with the criteria for certification. Each 
application must meet requirements for timeliness and temporary need and 
must provide assurances and other safeguards against adverse impact on 
the wages and working conditions of U.S. workers. Employers receiving a 
labor certification must continue to cooperate with the SWA by accepting 
referrals--and have the obligation to hire qualified and eligible U.S. 
workers who apply--until the end of the designated recruitment period.
    (2) Deficient applications. The CO will promptly review the 
application and notify the applicant in writing if there are 
deficiencies that render the application not acceptable for 
certification, and afford the applicant a 5 calendar day period (from 
date of the employer's receipt) to resubmit a modified application or to 
file an appeal of the CO's decision not to approve the application as 
acceptable for consideration. Modified applications that fail to cure 
deficiencies will be denied.
    (3) Amendment of applications. This subpart provides for the 
amendment of applications. Where the recruitment is not materially 
affected by such amendments, additional positive recruitment will not be 
required.
    (4) Determinations--(i) Determinations. If the employer has complied 
with the criteria for certification, including recruitment of eligible 
U.S. workers, the CO must make a determination on the application by 30 
days before the first date the employer requires the services of the H-
2A workers. An employer's failure to comply with any of the 
certification criteria or to cure deficiencies identified by the CO may 
lengthen the time required for processing, resulting in a final 
determination less than 30 days prior to the stated date of need.
    (ii) Certified applications. This subpart provides that an 
application for temporary agricultural labor certification will be 
certified if the CO finds that the employer has not offered and does not 
intend to offer foreign workers higher wages, better working conditions, 
or fewer restrictions than those offered and afforded to U.S. workers; 
that sufficient U.S. workers who are able, willing, qualified, and 
eligible will not be available at the time and place needed to perform 
the work for which H-2A workers are being requested; and that the 
employment of such nonimmigrants will not adversely affect the wages and 
working conditions of similarly employed U.S. workers.
    (iii) Fees--(A) Amount. This subpart provides that each employer 
(except joint employer associations) of H-2A workers will pay the 
appropriate fees to the Department for each temporary agricultural labor 
certification received.
    (B) Timeliness of payment. The fee must be received by the CO no 
later than 30 calendar days after the granting of each temporary 
agricultural labor certification. Fees received any later are untimely. 
A persistent or prolonged failure to pay fees in a timely manner is a 
substantial program violation which may result in the denial of future 
temporary agricultural labor certifications and/or program debarment.

[[Page 745]]

    (iv) Denied applications. This subpart provides that if the 
application for temporary agricultural labor certification is denied, in 
whole or in part, the employer may seek expedited review of the denial, 
or a de novo hearing, by an administrative law judge as provided in this 
subpart.
    (b) Transition of filing procedures from current regulations--(1) 
Compliance with these regulations. Employers with a date of need for H-
2A workers for temporary or seasonal agricultural services on or after 
January 1, 2010 must comply with all of the obligations and assurances 
required in this subpart.
    (2) Transition from former regulations. Employers with a date of 
need for H-2A workers for temporary or seasonal agricultural services 
prior to January 1, 2010 will file applications in the following manner:
    (i) Obtaining required wage rate. An employer will not obtain an 
offered wage rate through the NPC prior to filing an application, but 
will complete and submit Form ETA-9142, Application for Temporary 
Employment Certification no less than 45 days prior to their date of 
need. The employer will simultaneously submit Form ETA-790 Agricultural 
and Food Processing Clearance Order, along with the Application for 
Temporary Employment Certification, directly to the NPC having 
jurisdiction over H-2A applications.
    (ii) Pre-filing activities. Activities required to be conducted 
prior to filing under the final rule will be conducted post-filing 
during this transition period. The employer will be expected to make 
attestations in its application applicable to its future activities 
concerning recruitment, payment of the offered wage rate, etc. Employers 
will not be required to complete an initial recruitment report for 
submission with the application, but will be required to complete a 
recruitment report for submission to the NPC prior to certification, and 
will also be required to complete a final recruitment report covering 
the entire recruitment period.
    (iii) Acceptance of application. Upon receipt, the NPC will provide 
the employer with the wage rate to be offered, at a minimum, by the 
employer, and will process the application in a manner consistent with 
newSec. 655.107, issuing a notification of deficiencies for any 
curable deficiencies within 7 calendar days.
    (iv) Processing of application. Once the application and job order 
have been accepted, the NPC will transmit a copy of the job order to the 
SWA(s) serving the area of intended employment to initiate intrastate 
and interstate clearance, request that the SWA(s) schedule an inspection 
of the housing, and provide instructions to the employer to commence 
positive recruitment in a manner consistent withSec. 655.102(d)(2) 
through (4). The NPC will designate labor supply States during this 
period on a case-by-case basis. Such designations must be based on 
information provided by State agencies or by other sources, and will to 
the extent information is available take into account the success of 
recent efforts by out-of-State employers to recruit in that State.
    (c) Definitions of terms used in this subpart. For the purposes of 
this subpart:
    Administrative Law Judge (ALJ) means a person within the DOL's 
Office of Administrative Law Judges appointed pursuant to 5 U.S.C. 3105, 
or a panel of such persons designated by the Chief Administrative Law 
Judge from the Board of Alien Labor Certification Appeals (BALCA) 
established by part 656 of this chapter, which will hear and decide 
appeals as set forth inSec. 655.115.
    Administrator, OFLC means the primary official of the Office of 
Foreign Labor Certification (OFLC), or the Administrator, OFLC 's 
designee.
    Adverse effect wage rate (AEWR) means the minimum wage rate that the 
Administrator, OFLC has determined must be offered and paid to every H-
2A worker employed under the DOL-approved Application for Temporary 
Employment Certification in a particular occupation and/or area, as well 
as to U.S. workers hired by employers into corresponding employment 
during the H-2A recruitment period, to ensure that the wages of 
similarly employed U.S. workers will not be adversely affected.
    Agent means a legal entity or person, such as an association of 
agricultural employers, or an attorney for an association, that:

[[Page 746]]

    (1) Is authorized to act on behalf of the employer for temporary 
agricultural labor certification purposes;
    (2) Is not itself an employer, or a joint employer, as defined in 
this paragraph (c) of this section with respect to a specific 
application; and
    (3) Is not under suspension, debarment, expulsion, or disbarment 
from practice before any court or the Department, the Board of 
Immigration Appeals, the immigration judges, or the Department of 
Homeland Security (DHS) under 8 CFR 292.3 or 1003.101.
    Agricultural association means any nonprofit or cooperative 
association of farmers, growers, or ranchers (including but not limited 
to processing establishments, canneries, gins, packing sheds, nurseries, 
or other fixed-site agricultural employers), incorporated or qualified 
under applicable State law, that recruits, solicits, hires, employs, 
furnishes, houses or transports any worker that is subject to sec. 218 
of the INA. An agricultural association may act as the agent of an 
employer for purposes of filing an Application for Temporary Employment 
Certification, and may also act as the sole or joint employer of H-2A 
workers.
    Application for Temporary Employment Certification means the Office 
of Management and Budget (OMB)-approved form submitted by an employer to 
secure a temporary agricultural labor certification determination from 
DOL. A complete submission of the Application for Temporary Employment 
Certification includes both the form and the employer's initial 
recruitment report.
    Area of intended employment means the geographic area within normal 
commuting distance of the place (worksite address) of the job 
opportunity for which the certification is sought. There is no rigid 
measure of distance which constitutes a normal commuting distance or 
normal commuting area, because there may be widely varying factual 
circumstances among different areas (e.g., average commuting times, 
barriers to reaching the worksite, quality of the regional 
transportation network, etc.). If the place of intended employment is 
within a Metropolitan Statistical Area (MSA), including a multistate 
MSA, any place within the MSA is deemed to be within normal commuting 
distance of the place of intended employment. The borders of MSAs are 
not controlling in the identification of the normal commuting area; a 
location outside of an MSA may be within normal commuting distance of a 
location that is inside (e.g., near the border of) the MSA.
    Attorney means any person who is a member in good standing of the 
bar of the highest court of any State, possession, territory, or 
commonwealth of the U.S., or the District of Columbia, and who is not 
under suspension, debarment, expulsion, or disbarment from practice 
before any court or the Department, the Board of Immigration Appeals, 
the immigration judges, or DHS under 8 CFR. 292.3 or 1003.101. Such a 
person is permitted to act as an agent or attorney for an employer and/
or foreign worker under this subpart.
    Certifying Officer (CO) means the person designated by the 
Administrator, OFLC to make determinations on applications filed under 
the H-2A program.
    Chief Administrative Law Judge means the chief official of the DOL 
Office of Administrative Law Judges or the Chief Administrative Law 
Judge's designee.
    Date of need means the first date the employer requires the services 
of H-2A worker as indicated in the employer's Application for Temporary 
Employment Certification.
    Department of Homeland Security (DHS) means the Federal agency 
having control over certain immigration functions that, through its sub-
agency, United States Citizenship and Immigration Services (USCIS), 
makes the determination under the INA on whether to grant visa petitions 
filed by employers seeking H-2A workers to perform temporary 
agricultural work in the U.S.
    DOL or Department means the United States Department of Labor.
    Eligible worker means an individual who is not an unauthorized alien 
(as defined in sec. 274A(h)(3) of the INA, 8 U.S.C. 1324a(h)(3)) with 
respect to the employment in which the worker is engaging.
    Employee means employee as defined under the general common law of 
agency. Some of the factors relevant to the

[[Page 747]]

determination of employee status include: the hiring party's right to 
control the manner and means by which the work is accomplished; the 
skill required to perform the work; the source of the instrumentalities 
and tools for accomplishing the work; the location of the work; the 
hiring party's discretion over when and how long to work; and whether 
the work is part of the regular business of the hiring party. Other 
applicable factors may be considered and no one factor is dispositive.
    Employer means a person, firm, corporation or other association or 
organization that:
    (1) Has a place of business (physical location) in the U.S. and a 
means by which it may be contacted for employment;
    (2) Has an employer relationship with respect to H-2A employees or 
related U.S. workers under this subpart; and
    (3) Possesses, for purposes of filing an Application for Temporary 
Employment Certification, a valid Federal Employer Identification Number 
(FEIN).
    Employment Standards Administration (ESA) means the agency within 
DOL that includes the Wage and Hour Division (WHD), and which is charged 
with carrying out certain investigative and enforcement functions of the 
Secretary under the INA.
    Employment Service (ES) refers to the system of Federal and State 
entities responsible for administration of the labor certification 
process for temporary and seasonal agricultural employment of 
nonimmigrant foreign workers. This includes the SWAs and the OFLC, 
including the NPCs.
    Employment and Training Administration (ETA) means the agency within 
the DOL that includes OFLC.
    Federal holiday means a legal public holiday as defined at 5 U.S.C. 
6103.
    Fixed-site employer means any person engaged in agriculture who 
meets the definition of an employer as those terms are defined in this 
subpart who owns or operates a farm, ranch, processing establishment, 
cannery, gin, packing shed, nursery, or other similar fixed-site 
location where agricultural activities are performed and who recruits, 
solicits, hires, employs, houses, or transports any worker subject to 
sec. 218 of the INA or these regulations as incident to or in 
conjunction with the owner's or operator's own agricultural operation. 
For purposes of this subpart, person includes any individual, 
partnership, association, corporation, cooperative, joint stock company, 
trust, or other organization with legal rights and duties.
    H-2A Labor Contractor (H-2ALC) means any person who meets the 
definition of employer under this paragraph (c) of this section and is 
not a fixed-site employer, an agricultural association, or an employee 
of a fixed-site employer or agricultural association, as those terms are 
used in this part, who recruits, solicits, hires, employs, furnishes, 
houses, or transports any worker subject to sec. 218 of the INA or these 
regulations.
    H-2A worker means any temporary foreign worker who is lawfully 
present in the U.S. to perform agricultural labor or services of a 
temporary or seasonal nature pursuant to sec. 101(a)(15)(H)(ii)(a) of 
the INA, as amended.
    INA means the Immigration and Nationality Act, as amended, 8 U.S.C. 
1101 et seq.
    Job offer means the offer made by an employer or potential employer 
of H-2A workers to eligible workers describing all the material terms 
and conditions of employment, including those relating to wages, working 
conditions, and other benefits.
    Job opportunity means a job opening for temporary, full-time 
employment at a place in the U.S. to which a U.S. worker can be 
referred.
    Joint employment means that where two or more employers each have 
sufficient definitional indicia of employment to be considered the 
employer of an employee, those employers will be considered to jointly 
employ that employee. Each employer in a joint employment relationship 
to an employee is considered a joint employer of that employee.
    Occupational Safety and Health Administration (OSHA) means the 
organizational component of the Department that assures the safety and 
health of America's workers by setting and enforcing standards; 
providing training, outreach, and education; establishing

[[Page 748]]

partnerships; and encouraging continual improvement in workplace safety 
and health under the Occupational Safety and Health Act, as amended.
    Office of Foreign Labor Certification (OFLC) means the 
organizational component of the ETA that provides national leadership 
and policy guidance and develops regulations and procedures to carry out 
the responsibilities of the Secretary under the INA concerning the 
admission of foreign workers to the U.S. to perform work described in 
sec. 101(a)(15)(H)(ii)(a) of the INA, as amended.
    Positive recruitment means the active participation of an employer 
or its authorized hiring agent in recruiting and interviewing qualified 
and eligible individuals in the area where the employer's job 
opportunity is located and any other State designated by the Secretary 
as an area of traditional or expected labor supply with respect to the 
area where the employer's job opportunity is located, in an effort to 
fill specific job openings with U.S. workers.
    Prevailing means, with respect to practices engaged in by employers 
and benefits other than wages provided by employers, that:
    (1) Fifty percent or more of employers in an area and for an 
occupation engage in the practice or offer the benefit; but only if
    (2) This 50 percent or more of employers also employs in aggregate 
50 percent or more of U.S. workers in the occupation and area (including 
H-2A and non-H-2A employers for purposes of determinations concerning 
the provision of family housing, frequency of wage payments, and workers 
supplying their own bedding, but non-H-2A employers only for 
determinations concerning the provision of advance transportation).
    Prevailing piece rate means that amount that is typically paid to an 
agricultural worker per piece (which includes, but is not limited to, a 
load, bin, pallet, bag, bushel, etc.), to be determined by the SWA 
according to a methodology published by the Department. As is currently 
the case, the unit of production will be required to be clearly 
described; e.g., a field box of oranges (1\1/2\ bushels), a bushel of 
potatoes, and Eastern apple box (1\1/2\ metric bushels), a flat of 
strawberries (twelve quarts), etc.
    Prevailing hourly wage means the hourly wage determined by the SWA 
to be prevailing in the area in accordance with State-based wage 
surveys.
    Representative means a person or entity employed by, or duly 
authorized to act on behalf of, the employer with respect to activities 
entered into for, and/or attestations made with respect to, the 
Application for Temporary Employment Certification.
    Secretary means the Secretary of the United States Department of 
Labor, or the Secretary's designee.
    Secretary of Homeland Security means the chief official of the 
United States Department of Homeland Security (DHS) or the Secretary of 
Homeland Security's designee.
    Secretary of State means the chief official of the United States 
Department of State (DOS) or the Secretary of State's designee.
    State Workforce Agency (SWA) means the State government agency that 
receives funds pursuant to the Wagner-Peyser Act to administer the 
public labor exchange delivered through the State's One-Stop delivery 
system in accordance with the Wagner-Peyser Act at 29 U.S.C. 49 et seq. 
Separately, SWAs receive ETA grants, administered by OFLC, to assist 
them in performing certain activities related to foreign labor 
certification, including conducting housing inspections.
    Strike means a labor dispute wherein employees engage in a concerted 
stoppage of work (including stoppage by reason of the expiration of a 
collective-bargaining agreement) or engage in any concerted slowdown or 
other concerted interruption of operation. Whether a job opportunity is 
vacant by reason of a strike or lock out will be determined by 
evaluating for each position identified as vacant in the Application for 
Temporary Employment Certification whether the specific vacancy has been 
caused by the strike or lock out.
    Successor in interest means that, in determining whether an employer 
is a successor in interest, the factors used under Title VII of the 
Civil Rights Act

[[Page 749]]

and the Vietnam Era Veterans' Readjustment Assistance Act will be 
considered. When considering whether an employer is a successor for 
purposes ofSec. 655.118, the primary consideration will be the 
personal involvement of the firm's ownership, management, supervisors, 
and others associated with the firm in the violations resulting in a 
debarment recommendation. Normally, wholly new management or ownership 
of the same business operation, one in which the former management or 
owner does not retain a direct or indirect interest, will not be deemed 
to be a successor in interest for purposes of debarment. A determination 
of whether or not a successor in interest exists is based on the entire 
circumstances viewed in their totality. The factors to be considered 
include:
    (1) Substantial continuity of the same business operations;
    (2) Use of the same facilities;
    (3) Continuity of the work force;
    (4) Similarity of jobs and working conditions;
    (5) Similarity of supervisory personnel;
    (6) Similarity in machinery, equipment, and production methods;
    (7) Similarity of products and services; and
    (8) The ability of the predecessor to provide relief.
    Temporary agricultural labor certification means the certification 
made by the Secretary with respect to an employer seeking to file with 
DHS a visa petition to employ one or more foreign nationals as an H-2A 
worker, pursuant to secs. 101(a)(15)(H)(ii)(a), 214(a) and (c), and 218 
of the INA that:
    (1) There are not sufficient workers who are able, willing, and 
qualified, and who will be available at the time and place needed, to 
perform the agricultural labor or services involved in the petition, and
    (2) The employment of the foreign worker in such agricultural labor 
or services will not adversely affect the wages and working conditions 
of workers in the U.S. similarly employed (8 U.S.C. 
1101(a)(15)(H)(ii)(a), 1184(a) and (c), and 1188).
    United States (U.S.), when used in a geographic sense, means the 
continental United States, Alaska, Hawaii, the Commonwealth of Puerto 
Rico, and the territories of Guam, the Virgin Islands, and, as of the 
transition program effective date, as defined in the Consolidated 
Natural Resources Act of 2008, Public Law 110-229, Title VII, the 
Commonwealth of the Northern Mariana Islands.
    United States Citizenship and Immigration Services (USCIS) means the 
Federal agency making the determination under the INA whether to grant 
petitions filed by employers seeking H-2A workers to perform temporary 
agricultural work in the U.S.
    United States worker (U.S. worker) means a worker who is
    (1) A citizen or national of the U.S., or
    (2) An alien who is lawfully admitted for permanent residence in the 
U.S., is admitted as a refugee under sec. 207 of the INA, is granted 
asylum under sec. 208 of the INA, or is an immigrant otherwise 
authorized (by the INA or by DHS) to be employed in the U.S.
    Wages means all forms of cash remuneration to a worker by an 
employer in payment for personal services.
    Within [number and type] days means, for purposes of determining an 
employer's compliance with the timing requirements for appeals and 
requests for review, a period that begins to run on the first business 
day after the Department sends a notice to the employer by means 
normally assuring next-day delivery, and will end on the day that the 
employer sends whatever communication is required by these rules back to 
the Department, as evidenced by a postal mark or other similar receipt.
    Work contract means all the material terms and conditions of 
employment relating to wages, hours, working conditions, and other 
benefits, required by the applicable regulations in Subpart B of 20 CFR 
part 655, Labor Certification for Temporary Agricultural Employment of 
H-2A Aliens in the U.S. (H-2A Workers), or these regulations, including 
those terms and conditions attested to by the H-2A employer, which 
contract between the employer and the worker may be in the form of a 
separate written document. In the absence of a separate written work 
contract incorporating the required terms and conditions of employment, 
agreed to by both

[[Page 750]]

the employer and the worker, the work contract at a minimum shall be the 
terms of the job order, as provided in 20 CFR part 653, Subpart F, and 
covered provisions of the work contract shall be enforced in accordance 
with these regulations.
    (d) Definition of agricultural labor or services of a temporary or 
seasonal nature. For the purposes of this subpart means the following:
    (1) Agricultural labor or services, pursuant to sec. 
101(a)(15)(H)(ii)(a) of the INA at 8 U.S.C. 1101(a)(15)(H)(ii)(a), is 
defined as:
    (i) Agricultural labor as defined and applied in sec. 3121(g) of the 
Internal Revenue Code of 1954 at 26 U.S.C. 3121(g);
    (ii) Agriculture as defined and applied in sec. 3(f) of the Fair 
Labor Standards Act of 1938 (FLSA) at 29 U.S.C. 203(f). Work performed 
by H-2A workers, or workers in corresponding employment, that is not 
defined as agriculture in sec. 3(f) is subject to the provisions of the 
FLSA as provided therein, including the overtime provisions in sec. 7(a) 
29 U.S.C. 207(a);
    (iii) The pressing of apples for cider on a farm;
    (iv) Logging employment; or
    (v) Handling, planting, drying, packing, packaging, processing, 
freezing, grading, storing, or delivering to storage or to market or to 
a carrier for transportation to market, in its unmanufactured state, any 
agricultural or horticultural commodity while in the employ of the 
operator of a farm where no H-2B workers are employed to perform the 
same work at the same establishment; or
    (vi) Other work typically performed on a farm that is not 
specifically listed on the Application for Temporary Employment 
Certification and is minor (i.e., less than 20 percent of the total time 
worked on the job duties and activities that are listed on the 
Application for Temporary Employment Certification) and incidental to 
the agricultural labor or services for which the H-2A worker was sought.
    (2) An occupation included in either of the statutory definitions 
cited in paragraphs (d)(1)(i) and (ii) of this section is agricultural 
labor or services, notwithstanding the exclusion of that occupation from 
the other statutory definition.
    (i) Agricultural labor. For purposes of paragraph (d)(1)(i) of this 
section means all services performed:
    (A) On a farm, in the employ of any person, in connection with 
cultivating the soil, or in connection with raising or harvesting any 
agricultural or horticultural commodity, including the raising, 
shearing, feeding, caring for, training, and management of livestock, 
bees, poultry, and furbearing animals and wildlife;
    (B) In the employ of the owner or tenant or other operator of a 
farm, in connection with the operation or maintenance of such farm and 
its tools and equipment, or in salvaging timber or clearing land of 
brush and other debris left by a hurricane, if the major part of such 
service is performed on a farm;
    (C) In connection with the production or harvesting of any commodity 
defined as an agricultural commodity in sec. 15(g) of the Agricultural 
Marketing Act, as amended at 12 U.S.C. 1141j, or in connection with the 
ginning of cotton, or in connection with the operation or maintenance of 
ditches, canals, reservoirs, or waterways, not owned or operated for 
profit, used exclusively for supplying and storing water for farming 
purposes;
    (D)(1) In the employ of the operator of a farm in handling, 
planting, drying, packing, packaging, processing, freezing, grading, 
storing, or delivering to storage or to market or to a carrier for 
transportation to market, in its unmanufactured state, any agricultural 
or horticultural commodity, but only if such operator produced more than 
one-half of the commodity with respect to which such service is 
performed;
    (2) In the employ of a group of operators of farms (other than a 
cooperative organization) in the performance of service described in 
paragraph (d)(2)(i)(D)(1) of this section, but only if such operators 
produced all of the commodity with respect to which such service is 
performed. For purposes of this paragraph, any unincorporated group of 
operators will be deemed a cooperative organization if the number of 
operators comprising such group is more than 20 at any time during the

[[Page 751]]

calendar quarter in which such service is performed;
    (3) The provisions of paragraphs (d)(2)(i)(D)(1) and (2) of this 
section do not apply to services performed in connection with commercial 
canning or commercial freezing or in connection with any agricultural or 
horticultural commodity after its delivery to a terminal market for 
distribution for consumption; or
    (4) On a farm operated for profit if such service is not in the 
course of the employer's trade or business and is not domestic service 
in a private home of the employer.
    (E) For purposes of (d)(2)(i) of this section, the term farm 
includes stock, dairy, poultry, fruit, fur-bearing animal, and truck 
farms, plantations, ranches, nurseries, ranges, greenhouses or other 
similar structures used primarily for the raising of agricultural or 
horticultural commodities, and orchards. See sec. 3121(g) of the 
Internal Revenue Code of 1986 at 26 U.S.C. 3121(g).
    (ii) Agriculture. For purposes of paragraph (d)(1)(ii) of this 
section agriculture means farming in all its branches and among other 
things includes the cultivation and tillage of the soil, dairying, the 
production, cultivation, growing, and harvesting of any agricultural or 
horticultural commodities (including commodities as defined as 
agricultural commodities in 12 U.S.C. 1141j(g)), the raising of 
livestock, bees, fur-bearing animals, or poultry, and any practices 
(including any forestry or lumbering operations) performed by a farmer 
or on a farm as an incident to or in conjunction with such farming 
operations, including preparation for market, delivery to storage or to 
market or to carriers for transportation to market. See 29 U.S.C. 
203(f), as amended.
    (iii) Agricultural commodity. For purposes of paragraph (d)(2)(ii) 
of this section agricultural commodity includes, in addition to other 
agricultural commodities, crude gum (oleoresin) from a living tree, and 
gum spirits of turpentine and gum rosin as processed by the original 
producer of the crude gum (oleoresin) from which derived. Gum spirits of 
turpentine means spirits of turpentine made from gum (oleoresin) from a 
living tree and gum rosin means rosin remaining after the distillation 
of gum spirits of turpentine. See 12 U.S.C. 1141j(g), sec. 15(g) of the 
Agricultural Marketing Act, as amended, and 7 U.S.C. 92.
    (3) Of a temporary or seasonal nature--(i) On a seasonal or other 
temporary basis. For the purposes of this subpart, of a temporary or 
seasonal nature means on a seasonal or other temporary basis, as defined 
in the WHD's regulation at 29 CFR 500.20 under the Migrant and Seasonal 
Agricultural Worker Protection Act (MSPA).
    (ii) MSPA definition. The definition of on a seasonal or other 
temporary basis found in MSPA is summarized as follows:
    (A) Labor is performed on a seasonal basis where, ordinarily, the 
employment pertains to or is of the kind exclusively performed at 
certain seasons or periods of the year and which, from its nature, may 
not be continuous or carried on throughout the year. A worker who moves 
from one seasonal activity to another, while employed in agriculture or 
performing agricultural labor, is employed on a seasonal basis even 
though the worker may continue to be employed during a major portion of 
the year.
    (B) A worker is employed on other temporary basis where he or she is 
employed for a limited time only or the worker's performance is 
contemplated for a particular piece of work, usually of short duration. 
Generally, employment which is contemplated to continue indefinitely is 
not temporary.
    (C) On a seasonal or other temporary basis does not include (i) the 
employment of any foreman or other supervisory employee who is employed 
by a specific agricultural employer or agricultural association 
essentially on a year round basis; or (ii) the employment of any worker 
who is living at his or her permanent place of residence, when that 
worker is employed by a specific agricultural employer or agricultural 
association on essentially a year round basis to perform a variety of 
tasks for his or her employer and is not primarily employed to do field 
work.

[[Page 752]]

    (iii) Temporary. For the purposes of this subpart, the definition of 
``temporary'' in paragraph (d)(3) of this section refers to any job 
opportunity covered by this subpart where the employer needs a worker 
for a position for a limited period of time, including, but not limited 
to, a peakload need, which is generally less than 1 year, unless the 
original temporary agricultural labor certification is extended pursuant 
toSec. 655.110.

[73 FR 77207, Dec. 18, 2008, as amended at 74 FR 17601, Apr. 16, 2009]



Sec.  655.1301  Applications for temporary employment certification
in agriculture.

    (a) Application filing requirements. (1) An employer that desires to 
apply for temporary employment certification of one or more nonimmigrant 
foreign workers must file a completed DOL Application for Temporary 
Employment Certification form and, unless a specific exemption applies, 
the initial recruitment report. If an association of agricultural 
producers files the application, the association must identify whether 
it is the sole employer, a joint employer with its employer-member 
employers, or the agent of its employer-members. The association must 
retain documentation substantiating the employer or agency status of the 
association and be prepared to submit such documentation to the CO in 
the event of an audit.
    (2) If an H-2ALC intends to file an application, the H-2ALC must 
meet all of the requirements of the definition of employer inSec. 
655.100(b), and comply with all the assurances, guarantees, and other 
requirements contained in this part and in part 653, subpart F, of this 
chapter. The H-2ALC must have a place of business (physical location) in 
the U.S. and a means by which it may be contacted for employment. H-2A 
workers employed by an H-2ALC may not perform services for a fixed-site 
employer unless the H-2ALC is itself providing the housing and 
transportation required bySec. 655.104(d) and (h), or has filed a 
statement confirming that the fixed-site employer will provide compliant 
housing and/or transportation, as required bySec. 655.106, with the 
OFLC, for each fixed-site employer listed on the application. The H-2ALC 
must retain a copy of the statement of compliance required bySec. 
655.106(b)(6).
    (3) An association of agricultural producers may submit a master 
application covering a variety of job opportunities available with a 
number of employers in multiple areas of intended employment, just as 
though all of the covered employers were in fact a single employer, as 
long as a single date of need is provided for all workers requested by 
the application and the combination of job opportunities is supported by 
an explanation demonstrating a business reason for the combination. The 
association must identify on the Application for Temporary Employment 
Certification, by name and address, each employer that will employ H-2A 
workers. If the association is acting solely as an agent, each employer 
will receive a separate labor certification.
    (b) Filing. The employer may send the Application for Temporary 
Employment Certification and all supporting documentation by U.S. Mail 
or private mail courier to the NPC. The Department will publish a Notice 
in the Federal Register identifying the address(es), and any future 
address changes, to which applications must be mailed, and will also 
post these addresses on the DOL Internet Web site at http://
www.foreignlaborcert.doleta.gov/. The form must bear the original 
signature of the employer (and that of the employer's authorized 
attorney or agent if the employer is represented by an attorney or 
agent). An association filing a master application as a joint employer 
may sign on behalf of its employer members. The Department may also 
require applications to be filed electronically in addition to or 
instead of by mail.
    (c) Timeliness. A completed Application for Temporary Employment 
Certification must be filed no less than 45 calendar days before date of 
need.
    (d) Emergency situations--(1) Waiver of time period and required 
pre-filing activity. The CO may waive the time period for filing and 
pre-filing wage and recruitment requirements set forth inSec. 655.102, 
along with their associated attestations, for employers who did not

[[Page 753]]

make use of temporary alien agricultural workers during the prior year's 
agricultural season or for any employer that has other good and 
substantial cause (which may include unforeseen changes in market 
conditions), provided that the CO can timely make the determinations 
required bySec. 655.109(b).
    (2) Employer requirements. The employer requesting a waiver of the 
required time period and pre-filing wage and recruitment requirements 
must submit to the NPC a completed Application for Temporary Employment 
Certification, a completed job offer on the ETA Form 790 Agricultural 
and Food Processing Clearance Order, and a statement justifying the 
request for a waiver of the time period requirement. The statement must 
indicate whether the waiver request is due to the fact that the employer 
did not use H-2A workers during the prior agricultural season or whether 
the request is for other good and substantial cause. If the waiver is 
requested for good and substantial cause, the employer's statement must 
also include detailed information describing the good and substantial 
cause which has necessitated the waiver request. Good and substantial 
cause may include, but is not limited to, such things as the substantial 
loss of U.S. workers due to weather-related activities or other reasons, 
unforeseen events affecting the work activities to be performed, 
pandemic health issues, or similar conditions.
    (3) Processing of applications. The CO shall promptly transmit the 
job order, on behalf of the employer, to the SWA serving the area of 
intended employment and request an expedited review of the job order in 
accordance withSec. 655.102(e) and an inspection of housing in 
accordance withSec. 655.104(d)(6)(iii). The CO shall process the 
application and job order in accordance withSec. 655.107, issue a wage 
determination in accordance withSec. 655.108 and, upon acceptance, 
require the employer to engage in positive recruitment consistent with 
Sec.  655.102(d)(2), (3), and (4). The CO shall require the SWA to 
transmit the job order for interstate clearance consistent withSec. 
655.102(f). The CO shall specify a date on which the employer will be 
required to submit a recruitment report in accordance withSec. 
655.102(k). The CO will make a determination on the application in 
accordance withSec. 655.109.



Sec.  655.1302  Required pre-filing activity.

    (a) Time of filing of application. An employer may not file an 
Application for Temporary Employment Certification before all of the 
pre-filing recruitment steps set forth in this section have been fully 
satisfied, except where specifically exempted from some or all of those 
requirements by these regulations. Modifications to these requirements 
for H-2ALCs are set forth inSec. 655.106.
    (b) General attestation obligation. An employer must attest on the 
Application for Temporary Employment Certification that it will comply 
with all of the assurances and obligations of this subpart and to 
performing all necessary steps of the recruitment process as specified 
in this section.
    (c) Retention of documentation. An employer filing an Application 
for Temporary Employment Certification must maintain documentation of 
its advertising and recruitment efforts as required in this subpart and 
be prepared to submit this documentation in response to a Notice of 
Deficiency from the CO prior to the CO rendering a Final Determination, 
or in the event of an audit. The documentation required in this subpart 
must be retained for a period of no less than 3 years from the date of 
the certification. There is no record retention requirement for any 
application (and supporting documentation) after the Secretary has made 
a final decision to deny the application.
    (d) Positive recruitment steps. An employer filing an application 
must:
    (1) Submit a job order to the SWA serving the area of intended 
employment;
    (2) Run two print advertisements (one of which must be on a Sunday, 
except as provided in paragraph (g) of this section);
    (3) Contact former U.S. employees who were employed within the last 
year as described in paragraph (h) of this section; and
    (4) Based on an annual determination made by the Secretary, as 
described in

[[Page 754]]

paragraph (i) of this section, recruit in all States currently 
designated as a State of traditional or expected labor supply with 
respect to each area of intended employment in which the employer's work 
is to be performed as required in paragraph (i)(2) of this section.
    (e) Job order. (1) The employer must submit a job order to the SWA 
serving the area of intended employment no more than 75 calendar days 
and no fewer than 60 calendar days before the date of need for 
intrastate and interstate clearance, identifying it as a job order to be 
placed in connection with a future application for H-2A workers. If the 
job opportunity is located in more than one State, the employer may 
submit a job order to any one of the SWAs having jurisdiction over the 
anticipated worksites. Where a future master application will be filed 
by an association of agricultural employers, the SWA will prepare a 
single job order in the name of the association on behalf of all 
employers that will be duly named on the Application for Temporary 
Employment Certification. Documentation of this step by the applicant is 
satisfied by maintaining proof of posting from the SWA identifying the 
job order number(s) with the start and end dates of the posting of the 
job order.
    (2) The job order submitted to the SWA must satisfy all the 
requirements for newspaper advertisements contained inSec. 655.103 and 
comply with the requirements for agricultural clearance orders in 20 CFR 
part 653 Subpart F and the requirements set forth inSec. 655.104.
    (3) The SWA will review the contents of the job order as provided in 
20 CFR part 653 Subpart F and will work with the employer to address any 
deficiencies, except that the order may be placed prior to completion of 
the housing inspection required by 20 CFR 653.501(d)(6) where necessary 
to meet the timeframes required by statute and regulation. However, the 
SWA must ensure that housing within its jurisdiction is inspected as 
expeditiously as possible thereafter. Any issue with regard to whether a 
job order may properly be placed in the job service system that cannot 
be resolved with the applicable SWA may be brought to the attention of 
the NPC, which may direct that the job order be placed in the system 
where the NPC determines that the applicable program requirements have 
been met. If the NPC concludes that the job order is not acceptable, it 
shall so inform the employer using the procedures applicable to a denial 
of certification set forth inSec. 655.109(e).
    (f) Intrastate/Interstate recruitment. (1) Upon receipt and 
acceptance of the job order, the SWA must promptly place the job order 
in intrastate clearance on its active file and begin recruitment of 
eligible U.S. workers. The SWA receiving the job order under paragraph 
(e) of this section will promptly transmit, on behalf of the employer, a 
copy of its active job order to all States listed in the job order as 
anticipated worksites. The SWA must also transmit a copy of all active 
job orders to no fewer than three States, which must include those 
States, if any, designated by the Secretary as traditional or expected 
labor supply States (``out-of-State recruitment States'') for the area 
of intended employment in which the employer's work is to be performed 
as defined in paragraph (i) of this section.
    (2) Unless otherwise directed by the CO, the SWA must keep the job 
order open for interstate clearance until the end of the recruitment 
period, as set forth inSec. 655.102(f)(3). Each of the SWAs to which 
the job order was referred must keep the job order open for that same 
period of time and must refer each eligible U.S. worker who applies (or 
on whose behalf an application is made) for the job opportunity.
    (3)(i) For the first 5 years after the effective date of this rule, 
the recruitment period shall end 30 days after the first date the 
employer requires the services of the H-2A workers, or on the last day 
the employer requires the services of H-2A workers in the applicable 
area of intended employment, whichever is sooner (the 30-day rule). 
During that 5-year period, the Department will endeavor to study the 
costs and benefits of providing for continuing recruitment of U.S. 
workers after the H-2A workers have already entered the country. Unless 
prior to the expiration of the 5-year period the Department conducts a 
study and publishes a notice determining that the

[[Page 755]]

economic benefits of such extended recruitment period outweigh its 
costs, the recruitment period will, after the expiration of the 5-year 
period, end on the first date the employer requires the services of the 
H-2A worker.
    (ii) Withholding of U.S. workers prohibited. The provisions of this 
paragraph shall apply so as long as the 30-day rule is in place.
    (A) Complaints. Any employer who has reason to believe that a person 
or entity has willfully and knowingly withheld U.S. workers prior to the 
arrival at the job site of H-2A workers in order to force the hiring of 
U.S. workers during the 30-day rule under paragraph (f)(3)(i) of this 
section may submit a written complaint to the CO. The complaint must 
clearly identify the person or entity who the employer believes has 
withheld the U.S. workers, and must specify sufficient facts to support 
the allegation (e.g., dates, places, numbers and names of U.S. workers) 
which will permit an investigation to be conducted by the CO.
    (B) Investigations. The CO must immediately investigate the 
complaint. The investigation must include interviews with the employer 
who has submitted the complaint, the person or entity named as 
responsible for withholding the U.S. workers, and the individual U.S. 
workers whose availability has purportedly been withheld.
    (C) Written findings. Where the CO determines, after conducting the 
interviews required by this paragraph, that the employer's complaint is 
valid and justified, the CO shall immediately suspend the application of 
the 30-day rule under paragraph (f)(3)(i) of this section to the 
employer. The CO's determination shall be the final decision of the 
Secretary.
    (g) Newspaper advertisements. (1) During the period of time that the 
job order is being circulated by the SWA(s) for interstate clearance 
under paragraph (f) of this section, the employer must place an 
advertisement on 2 separate days, which may be consecutive, one of which 
must be a Sunday (except as provided in paragraph (g)(2) of this 
section), in a newspaper of general circulation serving the area of 
intended employment that has a reasonable distribution and is 
appropriate to the occupation and the workers likely to apply for the 
job opportunity. Both newspaper advertisements must be published only 
after the job order is accepted by the SWA for intrastate/interstate 
clearance.
    (2) If the job opportunity is located in a rural area that does not 
have a newspaper with a Sunday edition, the employer must, in place of a 
Sunday edition, advertise in the regularly published daily edition with 
the widest circulation in the area of intended employment.
    (3) The newspaper advertisements must satisfy the requirements of 
Sec.Sec. 655.103 and 655.104. The employer must maintain copies of 
newspaper pages (with date of publication and full copy of ad), or tear 
sheets of the pages of the publication in which the advertisements 
appeared, or other proof of publication containing the text of the 
printed advertisements and the dates of publication furnished by the 
newspaper.
    (4) If a professional, trade or ethnic publication is more 
appropriate for the occupation and the workers likely to apply for the 
job opportunity than a general circulation newspaper, and is the most 
likely source to bring responses from able, willing, qualified, and 
available U.S. workers, the employer may use a professional, trade or 
ethnic publication in place of one of the newspaper advertisements, but 
may not replace the Sunday advertisement (or the substitute required by 
paragraph (g)(2) of this section).
    (h) Contact with former U.S. employees. The employer must contact by 
mail or other effective means its former U.S. employees (except those 
who were dismissed for cause, abandoned the worksite, or were provided 
documentation at the end of their previous period of employment 
explaining the lawful, job-related reasons they would not be re-
contacted) employed by the employer in the occupation at the place of 
employment during the previous year and solicit their return to the job. 
The employer must maintain copies of correspondence signed and dated by 
the employer or, if other means are used, maintain dated logs 
demonstrating

[[Page 756]]

that each worker was contacted, including the phone number, e-mail 
address, or other means that was used to make contact. The employer must 
list in the recruitment report any workers who did not return to the 
employ of the employer because they were either unable or unwilling to 
return to the job or did not respond to the employer's request, and must 
retain documentation, if provided by the worker, showing evidence of 
their inability, unwillingness, or non-responsiveness.
    (i) Additional positive recruitment. (1) Each year, the Secretary 
will make a determination with respect to each State whether there are 
other States (``traditional or expected labor supply States'') in which 
there are a significant number of able and qualified workers who, if 
recruited, would be willing to make themselves available for work in 
that State, as well as which newspapers in each traditional or expected 
labor supply State that the employer may use to fulfill its obligation 
to run a newspaper advertisement in that State. Such determination must 
be based on information provided by State agencies or by other sources 
within the 120 days preceding the determination (which will be solicited 
by notice in the Federal Register), and will to the extent information 
is available take into account the success of recent efforts by out-of-
State employers to recruit in that State. The Secretary will not 
designate a State as a traditional or expected labor supply State if the 
State has a significant number of employers that are recruiting for U.S. 
workers for the same types of occupations and comparable work. The 
Secretary's annual determination as to traditional or expected labor 
supply States, if any, from which applicants from each State must 
recruit will be published in the Federal Register and made available 
through the ETA Web site.
    (2) Each employer must engage in positive recruitment in those 
States designated in accordance with paragraph (i)(1) with respect to 
the State in which the employer's work is to be performed. Such 
recruitment will consist of one newspaper advertisement in each State in 
one of the newspapers designated by the Secretary, published within the 
same period of time as the newspaper advertisements required under 
paragraph (g) of this section. An employer will not be required to 
conduct positive recruitment in more than three States designated in 
accordance with paragraph (i)(1) for each area of intended employment 
listed on the employer's application. The advertisement must refer 
applicants to the SWA nearest the area in which the advertisement was 
placed.
    (j) Referrals of U.S. workers. SWAs may only refer for employment 
individuals for whom they have verified identity and employment 
authorization through the process for employment verification of all 
workers that is established by INA sec. 274A(b). SWAs must provide 
documentation certifying the employment verification that satisfies the 
standards of INA sec. 274A(a)(5) and its implementing regulations at 8 
CFR 274a.6.
    (k) Recruitment report. (1) No more than 50 days before the date of 
need the employer must prepare, sign, and date a written recruitment 
report. The recruitment report must be submitted with the Application 
for Temporary Employment Certification. The recruitment report must:
    (i) List the original number of openings for which the employer 
recruited;
    (ii) Identify each recruitment source by name;
    (iii) State the name and contact information of each U.S. worker who 
applied or was referred to the job opportunity up to the date of the 
preparation of the recruitment report, and the disposition of each 
worker;
    (iv) Confirm that former employees were contacted and by what means; 
and
    (v) If applicable, explain the lawful job-related reason(s) for not 
hiring any U.S. workers who applied for the position.
    (2) The employer must update the recruitment report within 48 hours 
of the date that is the end of the recruitment period as specified in 
Sec.  655.102(f)(3). This supplement to the recruitment report must meet 
the requirements of paragraph (k)(1) of this section. The employer must 
sign and date this supplement to the recruitment report and retain it 
for a period of no less than 3

[[Page 757]]

years. The supplement to the recruitment report must be provided in the 
event of an audit.
    (3) The employer must retain resumes (if provided) of, and evidence 
of contact with (which may be in the form of an attestation), each U.S. 
worker who applied or was referred to the job opportunity. Such resumes 
and evidence of contact must be retained along with the recruitment 
report and the supplemental recruitment report for a period of no less 
than 3 years, and must be provided in response to a Notice of Deficiency 
or in the event of an audit.



Sec.  655.1303  Advertising requirements.

    All advertising conducted to satisfy the required recruitment steps 
underSec. 655.102 before filing the Application for Temporary 
Employment Certification must meet the requirements set forth in this 
section and atSec. 655.104 and must contain terms and conditions of 
employment which are not less favorable than those that will be offered 
to the H-2A workers. All advertising must contain the following 
information:
    (a) The employer's name and location(s) of work, or in the event 
that a master application will be filed by an association, a statement 
indicating that the name and location of each member of the association 
can be obtained from the SWA of the State in which the advertisement is 
run;
    (b) The geographic area(s) of employment with enough specificity to 
apprise applicants of any travel requirements and where applicants will 
likely have to reside to perform the services or labor;
    (c) A description of the job opportunity for which certification is 
sought with sufficient information to apprise U.S. workers of services 
or labor to be performed and the anticipated period of employment of the 
job opportunity;
    (d) The wage offer, or in the event that there are multiple wage 
offers (such as where a master application will be filed by an 
association and/or where there are multiple crop activities for a single 
employer), the range of applicable wage offers and, where a master 
application will be filed by an association, a statement indicating that 
the rate(s) applicable to each employer can be obtained from the SWA;
    (e) The three-fourths guarantee specified inSec. 655.104(i);
    (f) If applicable, a statement that work tools, supplies, and 
equipment will be provided at no cost to the worker;
    (g) A statement that housing will be made available at no cost to 
workers, including U.S. workers, who cannot reasonably return to their 
permanent residence at the end of each working day;
    (h) If applicable, a statement that transportation and subsistence 
expenses to the worksite will be provided by the employer;
    (i) A statement that the position is temporary and a specification 
of the total number of job openings the employer intends to fill;
    (j) A statement directing applicants to report or send resumes to 
the SWA of the State in which the advertisement is run for referral to 
the employer;
    (k) Contact information for the applicable SWA and the job order 
number.



Sec.  655.1304  Contents of job offers.

    (a) Preferential treatment of aliens prohibited. The employer's job 
offer must offer to U.S. workers no less than the same benefits, wages, 
and working conditions that the employer is offering, intends to offer, 
or will provide to H-2A workers. Except where otherwise permitted under 
this section, no job offer may impose on U.S. workers any restrictions 
or obligations that will not be imposed on the employer's H-2A workers.
    (b) Job qualifications. Each job qualification listed in the job 
offer must not substantially deviate from the normal and accepted 
qualifications required by employers that do not use H-2A workers in the 
same or comparable occupations and crops.
    (c) Minimum benefits, wages, and working conditions. Every job offer 
accompanying an H-2A application must include each of the minimum 
benefit, wage, and working condition provisions listed in paragraphs (d) 
through (q) of this section.

[[Page 758]]

    (d) Housing--(1) Obligation to provide housing. The employer must 
provide housing at no cost to the worker, except for those U.S. workers 
who are reasonably able to return to their permanent residence at the 
end of the work day. Housing must be provided through one of the 
following means:
    (i) Employer-provided housing. Employer-provided housing that meets 
the full set of DOL OSHA standards set forth at 29 CFR 1910.142, or the 
full set of standards at Sec.Sec. 654.404 through 654.417 of this 
chapter, whichever are applicable underSec. 654.401; or
    (ii) Rental and/or public accommodations. Rental or public 
accommodations or other substantially similar class of habitation that 
meets applicable local standards for such housing. In the absence of 
applicable local standards, State standards will apply. In the absence 
of applicable local or State standards, DOL OSHA standards at 29 CFR 
1910.142 will apply. Any charges for rental housing must be paid 
directly by the employer to the owner or operator of the housing. The 
employer must document that the housing complies with the local, State, 
or Federal housing standards. Such documentation may include but is not 
limited to a certificate from a State Department of Health or other 
State or local agency or a statement from the manager or owner of the 
housing.
    (2) Standards for range housing. Housing for workers principally 
engaged in the range production of livestock shall meet standards of DOL 
OSHA for such housing. In the absence of such standards, range housing 
for sheepherders and other workers engaged in the range production of 
livestock must meet guidelines issued by ETA.
    (3) Deposit charges. Charges in the form of deposits for bedding or 
other similar incidentals related to housing must not be levied upon 
workers. However, employers may require workers to reimburse them for 
damage caused to housing, bedding, or other property by the individual 
workers found to have been responsible for damage which is not the 
result of normal wear and tear related to habitation.
    (4) Charges for public housing. If public housing provided for 
migrant agricultural workers under the auspices of a local, county, or 
State government is secured by the employer, the employer must pay any 
charges normally required for use of the public housing units (but need 
not pay for optional, extra services) directly to the housing's 
management.
    (5) Family housing. When it is the prevailing practice in the area 
of intended employment and the occupation to provide family housing, 
family housing must be provided to workers with families who request it.
    (6) Housing inspection. In order to ensure that the housing provided 
by an employer under this section meets the relevant standard:
    (i) An employer must make the required attestation, which may 
include an attestation that the employer is complying with the 
procedures set forth inSec. 654.403, at the time of filing the 
Application for Temporary Employment Certification pursuant toSec. 
655.105(e)(2).
    (ii) The employer must make a request to the SWA for a housing 
inspection no less than 60 days before the date of need, except where 
otherwise provided under this part.
    (iii) The SWA must make its determination that the housing meets the 
statutory criteria applicable to the type of housing provided prior to 
the date on which the Secretary is required to make a certification 
determination under INA sec. 218(c)(3)(A), which is 30 days before the 
employer's date of need. SWAs must not adopt rules or restrictions on 
housing inspections that unreasonably prevent inspections from being 
completed in the required time frame, such as rules that no inspections 
will be conducted where the housing is already occupied or is not yet 
leased. If the employer has attested to and met all other criteria for 
certification, and the employer has made a timely request for a housing 
inspection under this paragraph, and the SWA has failed to complete a 
housing inspection by the statutory deadline of 30 days prior to date of 
need, the certification will not be withheld on account of the SWA's 
failure to meet the statutory deadline. The SWA must in such cases 
inspect the housing prior to or during

[[Page 759]]

occupation to ensure it meets applicable housing standards. If, upon 
inspection, the SWA determines the supplied housing does not meet the 
applicable housing standards, the SWA must promptly provide written 
notification to the employer and the CO. The CO will take appropriate 
action, including notice to the employer to cure deficiencies. An 
employer's failure to cure substantial violations can result in 
revocation of the temporary labor certification.
    (7) Certified housing that becomes unavailable. If after a request 
to certify housing (but before certification), or after certification of 
housing, such housing becomes unavailable for reasons outside the 
employer's control, the employer may substitute other rental or public 
accommodation housing that is in compliance with the local, State, or 
Federal housing standards applicable under paragraph (d)(1)(ii) of this 
section and for which the employer is able to submit evidence of such 
compliance. The employer must notify the SWA in writing of the change in 
accommodations and the reason(s) for such change and provide the SWA 
evidence of compliance with the applicable local, State or Federal 
safety and health standards, in accordance with the requirements of 
paragraph (d)(1)(ii) of this section. The SWA must notify the CO of all 
housing changes and of any noncompliance with the standards set forth in 
paragraph (d)(1)(ii) of this section. Substantial noncompliance can 
result in revocation of the temporary labor certification underSec. 
655.117.
    (e) Workers' compensation. The employer must provide workers' 
compensation insurance coverage in compliance with State law covering 
injury and disease arising out of and in the course of the worker's 
employment. If the type of employment for which the certification is 
sought is not covered by or is exempt from the State's workers' 
compensation law, the employer must provide, at no cost to the worker, 
insurance covering injury and disease arising out of and in the course 
of the worker's employment that will provide benefits at least equal to 
those provided under the State workers' compensation law for other 
comparable employment. The employer must retain for 3 years from the 
date of certification of the application, the name of the insurance 
carrier, the insurance policy number, and proof of insurance for the 
dates of need, or, if appropriate, proof of State law coverage.
    (f) Employer-provided items. Except as provided in this paragraph, 
the employer must provide to the worker, without charge or deposit 
charge, all tools, supplies, and equipment required to perform the 
duties assigned. The employer may charge the worker for reasonable costs 
related to the worker's refusal or negligent failure to return any 
property furnished by the employer or due to such worker's willful 
damage or destruction of such property. Where it is a common practice in 
the particular area, crop activity and occupation for workers to provide 
tools and equipment, with or without the employer reimbursing the 
workers for the cost of providing them, such an arrangement will be 
permitted, provided that the requirements of sec. 3(m) of the FLSA at 29 
U.S.C. 203(m) are met. Section 3(m) does not permit deductions for tools 
or equipment primarily for the benefit of the employer that reduce an 
employee's wage below the wage required under the minimum wage, or, 
where applicable, the overtime provisions of the FLSA.
    (g) Meals. The employer either must provide each worker with three 
meals a day or must furnish free and convenient cooking and kitchen 
facilities to the workers that will enable the workers to prepare their 
own meals. Where the employer provides the meals, the job offer must 
state the charge, if any, to the worker for such meals. The amount of 
meal charges is governed bySec. 655.114.
    (h) Transportation; daily subsistence--(1) Transportation to place 
of employment. If the employer has not previously advanced such 
transportation and subsistence costs to the worker or otherwise provided 
such transportation or subsistence directly to the worker by other means 
and if the worker completes 50 percent of the work contract period, the 
employer must pay the worker for reasonable costs incurred by the worker 
for transportation and daily subsistence from the place from

[[Page 760]]

which the worker has departed to the employer's place of employment. For 
an H-2A worker coming from outside of the U.S., the place from which the 
worker has departed is the place of recruitment, which the Department 
interprets to mean the appropriate U.S. consulate or port of entry. When 
it is the prevailing practice of non-H-2A agricultural employers in the 
occupation in the area to do so, or when the employer extends such 
benefits to similarly situated H-2A workers, the employer must advance 
the required transportation and subsistence costs (or otherwise provide 
them) to U.S. workers. The amount of the transportation payment must be 
no less (and is not required to be more) than the most economical and 
reasonable common carrier transportation charges for the distances 
involved. The amount of the daily subsistence payment must be at least 
as much as the employer would charge the worker for providing the worker 
with three meals a day during employment (if applicable), but in no 
event less than the amount permitted under paragraph (g) of this 
section.
    (2) Transportation from last place of employment to home country. If 
the worker completes the work contract period, and the worker has no 
immediately subsequent H-2A employment, the employer must provide or pay 
for the worker's transportation and daily subsistence from the place of 
employment to the place from which the worker, disregarding intervening 
employment, departed to work for the employer. For an H-2A worker coming 
from outside of the U.S., the place from which the worker has departed 
will be considered to be the appropriate U.S. consulate or port of 
entry.
    (3) Transportation between living quarters and worksite. The 
employer must provide transportation between the worker's living 
quarters (i.e., housing provided or secured by the employer pursuant to 
paragraph (d) of this section) and the employer's worksite at no cost to 
the worker, and such transportation must comply with all applicable 
Federal, State or local laws and regulations, and must provide, at a 
minimum, the same vehicle safety standards, driver licensure, and 
vehicle insurance as required under 29 U.S.C. 1841 and 29 CFR part 500, 
subpart D. If workers' compensation is used to cover such 
transportation, in lieu of vehicle insurance, the employer must either 
ensure that the workers' compensation covers all travel or that vehicle 
insurance exists to provide coverage for travel not covered by workers' 
compensation.
    (i) Three-fourths guarantee--(1) Offer to worker. The employer must 
guarantee to offer the worker employment for a total number of work 
hours equal to at least three-fourths of the workdays of the total 
period beginning with the first workday after the arrival of the worker 
at the place of employment or the advertised contractual first date of 
need, whichever is later, and ending on the expiration date specified in 
the work contract or in its extensions, if any. For purposes of this 
paragraph a workday means the number of hours in a workday as stated in 
the job order and excludes the worker's Sabbath and Federal holidays. 
The employer must offer a total number of hours to ensure the provision 
of sufficient work to reach the three-fourths guarantee. The work hours 
must be offered during the work period specified in the work contract, 
or during any modified work contract period to which the worker and 
employer have mutually agreed and has been approved by the CO. The work 
contract period can be shortened by agreement of the parties only with 
the approval of the CO. In the event the worker begins working later 
than the specified beginning date of the contract, the guarantee period 
begins with the first workday after the arrival of the worker at the 
place of employment, and continues until the last day during which the 
work contract and all extensions thereof are in effect. Therefore, if, 
for example, a work contract is for a 10-week period, during which a 
normal workweek is specified as 6 days a week, 8 hours per day, the 
worker would have to be guaranteed employment for at least 360 hours 
(e.g., 10 weeks x 48 hours/week = 480-hours x 75 percent = 360). If a 
Federal holiday occurred during the 10-week span, the 8 hours would be 
deducted from the total guaranteed. A worker may be offered more than 
the specified hours of work on a single workday. For purposes of

[[Page 761]]

meeting the guarantee, however, the worker will not be required to work 
for more than the number of hours specified in the job order for a 
workday, or on the worker's Sabbath or Federal holidays. However, all 
hours of work actually performed may be counted by the employer in 
calculating whether the period of guaranteed employment has been met. If 
the employer affords the U.S. or H-2A worker during the total work 
contract period less employment than that required under this paragraph, 
the employer must pay such worker the amount the worker would have 
earned had the worker, in fact, worked for the guaranteed number of 
days.
    (2) Guarantee for piece rate paid worker. If the worker will be paid 
on a piece rate basis, the employer must use the worker's average hourly 
piece rate earnings or the AEWR, whichever is higher, to calculate the 
amount due under the guarantee.
    (3) Failure to work. Any hours the worker fails to work, up to a 
maximum of the number of hours specified in the job order for a workday, 
when the worker has been offered an opportunity to do so in accordance 
with paragraph (i)(1) of this section, and all hours of work actually 
performed (including voluntary work over 8 hours in a workday or on the 
worker's Sabbath or Federal holidays), may be counted by the employer in 
calculating whether the period of guaranteed employment has been met. An 
employer seeking to calculate whether the number of hours has been met 
must maintain the payroll records in accordance with paragraph (j)(2) of 
this section.
    (4) Displaced H-2A worker. The employer is not liable for payment 
under paragraph (i)(1) of this section to an H-2A worker whom the CO 
certifies is displaced because of the employer's compliance withSec. 
655.105(d) with respect to referrals made after the employer's date of 
need. The employer is, however, liable for return transportation for any 
such displaced worker in accordance with paragraph (h)(2) of this 
section.
    (5) Obligation to provide housing and meals. Notwithstanding the 
three-fourths guarantee contained in this section, employers are 
obligated to provide housing and subsistence for each day of the 
contract period up until the day the workers depart for other H-2A 
employment, depart to the place outside of the U.S. from which the 
worker came, or, if the worker voluntarily abandons employment or is 
terminated for cause, the day of such abandonment or termination.
    (j) Earnings records. (1) The employer must keep accurate and 
adequate records with respect to the workers' earnings, including but 
not limited to field tally records, supporting summary payroll records, 
and records showing the nature and amount of the work performed; the 
number of hours of work offered each day by the employer (broken out by 
hours offered both in accordance with and over and above the three-
fourths guarantee at paragraph (i)(3) of this section); the hours 
actually worked each day by the worker; the time the worker began and 
ended each workday; the rate of pay (both piece rate and hourly, if 
applicable); the worker's earnings per pay period; the worker's home 
address; and the amount of and reasons for any and all deductions taken 
from the worker's wages.
    (2) Each employer must keep the records required by this part, 
including field tally records and supporting summary payroll records, 
safe and accessible at the place or places of employment, or at one or 
more established central recordkeeping offices where such records are 
customarily maintained. All records must be available for inspection and 
transcription by the Secretary or a duly authorized and designated 
representative, and by the worker and representatives designated by the 
worker as evidenced by appropriate documentation (an Entry of Appearance 
as Attorney or Representative, Form G-28, signed by the worker, or an 
affidavit signed by the worker confirming such representation). Where 
the records are maintained at a central recordkeeping office, other than 
in the place or places of employment, such records must be made 
available for inspection and copying within 72 hours following notice 
from the Secretary, or a duly authorized and designated representative, 
and by the worker and designated representatives as described in this 
paragraph.

[[Page 762]]

    (3) To assist in determining whether the three-fourths guarantee in 
paragraph (i) of this section has been met, if the number of hours 
worked by the worker on a day during the work contract period is less 
than the number of hours offered, as specified in the job offer, the 
records must state the reason or reasons therefore.
    (4) The employer must retain the records for not less than 3 years 
after the completion of the work contract.
    (k) Hours and earnings statements. The employer must furnish to the 
worker on or before each payday in one or more written statements the 
following information:
    (1) The worker's total earnings for the pay period;
    (2) The worker's hourly rate and/or piece rate of pay;
    (3) The hours of employment offered to the worker (broken out by 
offers in accordance with, and over and above, the guarantee);
    (4) The hours actually worked by the worker;
    (5) An itemization of all deductions made from the worker's wages; 
and
    (6) If piece rates are used, the units produced daily.
    (l) Rates of pay. (1) If the worker is paid by the hour, the 
employer must pay the worker at least the AEWR in effect at the time 
recruitment for the position was begun, the prevailing hourly wage rate, 
the prevailing piece rate, or the Federal or State minimum wage rate, 
whichever is highest, for every hour or portion thereof worked during a 
pay period; or
    (2)(i) If the worker is paid on a piece rate basis and the piece 
rate does not result at the end of the pay period in average hourly 
piece rate earnings during the pay period at least equal to the amount 
the worker would have earned had the worker been paid at the appropriate 
hourly rate, the worker's pay must be supplemented at that time so that 
the worker's earnings are at least as much as the worker would have 
earned during the pay period if the worker had instead been paid at the 
appropriate hourly wage rate for each hour worked;
    (ii) The piece rate must be no less than the piece rate prevailing 
for the activity in the area of intended employment; and
    (iii) If the employer who pays by the piece rate requires one or 
more minimum productivity standards of workers as a condition of job 
retention, such standards must be specified in the job offer and must be 
normal, meaning that they may not be unusual for workers performing the 
same activity in the area of intended employment.
    (m) Frequency of pay. The employer must state in the job offer the 
frequency with which the worker will be paid, which must be at least 
twice monthly.
    (n) Abandonment of employment or termination for cause. If the 
worker voluntarily abandons employment before the end of the contract 
period, fails to report for employment at the beginning of the contract 
period, or is terminated for cause, and the employer notifies the 
Department and DHS in writing or by any other method specified by the 
Department or DHS in a manner specified in a notice published in the 
Federal Register not later than 2 working days after such abandonment or 
abscondment occurs, the employer will not be responsible for providing 
or paying for the subsequent transportation and subsistence expenses of 
that worker under paragraph (h) of this section, and that worker is not 
entitled to the three-fourths guarantee described in paragraph (i) of 
this section. An abandonment or abscondment shall be deemed to begin 
after a worker fails to report for work at the regularly scheduled time 
for 5 consecutive working days without the consent of the employer. 
Employees may be terminated for cause, however, for shorter unexcused 
periods of time that shall not be considered abandonment or abscondment.
    (o) Contract impossibility. If, before the expiration date specified 
in the work contract, the services of the worker are no longer required 
for reasons beyond the control of the employer due to fire, weather, or 
other Act of God that makes the fulfillment of the contract impossible, 
the employer may terminate the work contract. Whether such an event 
constitutes a contract impossibility will be determined by the CO. In 
the event of such termination of a

[[Page 763]]

contract, the employer must fulfill a three-fourths guarantee for the 
time that has elapsed from the start of the work contract to the time of 
its termination as described in paragraph (i)(1) of this section. The 
employer must:
    (1) Return the worker, at the employer's expense, to the place from 
which the worker (disregarding intervening employment) came to work for 
the employer, or transport the worker to the worker's next certified H-
2A employer (but only if the worker can provide documentation supporting 
such employment), whichever the worker prefers. For an H-2A worker 
coming from outside of the U.S., the place from which the worker 
(disregarding intervening employment) came to work for the employer is 
the appropriate U.S. consulate or port of entry;
    (2) Reimburse the worker the full amount of any deductions made from 
the worker's pay by the employer for transportation and subsistence 
expenses to the place of employment; and
    (3) Pay the worker for any costs incurred by the worker for 
transportation and daily subsistence to that employer's place of 
employment. Daily subsistence will be computed as set forth in paragraph 
(h) of this section. The amount of the transportation payment will be no 
less (and is not required to be more) than the most economical and 
reasonable common carrier transportation charges for the distances 
involved.
    (p) Deductions. The employer must make all deductions from the 
worker's paycheck that are required by law. The job offer must specify 
all deductions not required by law which the employer will make from the 
worker's paycheck. All deductions must be reasonable. However, an 
employer subject to the FLSA may not make deductions that would violate 
the FLSA.
    (q) Copy of work contract. The employer must provide to the worker, 
no later than on the day the work commences, a copy of the work contract 
between the employer and the worker. The work contract must contain all 
of the provisions required by paragraphs (a) through (p) of this 
section. In the absence of a separate, written work contract entered 
into between the employer and the worker, the job order, as provided in 
20 CFR part 653, Subpart F, will be the work contract.



Sec.  655.1305  Assurances and obligations of H-2A employers.

    An employer seeking to employ H-2A workers must attest as part of 
the Application for Temporary Employment Certification that it will 
abide by the following conditions of this subpart:
    (a) The job opportunity is and will continue through the recruitment 
period to be open to any qualified U.S. worker regardless of race, 
color, national origin, age, sex, religion, handicap, or citizenship, 
and the employer has conducted and will continue to conduct the required 
recruitment, in accordance with regulations, and has been unsuccessful 
in locating sufficient numbers of qualified U.S. applicants for the job 
opportunity for which certification is sought. Any U.S. workers who 
applied or apply for the job were or will be rejected only for lawful, 
job-related reasons, and those not rejected on this basis have been or 
will be hired. In addition, the employer attests that it will retain 
records of all rejections as required bySec. 655.119.
    (b) The employer is offering terms and working conditions which are 
not less favorable than those offered to the H-2A worker(s) and are not 
less than the minimum terms and conditions required by this subpart.
    (c) The specific job opportunity for which the employer is 
requesting H-2A certification is not vacant because the former occupant 
is on strike or being locked out in the course of a labor dispute.
    (d) The employer will continue to cooperate with the SWA by 
accepting referrals of all eligible U.S. workers who apply (or on whose 
behalf an application is made) for the job opportunity until the end of 
the recruitment period as specified inSec. 655.102(f)(3).
    (e) During the period of employment that is the subject of the labor 
certification application, the employer will:
    (1) Comply with applicable Federal, State and local employment-
related laws and regulations, including employment-related health and 
safety laws;
    (2) Provide for or secure housing for those workers who are not 
reasonably

[[Page 764]]

able to return to their permanent residence at the end of the work day, 
without charge to the worker, that complies with the applicable 
standards as set forth inSec. 655.104(d);
    (3) Where required, has timely requested a preoccupancy inspection 
of the housing and, if one has been conducted, received certification;
    (4) Provide insurance, without charge to the worker, under a State 
workers' compensation law or otherwise, that meets the requirements of 
Sec.  655.104(e); and
    (5) Provide transportation in compliance with all applicable 
Federal, State or local laws and regulations between the worker's living 
quarters (i.e., housing provided by the employer underSec. 655.104(d)) 
and the employer's worksite without cost to the worker.
    (f) Upon the separation from employment of H-2A worker(s) employed 
under the labor certification application, if such separation occurs 
prior to the end date of the employment specified in the application, 
the employer will notify the Department and DHS in writing (or any other 
method specified by the Department or DHS) of the separation from 
employment not later than 2 work days after such separation is 
discovered by the employer. The procedures for reporting abandonments 
and abscondments are outlined inSec. 655.104(n) of this subpart.
    (g) The offered wage rate is the highest of the AEWR in effect at 
the time recruitment is initiated, the prevailing hourly wage or piece 
rate, or the Federal or State minimum wage, and the employer will pay 
the offered wage during the entire period of the approved labor 
certification.
    (h) The offered wage is not based on commission, bonuses, or other 
incentives, unless the employer guarantees a wage paid on a weekly, bi-
weekly, or monthly basis that equals or exceeds the AEWR, prevailing 
hourly wage or piece rate, or the legal Federal or State minimum wage, 
whichever is highest.
    (i) The job opportunity is a full-time temporary position, 
calculated to be at least 30 hours per work week, the qualifications for 
which do not substantially deviate from the normal and accepted 
qualifications required by employers that do not use H-2A workers in the 
same or comparable occupations or crops.
    (j) The employer has not laid off and will not lay off any similarly 
employed U.S. worker in the occupation that is the subject of the 
Application for Temporary Employment Certification in the area of 
intended employment except for lawful, job related reasons within 60 
days of the date of need, or if the employer has laid off such workers, 
it has offered the job opportunity that is the subject of the 
application to those laid-off U.S. worker(s) and the U.S. worker(s) 
either refused the job opportunity or was rejected for the job 
opportunity for lawful, job-related reasons.
    (k) The employer has not and will not intimidate, threaten, 
restrain, coerce, blacklist, or in any manner discriminate against, and 
has not and will not cause any person to intimidate, threaten, restrain, 
coerce, blacklist, or in any manner discriminate against, any person who 
has with just cause:
    (1) Filed a complaint under or related to sec. 218 of the INA at 8 
U.S.C. 1188, or this subpart or any other Department regulation 
promulgated under sec. 218 of the INA;
    (2) Instituted or caused to be instituted any proceeding under or 
related to sec. 218 of the INA, or this subpart or any other Department 
regulation promulgated under sec. 218 of the INA;
    (3) Testified or is about to testify in any proceeding under or 
related to sec. 218 of the INA or this subpart or any other Department 
regulation promulgated under sec. 218 of the INA;
    (4) Consulted with an employee of a legal assistance program or an 
attorney on matters related to sec. 218 of the INA or this subpart or 
any other Department regulation promulgated under sec. 218 of the INA; 
or
    (5) Exercised or asserted on behalf of himself/herself or others any 
right or protection afforded by sec. 218 of the INA, or this subpart or 
any other Department regulation promulgated under sec. 218 of the INA.
    (l) The employer shall not discharge any person because of that 
person's taking any action listed in paragraphs (k)(1) through (k)(5) of 
this section.

[[Page 765]]

    (m) All fees associated with processing the temporary labor 
certification will be paid in a timely manner.
    (n) The employer will inform H-2A workers of the requirement that 
they leave the U.S. at the end of the period certified by the Department 
or separation from the employer, whichever is earlier, as required under 
Sec.  655.111, unless the H-2A worker is being sponsored by another 
subsequent employer.
    (o) The employer and its agents have not sought or received payment 
of any kind from the employee for any activity related to obtaining 
labor certification, including payment of the employer's attorneys' 
fees, application fees, or recruitment costs. For purposes of this 
paragraph, payment includes, but is not limited to, monetary payments, 
wage concessions (including deductions from wages, salary, or benefits), 
kickbacks, bribes, tributes, in kind payments, and free labor. This 
provision does not prohibit employers or their agents from receiving 
reimbursement for costs that are the responsibility of the worker, such 
as government required passport or visa fees.
    (p) The employer has contractually forbidden any foreign labor 
contractor or recruiter whom the employer engages in international 
recruitment of H-2A workers to seek or receive payments from prospective 
employees, except as provided for in DHS regulations at 8 CFR 
214.2(h)(5)(xi)(A).
    (q) The applicant is either a fixed-site employer, an agent or 
recruiter, an H-2ALC (as defined in these regulations), or an 
association.



Sec.  655.1306  Assurances and obligations of H-2A Labor Contractors.

    (a) The pre-filing activity requirements set forth inSec. 655.102 
are modified as follows for H-2ALCs:
    (1) The job order for an H-2ALC may contain work locations in 
multiple areas of intended employment, and may be submitted to any one 
of the SWAs having jurisdiction over the anticipated work areas. The SWA 
receiving the job order shall promptly transmit, on behalf of the 
employer, a copy of its active job order to all States listed in the 
application as anticipated worksites, as well as those States, if any, 
designated by the Secretary as traditional or expected labor supply 
States for each area in which the employer's work is to be performed. 
Each SWA shall keep the H-2ALC's job order posted until the end of the 
recruitment period, as set forth inSec. 655.102(f)(3), for the area of 
intended employment that is covered by the SWA. SWAs in States that have 
been designated as traditional or expected labor supply States for more 
than one area of intended of employment that are listed on an 
application shall keep the H-2ALC's job order posted until the end of 
the applicable recruitment period that is last in time, and may make 
referrals for job opportunities in any area of intended employment that 
is still in an active recruitment period, as defined bySec. 
655.102(f)(3).
    (2) The H-2ALC must conduct separate positive recruitment under 
Sec.  655.102(g) through (i) for each area of intended employment in 
which the H-2ALC intends to perform work, but need not conduct separate 
recruitment for each work location within a single area of intended 
employment. The positive recruitment for each area of intended 
employment must list the name and location of each fixed-site 
agricultural business to which the H-2ALC expects to provide H-2A 
workers, the expected beginning and ending dates when the H-2ALC will be 
providing the workers to each fixed site, and a description of the crops 
and activities the workers are expected to perform at such fixed site. 
Such positive recruitment must be conducted pre-filing for the first 
area of intended employment, but must be started no more than 75 and no 
fewer than 60 days before the listed arrival date (or the amended date, 
if applicable) for each subsequent area of intended employment. For each 
area of intended employment, the advertising that must be placed in any 
applicable States designated as traditional or expected labor supply 
States must be placed at the same time as the placement of other 
positive recruitment for the area of intended employment in accordance 
withSec. 655.102(i)(2).
    (3) The job order and the positive recruitment in each area of 
intended employment may require that workers

[[Page 766]]

complete the remainder of the H-2ALC's itinerary.
    (4) An H-2ALC who hires U.S. workers during the course of its 
itinerary, and accordingly releases one or more of its H-2A workers, is 
eligible for the release from the three-quarters guarantee with respect 
to the released H-2A workers that is provided for inSec. 
655.104(i)(4).
    (5) An H-2ALC may amend its application subsequent to submission in 
accordance withSec. 655.107(d)(3) to account for new or changed 
worksites or areas of intended employment during the course of the 
itinerary in the following manner:
    (i) If the additional worksite(s) are in the same area(s) of 
intended employment as represented on the Application for Temporary 
Employment Certification, the H-2ALC is not required to re-recruit in 
those areas of intended employment if that recruitment has been 
completed and if the job duties at the new work sites are similar to 
those already covered by the application.
    (ii) If the additional worksite(s) are outside the area(s) of 
intended employment represented on the Application for Temporary 
Employment Certification, the H-2ALC must submit in writing the new 
area(s) of intended employment and explain the reasons for the amendment 
of the labor certification itinerary. The CO will order additional 
recruitment in accordance withSec. 655.102(d).
    (iii) For any additional worksite not included on the original 
application that necessitates a change in housing of H-2A workers, the 
H-2ALC must secure the statement of housing as described in paragraph 
(b)(6) of this section and obtain an inspection of such housing from the 
SWA in the area of intended employment.
    (iv) Where additional recruitment is required under paragraphs 
(a)(5)(i) or (a)(5)(ii) of this section, the CO shall allow it to take 
place on an expedited basis, where possible, so as to allow the amended 
dates of need to be met.
    (6) Consistent with paragraph (a)(5) of this section, no later than 
30 days prior to the commencement of employment in each area of intended 
employment in the itinerary of an H-2ALC, the SWA having jurisdiction 
over that area of intended employment must complete the housing 
inspections for any employer-provided housing to be used by the 
employees of the H-2ALC.
    (7) To satisfy the requirements ofSec. 655.102(h), the H-2ALC must 
contact all U.S employees that worked for the H-2ALC during the previous 
season, except those excluded by that section, before filing its 
application, and must advise those workers that a separate job 
opportunity exists for each area of intended employment that is covered 
by the application. The employer may advise contacted employees that for 
any given job opportunity, workers may be required to complete the 
remainder of the H-2ALC's itinerary.
    (b) In addition to the assurances and obligations listed inSec. 
655.105, H-2ALC applicants are also required to:
    (1) Provide the MSPA Farm Labor Contractor (FLC) certificate of 
registration number and expiration date if required under MSPA at 29 
U.S.C. 1801 et seq., to have such a certificate;
    (2) Identify the farm labor contracting activities the H-2ALC is 
authorized to perform as an FLC under MSPA as shown on the FLC 
certificate of registration, if required under MSPA at 29 U.S.C. 1801 et 
seq., to have such a certificate of registration;
    (3) List the name and location of each fixed-site agricultural 
business to which the H-2A Labor Contractor expects to provide H-2A 
workers, the expected beginning and ending dates when the H-2ALC will be 
providing the workers to each fixed site, and a description of the crops 
and activities the workers are expected to perform at such fixed site;
    (4) Provide proof of its ability to discharge financial obligations 
under the H-2A program by attesting that it has obtained a surety bond 
as required by 29 CFR 501.8, stating on the application the name, 
address, phone number, and contact person for the surety, and providing 
the amount of the bond (as calculated pursuant to 29 CFR 501.8) and any 
identifying designation utilized by the surety for the bond;
    (5) Attest that it has engaged in, or will engage in within the 
timeframes required bySec. 655.102 as modified bySec. 655.106(a), 
recruitment efforts in each area of intended employment in which

[[Page 767]]

it has listed a fixed-site agricultural business; and
    (6) Attest that it will be providing housing and transportation that 
complies with the applicable housing standards inSec. 655.104(d) or 
that it has obtained from each fixed-site agricultural business that 
will provide housing or transportation to the workers a written 
statement stating that:
    (i) All housing used by workers and owned, operated or secured by 
the fixed-site agricultural business complies with the applicable 
housing standards inSec. 655.104(d); and
    (ii) All transportation between the worksite and the workers' living 
quarters that is provided by the fixed-site agricultural business 
complies with all applicable Federal, State, or local laws and 
regulations and will provide, at a minimum, the same vehicle safety 
standards, driver licensure, and vehicle insurance as required under 29 
U.S.C. 1841 and 29 CFR part 500, subpart D, except where workers' 
compensation is used to cover such transportation as described inSec. 
655.104(h)(3).



Sec.  655.1307  Processing of applications.

    (a) Processing. (1) Upon receipt of the application, the CO will 
promptly review the application for completeness and an absence of 
errors that would prevent certification, and for compliance with the 
criteria for certification. The CO will make a determination to certify, 
deny, or issue a Notice of Deficiency prior to making a Final 
Determination on the application. Applications requesting that zero job 
opportunities be certified for H-2A employment because the employer has 
been able to recruit a sufficient number of U.S. workers must comply 
with other requirements for H-2A applications and must be supported by a 
recruitment report, in which case the application will be accepted but 
will then be denied. Criteria for certification, as used in this 
subpart, include, but are not limited to, whether the employer has 
established the need for the agricultural services or labor to be 
performed on a temporary or seasonal basis; made all the assurances and 
met all the obligations required bySec. 655.105, and/or, if an H-2ALC, 
bySec. 655.106; complied with the timeliness requirements inSec. 
655.102; and complied with the recruitment obligations required by 
Sec.Sec. 655.102 and 655.103.
    (2) Unless otherwise noted, any notice or request sent by the CO or 
OFLC to an applicant requiring a response shall be sent by means 
normally assuring next-day delivery, to afford the applicant sufficient 
time to respond. The employer's response shall be considered filed with 
the Department when sent (by mail, certified mail, or any other means 
indicated to be acceptable by the CO) to the Department, which may be 
demonstrated, for example, by a postmark.
    (b) Notice of deficiencies. (1) If the CO determines that the 
employer has made all necessary attestations and assurances, but the 
application fails to comply with one or more of the criteria for 
certification in paragraph (a) of this section, the CO will promptly 
notify the employer within 7 calendar days of the CO's receipt of the 
application.
    (2) The notice will:
    (i) State the reason(s) why the application fails to meet the 
criteria for temporary labor certification, citing the relevant 
regulatory standard(s);
    (ii) Offer the employer an opportunity to submit a modified 
application within 5 business days from date of receipt, stating the 
modification that is needed for the CO to accept the application for 
consideration;
    (iii) Except as provided for under paragraph (b)(2)(iv) of this 
section, state that the CO's determination on whether to grant or deny 
the Application for Temporary Employment Certification will be made no 
later than 30 calendar days before the date of need, provided that the 
employer submits the requested modification to the application within 5 
business days and in a manner specified by the CO;
    (iv) Where the CO determines the employer failed to comply with the 
recruitment obligations required by Sec.Sec. 655.102 and 655.103, 
offer the employer an opportunity to correct its recruitment and conduct 
it on an expedited schedule. The CO shall specify the positive 
recruitment requirements, request the employer submit proof of corrected 
advertisement and an initial recruitment report meeting the requirements

[[Page 768]]

ofSec. 655.102(k) no earlier than 48 hours after the last corrected 
advertisement is printed, and state that the CO's determination on 
whether to grant or deny the Application for Temporary Employment 
Certification will be made within 5 business days of receiving the 
required documentation, which may be a date later than 30 days before 
the date of need:
    (v) Offer the employer an opportunity to request an expedited 
administrative review or a de novo administrative hearing before an ALJ, 
of the Notice of Deficiency. The notice will state that in order to 
obtain such a review or hearing, the employer, within 5 business days of 
the receipt of the notice, must file by facsimile or other means 
normally assuring next day delivery, a written request to the Chief 
Administrative Law Judge of DOL and simultaneously serve a copy on the 
CO. The notice will also state that the employer may submit any legal 
arguments that the employer believes will rebut the basis of the CO's 
action; and
    (vi) State that if the employer does not comply with the 
requirements under paragraphs (b)(2)(ii) and (iv) of this section or 
request an expedited administrative judicial review or a de novo hearing 
before an ALJ within the 5 business days the CO will deny the 
application in accordance with the labor certification determination 
provisions inSec. 655.109.
    (c) Submission of modified applications. (1) If the CO notifies the 
employer of any deficiencies within the 7 calendar day timeframe set 
forth in paragraph (b)(1) of this section, the date by which the CO's 
Final Determination is required by statute to be made will be postponed 
by 1 day for each day that passes beyond the 5 business-day period 
allowed under paragraph (b)(2)(ii) of this section to submit a modified 
application.
    (2) Where the employer submits a modified application as required by 
the CO, and the CO approves the modified application, the CO will not 
deny the application based solely on the fact that it now does not meet 
the timeliness requirements for filing applications.
    (3) If the modified application is not approved, the CO will deny 
the application in accordance with the labor certification determination 
provisions inSec. 655.109.
    (d) Amendments to applications. (1) Applications may be amended at 
any time before the CO's certification determination to increase the 
number of workers requested in the initial application by not more than 
20 percent (50 percent for employers requesting less than 10 workers) 
without requiring an additional recruitment period for U.S. workers. 
Requests for increases above the percent prescribed, without additional 
recruitment, may be approved by the CO only when the request is 
submitted in writing, the need for additional workers could not have 
been foreseen, and the crops or commodities will be in jeopardy prior to 
the expiration of an additional recruitment period.
    (2) Applications may be amended to make minor changes in the total 
period of employment, but only if a written request is submitted to the 
CO and approved in advance. In considering whether to approve the 
request, the CO will review the reason(s) for the request, determine 
whether the reason(s) are on the whole justified, and take into account 
the effect(s) of a decision to approve on the adequacy of the underlying 
test of the domestic labor market for the job opportunity. If a request 
for a change in the start date of the total period of employment is made 
after workers have departed for the employer's place of work, the CO may 
only approve the change if the request is accompanied by a written 
assurance signed and dated by the employer that all such workers will be 
provided housing and subsistence, without cost to the workers, until 
work commences. Upon acceptance of an amendment, the CO will submit to 
the SWA any necessary modification to the job order.
    (3) Other amendments to the application, including elements of the 
job offer and the place of work, may be approved by the CO if the CO 
determines the proposed amendment(s) are justified by a business reason 
and will not prevent the CO from making the labor certification 
determination required underSec. 655.109. Requested amendments will be 
reviewed as quickly as possible, taking into account revised dates of

[[Page 769]]

need for work locations associated with the amendment.
    (e) Appeal procedures. With respect to either a Notice of Deficiency 
issued under paragraph (b) of this section, the denial of a requested 
amendment under paragraph (d) of this section, or a notice of denial 
issued underSec. 655.109(e), if the employer timely requests an 
expedited administrative review or de novo hearing before an ALJ, the 
procedures set forth inSec. 655.115 will be followed.



Sec.  655.1308  Offered wage rate.

    (a) Highest wage. To comply with its obligation underSec. 
655.105(g), an employer must offer a wage rate that is the highest of 
the AEWR in effect at the time recruitment for a position is begun, the 
prevailing hourly wage or piece rate, or the Federal or State minimum 
wage.
    (b) Wage rate request. The employer must request and obtain a wage 
rate determination from the NPC, on a form prescribed by ETA, before 
commencing any recruitment under this subpart, except where specifically 
exempted from this requirement by these regulations.
    (c) Validity of wage rate. The recruitment must begin within the 
validity period of the wage determination obtained from the NPC. 
Recruitment for this purpose begins when the job order is accepted by 
the SWA for posting.
    (d) Wage offer. The employer must offer and advertise in its 
recruitment a wage at least equal to the wage rate required by paragraph 
(a) of this section.
    (e) Adverse effect wage rate. The AEWR will be based on published 
wage data for the occupation, skill level, and geographical area from 
the Bureau of Labor Statistics (BLS), Occupational Employment Statistics 
(OES) survey. The NPC will obtain wage information on the AEWR using the 
On-line Wage Library (OWL) found on the Foreign Labor Certification Data 
Center Web site (http://www.flcdatacenter.com/). This wage shall not be 
less than the July 24, 2009 Federal minimum wage of $7.25.
    (f) Wage determination. The NPC must enter the wage rate 
determination on a form it uses, indicate the source, and return the 
form with its endorsement to the employer.
    (g) Skill level. (1) Level I wage rates are assigned to job offers 
for beginning level employees who have a basic understanding of the 
occupation. These employees perform routine tasks that require limited, 
if any, exercise of judgment. The tasks provide experience and 
familiarization with the employer's methods, practices, and programs. 
The employees may perform higher level work for training and 
developmental purposes. These employees work under close supervision and 
receive specific instructions on required tasks and results expected. 
Their work is closely monitored and reviewed for accuracy.
    (2) Level II wage rates are assigned to job offers for employees who 
have attained, through education or experience, a good understanding of 
the occupation. These employees perform moderately complex tasks that 
require limited judgment. An indicator that the job request warrants a 
wage determination at Level II would be a requirement for years of 
education and/or experience that are generally required as described in 
the O*NET Job Zones.
    (3) Level III wage rates are assigned to job offers for employees 
who have a sound understanding of the occupation and have attained, 
either through education or experience, special skills or knowledge. 
These employees perform tasks that require exercising judgment and may 
coordinate the activities of other staff. They may have supervisory 
authority over those staff. A requirement for years of experience or 
educational degrees that are at the higher ranges indicated in the O*NET 
Job Zones would be an indicator that a Level III wage should be 
considered. Frequently, key words in the job title can be used as 
indicators that an employer's job offer is for an experienced worker. 
Words such as lead, senior, crew chief, or journeyman would be 
indicators that a Level III wage should be considered.
    (4) Level IV wage rates are assigned to job offers for employees who 
have sufficient experience in the occupation to plan and conduct work 
requiring judgment and the independent evaluation, selection, 
modification, and application of standard procedures and techniques. 
Such employees receive only

[[Page 770]]

minimal guidance and their work is reviewed only for application of 
sound judgment and effectiveness in meeting the establishment's 
procedures and expectations. They generally have management and/or 
supervisory responsibilities.
    (h) Retention of documentation. An employer filing an Application 
for Temporary Employment Certification must maintain documentation of 
its wage determination from the NPC as required in this subpart and be 
prepared to submit this documentation with the filing of its 
application. The documentation required in this subpart must be retained 
for a period of no less than 3 years from the date of the certification. 
There is no record retention requirement for applications (and 
supporting documentation) that are denied.



Sec.  655.1309  Labor certification determinations.

    (a) COs. The Administrator, OFLC is the Department's National CO. 
The Administrator, OFLC, and the CO(s) in the NPC(s) (by virtue of 
delegation from the Administrator, OFLC), have the authority to certify 
or deny applications for temporary employment certification under the H-
2A nonimmigrant classification. If the Administrator, OFLC has directed 
that certain types of temporary labor certification applications or 
specific applications under the H-2A nonimmigrant classification be 
handled by the National OFLC, the Director(s) of the NPC(s) will refer 
such applications to the Administrator, OFLC.
    (b) Determination. No later than 30 calendar days before the date of 
need, as identified in the Application for Temporary Employment 
Certification, except as provided for underSec. 655.107(c) for 
modified applications, or applications not otherwise meeting 
certification criteria by that date, the CO will make a determination 
either to grant or deny the Application for Temporary Employment 
Certification. The CO will grant the application if and only if: the 
employer has met the requirements of this subpart, including the 
criteria for certification set forth inSec. 655.107(a), and thus the 
employment of the H-2A workers will not adversely affect the wages and 
working conditions of similarly employed U.S. workers.
    (c) Notification. The CO will notify the employer in writing (either 
electronically or by mail) of the labor certification determination.
    (d) Approved certification. If temporary labor certification is 
granted, the CO must send the certified Application for Temporary 
Employment Certification and a Final Determination letter to the 
employer, or, if appropriate, to the employer's agent or attorney. The 
Final Determination letter will notify the employer to file the 
certified application and any other documentation required by USCIS with 
the appropriate USCIS office and to continue to cooperate with the SWA 
by accepting all referrals of eligible U.S. workers who apply (or on 
whose behalf an application is made) for the job opportunity until the 
end of the recruitment period as set forth inSec. 655.102(f)(3). 
However, the employer will not be required to accept referrals of 
eligible U.S. workers once it has hired or extended employment offers to 
eligible U.S. workers equal to the number of H-2A workers sought.
    (e) Denied certification. If temporary labor certification is 
denied, the Final Determination letter will be sent to the employer by 
means normally assuring next-day delivery. The Final Determination 
Letter will:
    (1) State the reasons certification is denied, citing the relevant 
regulatory standards and/or special procedures;
    (2) If applicable, address the availability of U.S. workers in the 
occupation as well as the prevailing benefits, wages, and working 
conditions of similarly employed U.S. workers in the occupation and/or 
any applicable special procedures;
    (3) Offer the applicant an opportunity to request an expedited 
administrative review, or a de novo administrative hearing before an 
ALJ, of the denial. The notice must state that in order to obtain such a 
review or hearing, the employer, within 7 calendar days of the date of 
the notice, must file by facsimile (fax), telegram, or other means 
normally assuring next day delivery, a written request to the Chief 
Administrative Law Judge of DOL (giving the address) and simultaneously 
serve a

[[Page 771]]

copy on the CO. The notice will also state that the employer may submit 
any legal arguments which the employer believes will rebut the basis of 
the CO's action; and
    (4) State that if the employer does not request an expedited 
administrative judicial review or a de novo hearing before an ALJ within 
the 7 calendar days, the denial is final and the Department will not 
further consider that application for temporary alien agricultural labor 
certification.
    (f) Partial certification. The CO may, to ensure compliance with all 
regulatory requirements, issue a partial certification, reducing either 
the period of need or the number of H-2A workers being requested or both 
for certification, based upon information the CO receives in the course 
of processing the temporary labor certification application, an audit, 
or otherwise. The number of workers certified shall be reduced by one 
for each referred U.S. worker who is qualified, able, available and 
willing. If a partial labor certification is issued, the Final 
Determination letter will:
    (1) State the reasons for which either the period of need and/or the 
number of H-2A workers requested has been reduced, citing the relevant 
regulatory standards and/or special procedures;
    (2) If applicable, address the availability of U.S. workers in the 
occupation;
    (3) Offer the applicant an opportunity to request an expedited 
administrative review, or a de novo administrative hearing before an 
ALJ, of the decision. The notice will state that in order to obtain such 
a review or hearing, the employer, within 7 calendar days of the date of 
the notice, will file by facsimile or other means normally assuring next 
day delivery a written request to the Chief Administrative Law Judge of 
DOL (giving the address) and simultaneously serve a copy on the CO. The 
notice will also state that the employer may submit any legal arguments 
which the employer believes will rebut the basis of the CO's action; and
    (4) State that if the employer does not request an expedited 
administrative judicial review or a de novo hearing before an ALJ within 
the 7 calendar days, the denial is final and the Department will not 
further consider that application for temporary alien agricultural labor 
certification.
    (g) Appeal procedures. If the employer timely requests an expedited 
administrative review or de novo hearing before an ALJ under paragraph 
(e)(3) or (f)(3) of this section, the procedures atSec. 655.115 will 
be followed.
    (h) Payment of processing fees. A determination by the CO to grant 
an Application for Temporary Employment Certification in whole or in 
part under paragraph (d) or (f) of this section will include a bill for 
the required fees. Each employer of H-2A workers under the Application 
for Temporary Employment Certification (except joint employer 
associations, which shall not be assessed a fee in addition to the fees 
assessed to the members of the association) must pay in a timely manner 
a non-refundable fee upon issuance of the certification granting the 
application (in whole or in part), as follows:
    (1) Amount. The application fee for each employer receiving a 
temporary agricultural labor certification is $100 plus $10 for each H-
2A worker certified under the Application for Temporary Employment 
Certification, provided that the fee to an employer for each temporary 
agricultural labor certification received will be no greater than 
$1,000. There is no additional fee to the association filing the 
application. The fees must be paid by check or money order made payable 
to ``United States Department of Labor.'' In the case of H-2A employers 
that are members of an agricultural association acting as a joint 
employer applying on their behalf, the aggregate fees for all employers 
of H-2A workers under the application must be paid by one check or money 
order.
    (2) Timeliness. Fees received by the CO no more than 30 days after 
the date the temporary labor certification is granted will be considered 
timely. Non-payment of fees by the date that is 30 days after the 
issuance of the certification will be considered a substantial program 
violation and subject to the procedures inSec. 655.115.

[[Page 772]]



Sec.  655.1310  Validity and scope of temporary labor certifications.

    (a) Validity period. A temporary labor certification is valid for 
the duration of the job opportunity for which certification is granted 
to the employer. Except as provided in paragraph and (d) of this 
section, the validity period is that time between the beginning and 
ending dates of certified employment, as listed on the Application for 
Temporary Employment Certification. The certification expires on the 
last day of authorized employment.
    (b) Scope of validity. Except as provided in paragraphs (c) and (d) 
of this section, a temporary labor certification is valid only for the 
number of H-2A workers, the area of intended employment, the specific 
occupation and duties, and the employer(s) specified on the certified 
Application for Temporary Employment Certification (as originally filed 
or as amended) and may not be transferred from one employer to another.
    (c) Scope of validity--associations--(1) Certified applications. If 
an association is requesting temporary labor certification as a joint 
employer, the certified Application for Temporary Employment 
Certification will be granted jointly to the association and to each of 
the association's employer members named on the application. Workers 
authorized by the temporary labor certification may be transferred among 
its certified employer members to perform work for which the temporary 
labor certification was granted, provided the association controls the 
assignment of such workers and maintains a record of such assignments. 
All temporary agricultural labor certifications to associations may be 
used for the certified job opportunities of any of its employer members 
named on the application. If an association is requesting temporary 
labor certification as a sole employer, the certified Application for 
Temporary Employment Certification is granted to the association only.
    (2) Ineligible employer-members. Workers may not be transferred or 
referred to an association's employer member if that employer member has 
been debarred from participation in the H-2A program.
    (d) Extensions on period of employment--(1) Short-term extension. An 
employer who seeks an extension of 2 weeks or less of the certified 
Application for Temporary Employment Certification must apply for such 
extension to DHS. If DHS grants the extension, the corresponding 
Application for Temporary Employment Certification will be deemed 
extended for such period as is approved by DHS.
    (2) Long-term extension. For extensions beyond 2 weeks, an employer 
may apply to the CO at any time for an extension of the period of 
employment on the certified Application for Temporary Employment 
Certification for reasons related to weather conditions or other factors 
beyond the control of the employer (which may include unforeseen changes 
in market conditions), provided that the employer's need for an 
extension is supported in writing, with documentation showing that the 
extension is needed and that the need could not have been reasonably 
foreseen by the employer. The CO will grant or deny the request for 
extension of the period of employment on the Application for Temporary 
Employment Certification based on the available information, and will 
notify the employer of the decision in writing. The employer may appeal 
a denial for a request of an extension in accordance with the procedures 
contained inSec. 655.115. The CO will not grant an extension where the 
total work contract period under that application and extensions would 
be 12 months or more, except in extraordinary circumstances.
    (e) Requests for determinations based on nonavailability of able, 
willing, available, eligible, and qualified U.S. workers--(1) Standards 
for requests. If a temporary labor certification has been partially 
granted or denied based on the CO's determination that able, willing, 
available, eligible, and qualified U.S. workers are available, and, on 
or after 30 calendar days before the date of need, some or all of those 
U.S. workers are, in fact, no longer able, willing, eligible, qualified, 
or available, the employer may request a new temporary labor 
certification determination from the CO. Prior to making a new 
determination the CO will promptly ascertain (which may be through the 
SWA or

[[Page 773]]

other sources of information on U.S. worker availability) whether 
specific able, willing, eligible and qualified replacement U.S. workers 
are available or can be reasonably expected to be present at the 
employer's establishment within 72 hours from the date the employer's 
request was received. The CO will expeditiously, but in no case later 
than 72 hours after the time a complete request (including the signed 
statement included in paragraph (e)(2) of this section) is received, 
make a determination on the request. An employer may appeal a denial of 
such a determination in accordance with the procedures contained in 
Sec.  655.115.
    (2) Unavailability of U.S. workers. The employer's request for a new 
determination must be made directly to the CO by telephone or electronic 
mail, and must be confirmed by the employer in writing as required by 
this paragraph. If the employer telephonically or via electronic mail 
requests the new determination by asserting solely that U.S. workers 
have become unavailable, the employer must submit to the CO a signed 
statement confirming such assertion. If such signed statement is not 
received by the CO within 72 hours of the CO's receipt of the request 
for a new determination, the CO will deny the request.
    (3) Notification of determination. If the CO determines that U.S. 
workers have become unavailable and cannot identify sufficient specific 
able, willing, eligible, and qualified U.S. workers who are or who are 
likely to be available, the CO will grant the employer's request for a 
new determination. However, this does not preclude an employer from 
submitting subsequent requests for new determinations, if warranted, 
based on subsequent facts concerning purported nonavailability of U.S. 
workers or referred workers not being eligible workers or not able, 
willing, or qualified because of lawful job-related reasons.



Sec.  655.1311  Required departure.

    (a) Limit to worker's stay. As defined further in DHS regulations, a 
temporary labor certification limits the authorized period of stay for 
an H-2A worker. See 8 CFR 214.2(h). A foreign worker may not remain 
beyond his or her authorized period of stay, as established by DHS, 
which is based upon the validity period of the labor certification under 
which the H-2A worker is employed, nor beyond separation from employment 
prior to completion of the H-2A contract, absent an extension or change 
of such worker's status under DHS regulations.
    (b) Notice to worker. Upon establishment of a program by DHS for 
registration of departure, an employer must notify any H-2A worker that 
when the worker departs the U.S. by land at the conclusion of employment 
as provided in paragraph (a) of this section, the worker must register 
such departure at the place and in the manner prescribed by DHS.



Sec.  655.1312  Audits.

    (a) Discretion. The Department will conduct audits of temporary 
labor certification applications for which certification has been 
granted. The applications selected for audit will be chosen within the 
sole discretion of the Department.
    (b) Audit letter. Where an application is selected for audit, the CO 
will issue an audit letter to the employer/applicant. The audit letter 
will:
    (1) State the documentation that must be submitted by the employer;
    (2) Specify a date, no fewer than 14 days and no more than 30 days 
from the date of the audit letter, by which the required documentation 
must be received by the CO; and
    (3) Advise that failure to comply with the audit process may result 
in a finding by the CO to:
    (i) Revoke the labor certification as provided inSec. 655.117 and/
or
    (ii) Debar the employer from future filings of H-2A temporary labor 
certification applications as provided inSec. 655.118.
    (c) Supplemental information request. During the course of the audit 
examination, the CO may request supplemental information and/or 
documentation from the employer in order to complete the audit.
    (d) Audit violations. If, as a result of the audit, the CO 
determines the employer failed to produce required documentation, or 
determines that the employer violated the standards set forth

[[Page 774]]

inSec. 655.117(a) with respect to the application, the employer's 
labor certification may be revoked underSec. 655.117 and/or the 
employer may be referred for debarment underSec. 655.118. The CO may 
determine to provide the audit findings and underlying documentation to 
DHS or another appropriate enforcement agency. The CO shall refer any 
findings that an employer discouraged an eligible U.S. worker from 
applying, or failed to hire, discharged, or otherwise discriminated 
against an eligible U.S. worker, to the Department of Justice, Civil 
Rights Division, Office of Special Counsel for Unfair Immigration 
Related Employment Practices.



Sec.  655.1313  H-2A applications involving fraud or willful
misrepresentation.

    (a) Referral for investigation. If the CO discovers possible fraud 
or willful misrepresentation involving an Application for Temporary 
Employment Certification the CO may refer the matter to the DHS and the 
Department's Office of the Inspector General for investigation.
    (b) Terminated processing. If a court or the DHS determines that 
there was fraud or willful misrepresentation involving an Application 
for Temporary Employment Certification, the application will be deemed 
invalid. The determination is not appealable. If a certification has 
been granted, a finding under this paragraph will be cause to revoke the 
certification.



Sec.  655.1314  Setting meal charges; petition for higher meal
charges.

    (a) Meal charges. Until a new amount is set under this paragraph an 
employer may charge workers up to $9.90 for providing them with three 
meals per day. The maximum charge allowed by this paragraph (a) will be 
changed annually by the same percentage as the 12 month percentage 
change for the Consumer Price Index for all Urban Consumers for Food 
between December of the year just concluded and December of the year 
prior to that. The annual adjustments will be effective on the date of 
their publication by the Administrator, OFLC, as a Notice in the Federal 
Register. When a charge or deduction for the cost of meals would bring 
the employee's wage below the minimum wage set by the FLSA at 29 U.S.C. 
206 (FLSA), the charge or deduction must meet the requirements of 29 
U.S.C. 203(m) of the FLSA, including the recordkeeping requirements 
found at 29 CFR 516.27.
    (b) Filing petitions for higher meal charges. The employer may file 
a petition with the CO to charge more than the applicable amount for 
meal charges if the employer justifies the charges and submits to the CO 
the documentation required by paragraph (b)(1) of this section.
    (1) Required documentation. Documentation submitted must include the 
cost of goods and services directly related to the preparation and 
serving of meals, the number of workers fed, the number of meals served 
and the number of days meals were provided. The cost of the following 
items may be included: Food; kitchen supplies other than food, such as 
lunch bags and soap; labor costs that have a direct relation to food 
service operations, such as wages of cooks and dining hall supervisors; 
fuel, water, electricity, and other utilities used for the food service 
operation; and other costs directly related to the food service 
operation. Charges for transportation, depreciation, overhead and 
similar charges may not be included. Receipts and other cost records for 
a representative pay period must be retained and must be available for 
inspection by the CO for a period of 1 year.
    (2) Effective date for higher charge. The employer may begin 
charging the higher rate upon receipt of a favorable decision from the 
CO unless the CO sets a later effective date in the decision.
    (c) Appeal. In the event the employer's petition for a higher meal 
charge is denied in whole or in part, the employer may appeal the 
denial. Appeals will be filed with the Chief Administrative Law Judge. 
ALJ's will hear such appeals according to the procedures in 29 CFR part 
18, except that the appeal will not be considered as a complaint to 
which an answer is required. The decision of the ALJ is the final 
decision of the Secretary.

[[Page 775]]



Sec.  655.1315  Administrative review and de novo hearing before an
administrative law judge.

    (a) Administrative review--(1) Consideration. Whenever an employer 
has requested an administrative review before an ALJ of a decision by 
the CO: Not to accept for consideration an Application for Temporary 
Employment Certification; to deny an Application for Temporary 
Employment Certification; to deny an amendment of an Application for 
Temporary Employment Certification; or to deny an extension of an 
Application for Temporary Employment Certification, the CO will send a 
certified copy of the ETA case file to the Chief Administrative Law 
Judge by means normally assuring next-day delivery. The Chief 
Administrative Law Judge will immediately assign an ALJ (which may be a 
panel of such persons designated by the Chief Administrative Law Judge 
from BALCA established by 20 CFR part 656, which will hear and decide 
the appeal as set forth in this section) to review the record for legal 
sufficiency. The ALJ may not remand the case and may not receive 
evidence in addition to what the CO used to make the determination.
    (2) Decision. Within 5 business days after receipt of the ETA case 
file the ALJ will, on the basis of the written record and after due 
consideration of any written submissions (which may not include new 
evidence) from the parties involved or amici curiae, either affirm, 
reverse, or modify the CO's decision by written decision. The decision 
of the ALJ must specify the reasons for the action taken and must be 
immediately provided to the employer, the CO, the Administrator, OFLC, 
and DHS by means normally assuring next-day delivery. The ALJ's decision 
is the final decision of the Secretary.
    (b) De novo hearing. (1) Request for hearing; conduct of hearing. 
Whenever an employer has requested a de novo hearing before an ALJ of a 
decision by the CO: Not to accept for consideration an Application for 
Temporary Employment Certification; to deny an Application for Temporary 
Employment Certification; to deny an amendment of an Application for 
Temporary Employment Certification; or to deny an extension of an 
Application for Temporary Employment Certification, the CO will send a 
certified copy of the ETA case file to the Chief Administrative Law 
Judge by means normally assuring next-day delivery. The Chief 
Administrative Law Judge will immediately assign an ALJ (which may be a 
panel of such persons designated by the Chief Administrative Law Judge 
from BALCA established by 20 CFR part 656 of this chapter, but which 
will hear and decide the appeal as provided in this section) to conduct 
the de novo hearing. The procedures in 29 CFR part 18 apply to such 
hearings, except that:
    (i) The appeal will not be considered to be a complaint to which an 
answer is required;
    (ii) The ALJ will ensure that the hearing is scheduled to take place 
within 5 calendar days after the ALJ's receipt of the ETA case file, if 
the employer so requests, and will allow for the introduction of new 
evidence; and
    (iii) The ALJ's decision must be rendered within 10 calendar days 
after the hearing.
    (2) Decision. After a de novo hearing, the ALJ must affirm, reverse, 
or modify the CO's determination, and the ALJ's decision must be 
provided immediately to the employer, CO, Administrator, OFLC, and DHS 
by means normally assuring next-day delivery. The ALJ's decision is the 
final decision of the Secretary.



Sec.  655.1316  Job Service Complaint System; enforcement of work 
contracts.

    (a) Complaints arising under this subpart may be filed through the 
Job Service Complaint System, as described in 20 CFR part 658, Subpart 
E. Complaints which involve worker contracts must be referred by the SWA 
to ESA for appropriate handling and resolution, as described in 29 CFR 
part 501. As part of this process, ESA may report the results of its 
investigation to the Administrator, OFLC for consideration of employer 
penalties or such other action as may be appropriate.
    (b) Complaints alleging that an employer discouraged an eligible 
U.S. worker from applying, failed to hire, discharged, or otherwise 
discriminated against an eligible U.S. worker, or discovered violations 
involving the same,

[[Page 776]]

may be referred to the U.S. Department of Justice, Civil Rights 
Division, Office of Special Counsel for Unfair Immigration Related 
Employment Practices (OSC), in addition to any activity, investigation, 
and/or enforcement action taken by ETA or an SWA. Likewise, if OSC 
becomes aware of a violation of these regulations, it may provide such 
information to the appropriate SWA and the CO.



Sec.  655.1317  Revocation of approved labor certifications.

    (a) Basis for DOL revocation. The CO, in consultation with the 
Administrator, OFLC, may revoke a temporary agricultural labor 
certification approved under this subpart, if, after notice and 
opportunity for a hearing (or failure to file rebuttal evidence), it is 
found that any of the following violations were committed with respect 
to that temporary agricultural labor certification:
    (1) The CO finds that issuance of the temporary agricultural labor 
certification was not justified due to a willful misrepresentation on 
the application;
    (2) The CO finds that the employer:
    (i) Willfully violated a material term or condition of the approved 
temporary agricultural labor certification or the H-2A regulations, 
unless otherwise provided under paragraphs (a)(2)(ii) through (iv) of 
this section; or
    (ii) Failed, after notification, to cure a substantial violation of 
the applicable housing standards set out in 20 CFR 655.104(d); or
    (iii) Significantly failed to cooperate with a DOL investigation or 
with a DOL official performing an investigation, inspection, or law 
enforcement function under sec. 218 of the INA at 8 U.S.C. 1188, this 
subpart, or 29 CFR part 501 (ESA enforcement of contractual 
obligations); or
    (iv) Failed to comply with one or more sanctions or remedies imposed 
by the ESA for violation(s) of obligations found by that agency, or with 
one or more decisions or orders of the Secretary or a court order 
secured by the Secretary under sec. 218 of the INA at 8 U.S.C. 1188, 
this subpart, or 29 CFR part 501 (ESA enforcement of contractual 
obligations).
    (3) The CO determines after a recommendation is made by the WHD ESA 
in accordance with 29 CFR 501.20, which governs when a recommendation of 
revocation may be made to ETA, that the conduct complained of upon 
examination meets the standards of paragraph (a)(1) or (2) of this 
section; or
    (4) If a court or the DHS, or, as a result of an audit, the CO, 
determines that there was fraud or willful misrepresentation involving 
the Application for Temporary Employment Certification.
    (b) DOL procedures for revocation. (1) The CO will send to the 
employer (and his attorney or agent) a Notice of Intent to Revoke by 
means normally ensuring next-day delivery, which will contain a detailed 
statement of the grounds for the proposed revocation and the time period 
allowed for the employer's rebuttal. The employer may submit evidence in 
rebuttal within 14 calendar days of the date the notice is issued. The 
CO must consider all relevant evidence presented in deciding whether to 
revoke the temporary agricultural labor certification.
    (2) If rebuttal evidence is not timely filed by the employer, the 
Notice of Intent to Revoke will become the final decision of the 
Secretary and take effect immediately at the end of the 14-day period.
    (3) If, after reviewing the employer's timely filed rebuttal 
evidence, the CO finds that the employer more likely than not meets one 
or more of the bases for revocation underSec. 655.117(a), the CO will 
notify the employer, by means normally ensuring next-day delivery, 
within 14 calendar days after receiving such timely filed rebuttal 
evidence, of his/her final determination that the temporary agricultural 
labor certification should be revoked. The CO's notice will contain a 
detailed statement of the bases for the decision, and must offer the 
employer an opportunity to request a hearing. The notice must state 
that, to obtain such a hearing, the employer must, within 10 calendar 
days of the date of the notice file a written request to the Chief 
Administrative Law Judge, United States Department of Labor, 800 K 
Street, NW., Suite 400-N, Washington, DC 20001-8002, and simultaneously 
serve a copy to the

[[Page 777]]

Administrator, OFLC. The timely filing of a request for a hearing will 
stay the revocation pending the outcome of the hearing.
    (c) Hearing. (1) Within 5 business days of receipt of the request 
for a hearing, the CO will send a certified copy of the ETA case file to 
the Chief Administrative Law Judge by means normally assuring next-day 
delivery. The Chief Administrative Law Judge will immediately assign an 
ALJ to conduct the hearing. The procedures in 29 CFR part 18 apply to 
such hearings, except that:
    (i) The request for a hearing will not be considered to be a 
complaint to which an answer is required;
    (ii) The ALJ will ensure that the hearing is scheduled to take place 
within 15 calendar days after the ALJ's receipt of the ETA case file, if 
the employer so requests, and will allow for the introduction of new 
evidence; and
    (iii) The ALJ's decision must be rendered within 20 calendar days 
after the hearing.
    (2) Decision. After the hearing, the ALJ must affirm, reverse, or 
modify the CO's determination. The ALJ's decision must be provided 
immediately to the employer, CO, Administrator, OFLC, DHS, and DOS by 
means normally assuring next-day delivery. The ALJ's decision is the 
final decision of the Secretary.
    (d) Employer's obligations in the event of revocation. If an 
employer's temporary agricultural labor certification is revoked under 
this section, and the workers have departed the place of recruitment, 
the employer will be responsible for:
    (1) Reimbursement of actual inbound transportation and subsistence 
expenses, as if the worker meets the requirements for payment under 
Sec.  655.104(h)(1);
    (2) The worker's outbound transportation expenses, as if the worker 
meets the requirements for payment underSec. 655.104(h)(2);
    (3) Payment to the worker of the amount due under the three-fourths 
guarantee as required bySec. 655.104(i); and
    (4) Any other wages, benefits, and working conditions due or owing 
to the worker under these regulations.



Sec.  655.1318  Debarment.

    (a) The Administrator, OFLC may not issue future labor 
certifications under this subpart to an employer and any successor in 
interest to the debarred employer, subject to the time limits set forth 
in paragraph (c) of this section, if:
    (1) The Administrator, OFLC finds that the employer substantially 
violated a material term or condition of its temporary labor 
certification with respect to the employment of domestic or nonimmigrant 
workers; and
    (2) The Administrator, OFLC issues a Notice of Intent to Debar no 
later than 2 years after the occurrence of the violation.
    (b) The Administrator, OFLC may not issue future labor 
certifications under this subpart to an employer represented by an agent 
or attorney, subject to the time limits set forth in paragraph (c) of 
this section, if:
    (1) The Administrator, OFLC finds that the agent or attorney 
participated in, had knowledge of, or had reason to know of, an 
employer's substantial violation; and
    (2) The Administrator, OFLC issues the agent or attorney a Notice of 
Intent to Debar no later than 2 years after the occurrence of the 
violation.
    (c) No employer, attorney, or agent may be debarred under this 
subpart for more than 3 years.
    (d) For the purposes of this section, a substantial violation 
includes:
    (1) A pattern or practice of acts of commission or omission on the 
part of the employer or the employer's agent which:
    (i) Are significantly injurious to the wages or benefits required to 
be offered under the H-2A program, or working conditions of a 
significant number of the employer's U.S. or H-2A workers; or
    (ii) Reflect a significant failure to offer employment to all 
qualified domestic workers who applied for the job opportunity for which 
certification was being sought, except for lawful job-related reasons; 
or
    (iii) Reflect a willful failure to comply with the employer's 
obligations to recruit U.S. workers as set forth in this subpart; or

[[Page 778]]

    (iv) Reflect a significant failure to comply with the audit process 
in violation ofSec. 655.112; or
    (v) Reflect the employment of an H-2A worker outside the area of 
intended employment, or in an activity/activities, not listed in the job 
order (other than an activity minor and incidental to the activity/
activities listed in the job order), or after the period of employment 
specified in the job order and any approved extension;
    (2) The employer's persistent or prolonged failure to pay the 
necessary fee in a timely manner, following the issuance of a deficiency 
notice to the applicant and allowing for a reasonable period for 
response;
    (3) Fraud involving the Application for Temporary Employment 
Certification or a response to an audit;
    (4) A significant failure to cooperate with a DOL investigation or 
with a DOL official performing an investigation, inspection, or law 
enforcement function under sec. 218 of the INA at 8 U.S.C. 1188, this 
subpart, or 29 CFR part 501 (ESA enforcement of contractual 
obligations); or
    (5) A significant failure to comply with one or more sanctions or 
remedies imposed by the ESA for violation(s) of obligations found by 
that agency (if applicable), or with one or more decisions or orders of 
the Secretary or a court order secured by the Secretary under sec. 218 
of the INA at 8 U.S.C. 1188, this subpart, or 29 CFR part 501 (ESA 
enforcement of contractual obligations); or
    (6) A single heinous act showing such flagrant disregard for the law 
that future compliance with program requirements cannot reasonably be 
expected.
    (e) DOL procedures for debarment under this section will be as 
follows:
    (1) The Administrator, OFLC will send to the employer, attorney, or 
agent a Notice of Intent to Debar by means normally ensuring next-day 
delivery, which will contain a detailed statement of the grounds for the 
proposed debarment. The employer, attorney or agent may submit evidence 
in rebuttal within 14 calendar days of the date the notice is issued. 
The Administrator, OFLC must consider all relevant evidence presented in 
deciding whether to debar the employer, attorney, or agent.
    (2) If rebuttal evidence is not timely filed by the employer, 
attorney, or agent, the Notice of Intent to Debar will become the final 
decision of the Secretary and take effect immediately at the end of the 
14-day period.
    (3) If, after reviewing the employer's timely filed rebuttal 
evidence, the Administrator, OFLC determines that the employer, 
attorney, or agent more likely than not meets one or more of the bases 
for debarment underSec. 655.118(d), the Administrator, OFLC will 
notify the employer, by means normally ensuring next-day delivery, 
within 14 calendar days after receiving such timely filed rebuttal 
evidence, of his/her final determination of debarment and of the 
employer, attorney, or agent's right to appeal.
    (4) The Notice of Debarment must be in writing, must state the 
reason for the debarment finding, including a detailed explanation of 
the grounds for and the duration of the debarment, and must offer the 
employer, attorney, or agent an opportunity to request a hearing. The 
notice must state that, to obtain such a hearing, the debarred party 
must, within 30 calendar days of the date of the notice, file a written 
request to the Chief Administrative Law Judge, United States Department 
of Labor, 800 K Street, NW., Suite 400-N, Washington, DC 20001-8002, and 
simultaneously serve a copy to the Administrator, OFLC. The debarment 
will take effect 30 days from the date the Notice of Debarment is issued 
unless a request for a hearing is properly filed within 30 days from the 
date the Notice of Debarment is issued. The timely filing of the request 
for a hearing stays the debarment pending the outcome of the hearing.
    (5)(i) Hearing. Within 10 days of receipt of the request for a 
hearing, the Administrator, OFLC will send a certified copy of the ETA 
case file to the Chief Administrative Law Judge by means normally 
assuring next-day delivery. The Chief Administrative Law Judge will 
immediately assign an ALJ to conduct the hearing. The procedures in 29 
CFR part 18 apply to such hearings, except that the request for a 
hearing will not be considered to be a

[[Page 779]]

complaint to which an answer is required;
    (ii) Decision. After the hearing, the ALJ must affirm, reverse, or 
modify the Administrator, OFLC 's determination. The ALJ's decision must 
be provided immediately to the employer, Administrator, OFLC, DHS, and 
DOS by means normally assuring next-day delivery. The ALJ's decision is 
the final decision of the Secretary, unless either party, within 30 
calendar days of the ALJ's decision, seeks review of the decision with 
the Administrative Review Board (ARB).
    (iii) Review by the ARB.
    (A) Any party wishing review of the decision of an ALJ must, within 
30 days of the decision of the ALJ, petition the ARB to review the 
decision. Copies of the petition must be served on all parties and on 
the ALJ. The ARB must decide whether to accept the petition within 30 
days of receipt. If the ARB declines to accept the petition or if the 
ARB does not issue a notice accepting a petition within 30 days after 
the receipt of a timely filing of the petition, the decision of the ALJ 
shall be deemed the final agency action. If a petition for review is 
accepted, the decision of the ALJ shall be stayed unless and until the 
ARB issues an order affirming the decision. The ARB must serve notice of 
its decision to accept or not to accept the petition upon the ALJ and 
upon all parties to the proceeding in person or by certified mail.
    (B) Upon receipt of the ARB's notice to accept the petition, the 
Office of Administrative Law Judges shall promptly forward a copy of the 
complete hearing record to the ARB.
    (C) Where the ARB has determined to review such decision and order, 
the ARB shall notify each party of:
    (1) The issue or issues raised;
    (2) The form in which submissions shall be made (i.e., briefs, oral 
argument, etc.); and
    (3) The time within which such presentation shall be submitted.
    (D) The ARB's final decision must be issued within 90 days from the 
notice granting the petition and served upon all parties and the ALJ, in 
person or by certified mail. If the ARB fails to provide a decision 
within 90 days from the notice granting the petition, the ALJ's decision 
will be the final decision of the Secretary.
    (f) Debarment involving members of associations. If the 
Administrator, OFLC determines a substantial violation has occurred, and 
if an individual employer-member of an agricultural association acting 
as a joint employer is determined to have committed the violation, the 
debarment determination will apply only to that member of the 
association unless the Administrator, OFLC determines that the 
association or other association members participated in the violation, 
in which case the debarment will be invoked against the complicit 
association or other association members.
    (g) Debarment involving agricultural associations acting as joint 
employers. If the Administrator, OFLC determines a substantial violation 
has occurred, and if an agricultural association acting as a joint 
employer with its members is found to have committed the violation, the 
debarment determination will apply only to the association, and will not 
be applied to any individual employer-member of the association unless 
the Administrator, OFLC determines that the member participated in the 
violation, in which case the debarment will be invoked against any 
complicit association members as well. An association debarred from the 
H-2A temporary labor certification program will not be permitted to 
continue to file as a joint employer with its members during the period 
of the debarment.
    (h) Debarment involving agricultural associations acting as sole 
employers. If the Administrator, OFLC determines a substantial violation 
has occurred, and if an agricultural association acting as a sole 
employer is determined to have committed the violation, the debarment 
determination will apply only to the association and any successor in 
interest to the debarred association.



Sec.  655.1319  Document retention requirements.

    (a) Entities required to retain documents. All employers receiving a 
certification of the Application for Temporary Employment Certification 
for agricultural workers under this subpart are required to retain the 
documents and

[[Page 780]]

records as provided in the regulations cited in paragraph (c) of this 
section.
    (b) Period of required retention. Records and documents must be 
retained for a period of 3 years from the date of certification of the 
Application for Temporary Employment Certification.
    (c) Documents and records to be retained. (1) All applicants must 
retain the following documentation:
    (i) Proof of recruitment efforts including:
    (A) Job order placement as specified inSec. 655.102(e)(1);
    (B) Advertising as specified inSec. 655.102(g)(3), or, if used, 
professional, trade, or ethnic publications;
    (C) Contact with former U.S. workers as specified inSec. 
655.102(h);
    (D) Multi-state recruitment efforts (if required underSec. 
655.102(i)) as specified inSec. 655.102(g)(3);
    (ii) Substantiation of information submitted in the recruitment 
report prepared in accordance withSec. 655.102(k)(2), such as evidence 
of non-applicability of contact of former employees as specified in 
Sec.  655.102(h);
    (iii) The supplemental recruitment report as specified inSec. 
655.102(k) and any supporting resumes and contact information as 
specified inSec. 655.102(k)(3);
    (iv) Proof of workers' compensation insurance or State law coverage 
as specified inSec. 655.104(e);
    (v) Records of each worker's earnings as specified inSec. 
655.104(j);
    (vi) The work contract or a copy of the Application for Temporary 
Employment Certification as defined in 29 CFR 501.10 and specified in 
Sec.  655.104(q);
    (vii) The wage determination provided by the NPC as specified in 
Sec.  655.108;
    (viii) Copy of the request for housing inspection submitted to the 
SWA as specified inSec. 655.104(d); and
    (2) In addition to the documentation specified in paragraph (c)(1) 
of this section, H-2ALCs must also retain:
    (i) Statements of compliance with the housing and transportation 
obligations for each fixed-site employer which provided housing or 
transportation and to which the H-2ALC provided workers during the 
validity period of the certification, unless such housing and 
transportation obligations were met by the H-2ALC itself, in which case 
proof of compliance by the H-2ALC must be retained, as specified in 
Sec.  655.101(a)(5);
    (ii) Proof of surety bond coverage which includes the name, address, 
and phone number of the surety, the bond number of other identifying 
designation, the amount of coverage, and the payee, as specified in 29 
CFR 501.8; and
    (3) Associations filing must retain documentation substantiating 
their status as an employer or agent, as specified inSec. 
655.101(a)(1).



PART 656_LABOR CERTIFICATION PROCESS FOR PERMANENT EMPLOYMENT OF 
ALIENS IN THE UNITED STATES--Table of Contents



                 Subpart A_Purpose and Scope of Part 656

Sec.
656.1 Purpose and scope of part 656.
656.2 Description of the Immigration and Nationality Act and of the 
          Department of Labor's role thereunder.
656.3 Definitions, for purposes of this part, of terms used in this 
          part.

        Subpart B_Occupational Labor Certification Determinations

656.5 Schedule A.

                  Subpart C_Labor Certification Process

656.10 General instructions.
656.11 Substitutions and modifications to applications.
656.12 Improper commerce and payment.
656.15 Applications for labor certification for Schedule A occupations.
656.16 Labor certification applications for sheepherders.
656.17 Basic labor certification process.
656.18 Optional special recruitment and documentation procedures for 
          college and university teachers.
656.19 Live-in household domestic service workers.
656.20 Audit procedures.
656.21 Supervised recruitment.
656.24 Labor certification determinations.
656.26 Board of Alien Labor Certification Appeals review of denials of 
          labor certification.
656.27 Consideration by and decisions of the Board of Alien Labor 
          Certification Appeals.
656.30 Validity and invalidation of labor certifications.
656.31 Labor certification applications involving fraud, willful 
          misrepresentation, or violations of this part.

[[Page 781]]

656.32 Revocation of approved labor certifications.

               Subpart D_Determination of Prevailing Wage

656.40 Determination of prevailing wage for labor certification 
          purposes.
656.41 Review of prevailing wage determinations.

    Authority: 8 U.S.C. 1182(a)(5)(A), 1182(p)(1); sec.122, Public Law 
101-649, 109 Stat. 4978; and Title IV, Public Law 105-277, 112 Stat. 
2681.

    Source: 69 FR 77386, Dec. 27, 2004, unless otherwise noted.



                 Subpart A_Purpose and Scope of Part 656



Sec.  656.1  Purpose and scope of part 656.

    (a) Under section 212(a)(5)(A) of the Immigration and Nationality 
Act (INA or Act) (8 U.S.C. 1182(a)(5)(A)), certain aliens may not obtain 
immigrant visas for entrance into the United States in order to engage 
in permanent employment unless the Secretary of Labor has first 
certified to the Secretary of State and to the Secretary of Homeland 
Security that:
    (1) There are not sufficient United States workers who are able, 
willing, qualified and available at the time of application for a visa 
and admission into the United States and at the place where the alien is 
to perform the work; and
    (2) The employment of the alien will not adversely affect the wages 
and working conditions of United States workers similarly employed.
    (b) The regulations under this part set forth the procedures through 
which such immigrant labor certifications may be applied for, and 
granted or denied.
    (c) Correspondence and questions about the regulations in this part 
should be addressed to: Office of Foreign Labor Certification, 
Employment and Training Administration, 200 Constitution Avenue, NW., 
Room C-4312, Washington, DC 20210.

[69 FR 77386, Dec. 27, 2004, as amended at 71 FR 35522, June 21, 2006]



Sec.  656.2  Description of the Immigration and Nationality Act and
of the Department of Labor's role thereunder.

    (a) Description of the Act. The Act (8 U.S.C. 1101 et seq.) 
regulates the admission of aliens into the United States. The Act 
designates the Secretary of Homeland Security and the Secretary of State 
as the principal administrators of its provisions.
    (b) Burden of proof under the Act. Section 291 of the Act (8 U.S.C. 
1361) provides, in pertinent part, that:

    Whenever any person makes application for a visa or any other 
documentation required for entry, or makes application for admission, or 
otherwise attempts to enter the United States, the burden of proof shall 
be upon such person to establish that he is eligible to receive such 
visa or such document, or is not subject to exclusion under any 
provision of this Act * * *.

    (c)(1) Role of the Department of Labor. The permanent labor 
certification role of the Department of Labor under the Act derives from 
section 212(a)(5)(A) (8 U.S.C. 1182(a)(5)(A)), which provides that any 
alien who seeks admission or status as an immigrant for the purpose of 
employment under paragraph (2) or (3) of section 203(b) of the Act may 
not be admitted unless the Secretary of Labor has first certified to the 
Secretary of State and to the Secretary of Homeland Security that:
    (i) There are not sufficient United States workers who are able, 
willing, qualified, and available at the time of application for a visa 
and admission to the United States and at the place where the alien is 
to perform such skilled or unskilled labor; and
    (ii) The employment of such alien will not adversely affect the 
wages and working conditions of workers in the United States similarly 
employed.
    (2) This certification is referred to in this part 656 as a ``labor 
certification.''
    (3) We certify the employment of aliens in several instances: For 
the permanent employment of aliens under this part; and for temporary 
employment of aliens for agricultural and nonagricultural employment in 
the United States classified under 8 U.S.C. 1101(a)(15)(H)(ii), under 
the DHS regulation at 8 CFR 214.2(h)(5) and (6) and sections 
101(a)(15)(H)(ii), 214, and 218 of the

[[Page 782]]

Act. See 8 U.S.C. 1101(a)(15)(H)(ii), 1184, and 1188. We also administer 
labor attestation and labor condition application programs for the 
admission and/or work authorization of the following nonimmigrants: 
Specialty occupations and fashion models (H-1B visas), specialty 
occupations from countries with which the U.S. has entered agreements 
listed in the INA (H-1B1 visas), registered nurses (H-1C visas), and 
crewmembers performing longshore work (D visas), classified under 8 
U.S.C. 1101(a)(15)(H)(i)(b), 1101(a)(15)(H)(i)(b1), 
1101(a)(15)(H)(i)(c), and 1101(a)(15)(D), respectively. See also 8 
U.S.C. 1184(c), (m), and (n), and 1288.



Sec.  656.3  Definitions, for purposes of this part, of terms used
in this part.

    Act means the Immigration and Nationality Act, as amended, 8 U.S.C. 
1101 et seq.
    Agent means a person who is not an employee of an employer, and who 
has been designated in writing to act on behalf of an alien or employer 
in connection with an application for labor certification.
    Applicant means a U.S. worker (see definition of U.S. worker below) 
who is applying for a job opportunity for which an employer has filed an 
Application for Permanent Employment Certification (ETA Form 9089).
    Application means an Application for Permanent Employment 
Certification submitted by an employer (or its agent or attorney) in 
applying for a labor certification under this part.
    Area of intended employment means the area within normal commuting 
distance of the place (address) of intended employment. There is no 
rigid measure of distance which constitutes a normal commuting distance 
or normal commuting area, because there may be widely varying factual 
circumstances among different areas (e.g., normal commuting distances 
might be 20, 30, or 50 miles). If the place of intended employment is 
within a Metropolitan Statistical Area (MSA) or a Primary Metropolitan 
Statistical Area (PMSA), any place within the MSA or PMSA is deemed to 
be within normal commuting distance of the place of intended employment; 
however, not all locations within a Consolidated Metropolitan 
Statistical Area (CMSA) will be deemed automatically to be within normal 
commuting distance. The borders of MSA's and PMSA's are not controlling 
in the identification of the normal commuting area; a location outside 
of an MSA or PMSA (or a CMSA) may be within normal commuting distance of 
a location that is inside (e.g., near the border of) the MSA or PMSA (or 
CMSA). The terminology CMSAs and PMSAs are being replaced by the Office 
of Management and Budget (OMB). However, ETA will continue to recognize 
the use of these area concepts as well as their replacements.
    Attorney means any person who is a member in good standing of the 
bar of the highest court of any state, possession, territory, or 
commonwealth of the United States, or the District of Columbia, and who 
is not under suspension or disbarment from practice before any court or 
before DHS or the United States Department of Justice's Executive Office 
for Immigration Review. Such a person is permitted to act as an agent, 
representative, or attorney for an employer and/or alien under this 
part.
    Barter, for purposes of an Application for Permanent Employment 
Certification (Form ETA 9089) or an Application for Alien Labor 
Certification (Form ETA 750), means the transfer of ownership of a labor 
certification application or certification from one person to another by 
voluntary act or agreement in exchange for a commodity, service, 
property or other valuable consideration.
    Board of Alien Labor Certification Appeals (BALCA or Board) means 
the permanent Board established by this part, chaired by the Chief 
Administrative Law Judge, and consisting of Administrative Law Judges 
assigned to the Department of Labor and designated by the Chief 
Administrative Law Judge to be members of the Board of Alien Labor 
Certification Appeals. The Board of Alien Labor Certification Appeals is 
located in Washington, DC, and reviews and decides appeals in 
Washington, DC.
    Certifying Officer (CO) means a Department of Labor official who 
makes determinations about whether or not to grant applications for 
labor certifications.

[[Page 783]]

    Closely-held Corporation means a corporation that typically has 
relatively few shareholders and whose shares are not generally traded in 
the securities market.
    Employer means:
    (1) A person, association, firm, or a corporation that currently has 
a location within the United States to which U.S. workers may be 
referred for employment and that proposes to employ a full-time employee 
at a place within the United States, or the authorized representative of 
such a person, association, firm, or corporation. An employer must 
possess a valid Federal Employer Identification Number (FEIN). For 
purposes of this definition, an ``authorized representative'' means an 
employee of the employer whose position or legal status authorizes the 
employee to act for the employer in labor certification matters. A labor 
certification can not be granted for an Application for Permanent 
Employment Certification filed on behalf of an independent contractor.
    (2) Persons who are temporarily in the United States, including but 
not limited to, foreign diplomats, intra-company transferees, students, 
and exchange visitors, visitors for business or pleasure, and 
representatives of foreign information media can not be employers for 
the purpose of obtaining a labor certification for permanent employment.
    Employment means:
    (1) Permanent, full-time work by an employee for an employer other 
than oneself. For purposes of this definition, an investor is not an 
employee. In the event of an audit, the employer must be prepared to 
document the permanent and full-time nature of the position by 
furnishing position descriptions and payroll records for the job 
opportunity involved in the Application for Permanent Employment 
Certification.
    (2) Job opportunities consisting solely of job duties that will be 
performed totally outside the United States, its territories, 
possessions, or commonwealths can not be the subject of an Application 
for Permanent Employment Certification.
    Employment and Training Administration (ETA) means the agency within 
the Department of Labor (DOL) that includes the Office of Foreign Labor 
Certification (OFLC).
    Immigration Officer means an official of the Department of Homeland 
Security, United States Citizenship and Immigration Services (USCIS) who 
handles applications for labor certifications under this part.
    Job opportunity means a job opening for employment at a place in the 
United States to which U.S. workers can be referred.
    Nonprofessional occupation means any occupation for which the 
attainment of a bachelor's or higher degree is not a usual requirement 
for the occupation.
    Non-profit or tax-exempt organization for the purposes ofSec. 
656.40 means an organization that:
    (1) Is defined as a tax exempt organization under the Internal 
Revenue Code of 1986, section 501(c)(3), (c)(4), or (c)(6) (26 U.S.C. 
501(c)(3), (c)(4) or (c)(6)); and
    (2) Has been approved as a tax-exempt organization for research or 
educational purposes by the Internal Revenue Service.
    Office of Foreign Labor Certification means the organizational 
component within the Employment and Training Administration that 
provides national leadership and policy guidance and develops 
regulations and procedures to carry out the responsibilities of the 
Secretary of Labor under the Immigration and Nationality Act, as 
amended, concerning alien workers seeking admission to the United States 
in order to work under section 212(a)(5)(A) of the Immigration and 
Nationality Act, as amended.
    O*NET means the system developed by the Department of Labor, 
Employment and Training Administration, to provide to the general public 
information on skills, abilities, knowledge, work activities, interests 
and specific vocational preparation levels associated with occupations. 
O*NET is based on the Standard Occupational Classification system. 
Further information about O*NET can be found at http://
www.onetcenter.org.
    Prevailing wage determination (PWD) means the prevailing wage 
provided or approved by an OFLC National Processing Center (NPC), in 
accordance with OFLC guidance governing foreign

[[Page 784]]

labor certification programs. This includes PWD requests processed for 
purposes of employer petitions filed with DHS under Schedule A or for 
sheepherders.
    Professional occupation means an occupation for which the attainment 
of a bachelor's or higher degree is a usual education requirement. A 
beneficiary of an application for permanent alien employment 
certification involving a professional occupation need not have a 
bachelor's or higher degree to qualify for the professional occupation. 
However, if the employer is willing to accept work experience in lieu of 
a baccalaureate or higher degree, such work experience must be 
attainable in the U.S. labor market and must be stated on the 
application form. If the employer is willing to accept an equivalent 
foreign degree, it must be clearly stated on the Application for 
Permanent Employment Certification form.
    Purchase, for purposes of an Application for Permanent Employment 
Certification (Form ETA 9089) or an Application for Alien Labor 
Certification (Form ETA 750), means the transfer of ownership of a labor 
certification application or certification from one person to another by 
voluntary act and agreement, based on a valuable consideration.
    Sale, for purposes of an Application for Permanent Employment 
Certification (Form ETA 9089) or an Application for Alien Labor 
Certification (Form ETA 750), means an agreement between two parties, 
called, respectively, the seller (or vendor) and the buyer (or 
purchaser) by which the seller, in consideration of the payment or 
promise of payment of a certain price in money terms, transfers 
ownership of a labor certification application or certification to the 
buyer.
    Secretary means the Secretary of Labor, the chief official of the 
U.S. Department of Labor, or the Secretary's designee.
    Secretary of Homeland Security means the chief official of the U.S. 
Department of Homeland Security or the Secretary of Homeland Security's 
designee.
    Secretary of State means the chief official of the U.S. Department 
of State or the Secretary of State's designee.
    Specific vocational preparation (SVP) means the amount of lapsed 
time required by a typical worker to learn the techniques, acquire the 
information, and develop the facility needed for average performance in 
a specific job-worker situation. Lapsed time is not the same as work 
time. For example, 30 days is approximately 1 month of lapsed time and 
not six 5-day work weeks, and 3 months refers to 3 calendar months and 
not 90 work days. The various levels of specific vocational preparation 
are provided below.

------------------------------------------------------------------------
              Level                                Time
------------------------------------------------------------------------
1...............................  Short demonstration.
2...............................  Anything beyond short demonstration up
                                   to and including 30 days.
3...............................  Over 30 days up to and including 3
                                   months.
4...............................  Over 3 months up to and including 6
                                   months.
5...............................  Over 6 months up to and including 1
                                   year.
6...............................  Over 1 year up to and including 2
                                   years.
7...............................  Over 2 years up to and including 4
                                   years.
8...............................  Over 4 years up to and including 10
                                   years.
9...............................  Over 10 years.
------------------------------------------------------------------------

    State Workforce Agency (SWA), formerly known as State Employment 
Security Agency (SESA), means the state agency that receives funds under 
the Wagner-Peyser Act to provide employment-related services to U.S. 
workers and employers and/or administers the public labor exchange 
delivered through the state's one-stop delivery system in accordance 
with the Wagner-Peyser Act.
    United States, when used in a geographic sense, means the 50 states, 
the District of Columbia, Puerto Rico, the U.S. Virgin Islands, and 
Guam.
    United States worker means any worker who is:
    (1) A U.S. citizen;
    (2) A U.S. national;
    (3) Lawfully admitted for permanent residence;
    (4) Granted the status of an alien lawfully admitted for temporary 
residence under 8 U.S.C. 1160(a), 1161(a), or 1255a(a)(1);
    (5) Admitted as a refugee under 8 U.S.C. 1157; or
    (6) Granted asylum under 8 U.S.C. 1158.

[69 FR 77386, Dec. 27, 2004, as amended at 71 FR 35522, June 21, 2006; 
72 FR 27944, May 17, 2007; 73 FR 78068, Dec. 19, 2008]

[[Page 785]]



        Subpart B_Occupational Labor Certification Determinations



Sec.  656.5  Schedule A.

    We have determined there are not sufficient United States workers 
who are able, willing, qualified, and available for the occupations 
listed below on Schedule A and the wages and working conditions of 
United States workers similarly employed will not be adversely affected 
by the employment of aliens in Schedule A occupations. An employer 
seeking a labor certification for an occupation listed on Schedule A may 
apply for that labor certification underSec. 656.15.

                               Schedule A

    (a) Group I:
    (1) Persons who will be employed as physical therapists, and who 
possess all the qualifications necessary to take the physical therapist 
licensing examination in the state in which they propose to practice 
physical therapy.
    (2) Aliens who will be employed as professional nurses; and
    (i) Who have received a Certificate from the Commission on Graduates 
of Foreign Nursing Schools (CGFNS);
    (ii) Who hold a permanent, full and unrestricted license to practice 
professional nursing in the state of intended employment; or
    (iii) Who have passed the National Council Licensure Examination for 
Registered Nurses (NCLEX-RN), administered by the National Council of 
State Boards of Nursing.
    (3) Definitions of Group I occupations:
    (i) Physical therapist means a person who applies the art and 
science of physical therapy to the treatment of patients with 
disabilities, disorders and injuries to relieve pain, develop or restore 
function, and maintain performance, using physical means, such as 
exercise, massage, heat, water, light, and electricity, as prescribed by 
a physician (or a surgeon).
    (ii) Professional nurse means a person who applies the art and 
science of nursing which reflects comprehension of principles derived 
from the physical, biological and behavioral sciences. Professional 
nursing generally includes making clinical judgments involving the 
observation, care and counsel of persons requiring nursing care; 
administering of medicines and treatments prescribed by the physician or 
dentist; and participation in the activities for the promotion of health 
and prevention of illness in others. A program of study for professional 
nurses generally includes theory and practice in clinical areas such as 
obstetrics, surgery, pediatrics, psychiatry, and medicine.
    (b) Group II:
    (1) Sciences or arts (except performing arts). Aliens (except for 
aliens in the performing arts) of exceptional ability in the sciences or 
arts including college and university teachers of exceptional ability 
who have been practicing their science or art during the year prior to 
application and who intend to practice the same science or art in the 
United States. For purposes of this group, the term ``science or art'' 
means any field of knowledge and/or skill with respect to which colleges 
and universities commonly offer specialized courses leading to a degree 
in the knowledge and/or skill. An alien, however, need not have studied 
at a college or university in order to qualify for the Group II 
occupation.
    (2) Performing arts. Aliens of exceptional ability in the performing 
arts whose work during the past 12 months did require, and whose 
intended work in the United States will require, exceptional ability.



                  Subpart C_Labor Certification Process



Sec.  656.10  General instructions.

    (a) Filing of applications. A request for a labor certification on 
behalf of any alien who is required by the Act to be a beneficiary of a 
labor certification in order to obtain permanent resident status in the 
United States may be filed as follows:
    (1) Except as provided in paragraphs (a)(2), (3), and (4) of this 
section, an employer seeking a labor certification must file under this 
section andSec. 656.17.
    (2) An employer seeking a labor certification for a college or 
university teacher must apply for a labor certification under this 
section and must also file under eitherSec. 656.17 orSec. 656.18.

[[Page 786]]

    (3) An employer seeking labor certification for an occupation listed 
on Schedule A must apply for a labor certification under this section 
andSec. 656.15.
    (4) An employer seeking labor certification for a sheepherder must 
apply for a labor certification under this section and must also choose 
to file under eitherSec. 656.16 orSec. 656.17.
    (b) Representation. (1) Employers may have agents or attorneys 
represent them throughout the labor certification process. If an 
employer intends to be represented by an agent or attorney, the employer 
must sign the statement set forth on the Application for Permanent 
Employment Certification form: That the attorney or agent is 
representing the employer and the employer takes full responsibility for 
the accuracy of any representations made by the attorney or agent. 
Whenever, under this part, any notice or other document is required to 
be sent to the employer, the document will be sent to the attorney or 
agent who has been authorized to represent the employer on the 
Application for Permanent Employment Certification form.
    (2)(i) It is contrary to the best interests of U.S. workers to have 
the alien and/or agents or attorneys for either the employer or the 
alien participate in interviewing or considering U.S. workers for the 
job offered the alien. As the beneficiary of a labor certification 
application, the alien can not represent the best interests of U.S. 
workers in the job opportunity. The alien's agent and/or attorney can 
not represent the alien effectively and at the same time truly be 
seeking U.S. workers for the job opportunity. Therefore, the alien and/
or the alien's agent and/or attorney may not interview or consider U.S. 
workers for the job offered to the alien, unless the agent and/or 
attorney is the employer's representative, as described in paragraph 
(b)(2)(ii) of this section.
    (ii) The employer's representative who interviews or considers U.S. 
workers for the job offered to the alien must be the person who normally 
interviews or considers, on behalf of the employer, applicants for job 
opportunities such as that offered the alien, but which do not involve 
labor certifications.
    (3) No person under suspension or disbarment from practice before 
any court or before the DHS or the United States Department of Justice's 
Executive Office for Immigration Review is permitted to act as an agent, 
representative, or attorney for an employer and/or alien under this 
part.
    (c) Attestations. The employer must certify to the conditions of 
employment listed below on the Application for Permanent Employment 
Certification under penalty of perjury under 18 U.S.C. 1621 (2). Failure 
to attest to any of the conditions listed below results in a denial of 
the application.
    (1) The offered wage equals or exceeds the prevailing wage 
determined pursuant toSec. 656.40 andSec. 656.41, and the wage the 
employer will pay to the alien to begin work will equal or exceed the 
prevailing wage that is applicable at the time the alien begins work or 
from the time the alien is admitted to take up the certified employment;
    (2) The wage offered is not based on commissions, bonuses or other 
incentives, unless the employer guarantees a prevailing wage paid on a 
weekly, bi-weekly, or monthly basis that equals or exceeds the 
prevailing wage;
    (3) The employer has enough funds available to pay the wage or 
salary offered the alien;
    (4) The employer will be able to place the alien on the payroll on 
or before the date of the alien's proposed entrance into the United 
States;
    (5) The job opportunity does not involve unlawful discrimination by 
race, creed, color, national origin, age, sex, religion, handicap, or 
citizenship;
    (6) The employer's job opportunity is not:
    (i) Vacant because the former occupant is on strike or locked out in 
the course of a labor dispute involving a work stoppage;
    (ii) At issue in a labor dispute involving a work stoppage.
    (7) The job opportunity's terms, conditions and occupational 
environment are not contrary to Federal, state or local law;
    (8) The job opportunity has been and is clearly open to any U.S. 
worker;
    (9) The U.S. workers who applied for the job opportunity were 
rejected for lawful job-related reasons;

[[Page 787]]

    (10) The job opportunity is for full-time, permanent employment for 
an employer other than the alien.
    (d) Notice. (1) In applications filed under Sec.Sec. 656.15 
(Schedule A), 656.16 (Sheepherders), 656.17 (Basic Process), 656.18 
(College and University Teachers), and 656.21 (Supervised Recruitment), 
the employer must give notice of the filing of the Application for 
Permanent Employment Certification and be able to document that notice 
was provided, if requested by the Certifying Officer, as follows:
    (i) To the bargaining representative(s) (if any) of the employer's 
employees in the occupational classification for which certification of 
the job opportunity is sought in the employer's location(s) in the area 
of intended employment. Documentation may consist of a copy of the 
letter and a copy of the Application for Permanent Employment 
Certification form that was sent to the bargaining representative.
    (ii) If there is no such bargaining representative, by posted notice 
to the employer's employees at the facility or location of the 
employment. The notice must be posted for at least 10 consecutive 
business days. The notice must be clearly visible and unobstructed while 
posted and must be posted in conspicuous places where the employer's 
U.S. workers can readily read the posted notice on their way to or from 
their place of employment. Appropriate locations for posting notices of 
the job opportunity include locations in the immediate vicinity of the 
wage and hour notices required by 29 CFR 516.4 or occupational safety 
and health notices required by 29 CFR 1903.2(a). In addition, the 
employer must publish the notice in any and all in-house media, whether 
electronic or printed, in accordance with the normal procedures used for 
the recruitment of similar positions in the employer's organization. The 
documentation requirement may be satisfied by providing a copy of the 
posted notice and stating where it was posted, and by providing copies 
of all the in-house media, whether electronic or print, that were used 
to distribute notice of the application in accordance with the 
procedures used for similar positions within the employer's 
organization.
    (2) In the case of a private household, notice is required under 
this paragraph (d) only if the household employs one or more U.S. 
workers at the time the application for labor certification is filed. 
The documentation requirement may be satisfied by providing a copy of 
the posted notice to the Certifying Officer.
    (3) The notice of the filing of an Application for Permanent 
Employment Certification must:
    (i) State the notice is being provided as a result of the filing of 
an application for permanent alien labor certification for the relevant 
job opportunity;
    (ii) State any person may provide documentary evidence bearing on 
the application to the Certifying Officer of the Department of Labor;
    (iii) Provide the address of the appropriate Certifying Officer; and
    (iv) Be provided between 30 and 180 days before filing the 
application.
    (4) If an application is filed underSec. 656.17, the notice must 
contain the information required for advertisements bySec. 656.17(f), 
must state the rate of pay (which must equal or exceed the prevailing 
wage entered by the SWA on the prevailing wage request form), and must 
contain the information required by paragraph (d)(3) of this section.
    (5) If an application is filed on behalf of a college and university 
teacher selected in a competitive selection and recruitment process, as 
provided bySec. 656.18, the notice must include the information 
required for advertisements bySec. 656.18(b)(3), and must include the 
information required by paragraph (d)(3) of this section.
    (6) If an application is filed under the Schedule A procedures at 
Sec.  656.15, or the procedures for sheepherders atSec. 656.16, the 
notice must contain a description of the job and rate of pay, and must 
meet the requirements of this section.
    (e)(1)(i) Submission of evidence. Any person may submit to the 
Certifying Officer documentary evidence bearing on an application for 
permanent alien labor certification filed under the basic labor 
certification process atSec. 656.17 or an application involving a 
college and university teacher selected in a competitive recruitment and 
selection process underSec. 656.18.

[[Page 788]]

    (ii) Documentary evidence submitted under paragraph (e)(1)(i) of 
this section may include information on available workers, information 
on wages and working conditions, and information on the employer's 
failure to meet the terms and conditions for the employment of alien 
workers and co-workers. The Certifying Officer must consider this 
information in making his or her determination.
    (2)(i) Any person may submit to the appropriate DHS office 
documentary evidence of fraud or willful misrepresentation in a Schedule 
A application filed underSec. 656.15 or a sheepherder application 
filed underSec. 656.16.
    (ii) Documentary evidence submitted under paragraph (e)(2) of this 
section is limited to information relating to possible fraud or willful 
misrepresentation. The DHS may consider this information underSec. 
656.31.
    (f) Retention of documents. Copies of applications for permanent 
employment certification filed with the Department of Labor and all 
supporting documentation must be retained by the employer for 5 years 
from the date of filing the Application for Permanent Employment 
Certification.

[69 FR 77386, Dec. 27, 2004, as amended at 71 FR 35523, June 21, 2006]



Sec.  656.11  Substitutions and modifications to applications.

    (a) Substitution or change to the identity of an alien beneficiary 
on any application for permanent labor certification, whether filed 
under this part or 20 CFR part 656 in effect prior to March 28, 2005, 
and on any resulting certification, is prohibited for any request to 
substitute submitted after July 16, 2007.
    (b) Requests for modifications to an application will not be 
accepted for applications submitted after July 16, 2007.

[72 FR 27944, May 17, 2007]



Sec.  656.12  Improper commerce and payment.

    The following provision applies to applications filed under both 
this part and 20 CFR part 656 in effect prior to March 28, 2005, and to 
any certification resulting from those applications:
    (a) Applications for permanent labor certification and approved 
labor certifications are not articles of commerce. They shall not be 
offered for sale, barter or purchase by individuals or entities. Any 
evidence that an application for permanent labor certification or an 
approved labor certification has been sold, bartered, or purchased shall 
be grounds for investigation under this part and may be grounds for 
denial underSec. 656.24, revocation underSec. 656.32, debarment 
underSec. 656.31(f), or any combination thereof.
    (b) An employer must not seek or receive payment of any kind for any 
activity related to obtaining permanent labor certification, including 
payment of the employer's attorneys' fees, whether as an incentive or 
inducement to filing, or as a reimbursement for costs incurred in 
preparing or filing a permanent labor certification application, except 
when work to be performed by the alien in connection with the job 
opportunity would benefit or accrue to the person or entity making the 
payment, based on that person's or entity's established business 
relationship with the employer. An alien may pay his or her own costs in 
connection with a labor certification, including attorneys' fees for 
representation of the alien, except that where the same attorney 
represents both the alien and the employer, such costs shall be borne by 
the employer. For purposes of this paragraph (b), payment includes, but 
is not limited to, monetary payments; wage concessions, including 
deductions from wages, salary, or benefits; kickbacks, bribes, or 
tributes; in kind payments; and free labor.
    (c) Evidence that an employer has sought or received payment from 
any source in connection with an application for permanent labor 
certification or an approved labor certification, except for a third 
party to whose benefit work to be performed in connection with the job 
opportunity would accrue, based on that person's or entity's established 
business relationship with the employer, shall be grounds for 
investigation under this part or any appropriate Government agency's 
procedures, and may be grounds for denial underSec. 656.32, revocation 
underSec. 656.32,

[[Page 789]]

debarment underSec. 656.31(f), or any combination thereof.

[72 FR 27945, May 17, 2007]



Sec.  656.15  Applications for labor certification for Schedule A 
occupations.

    (a) Filing application. An employer must apply for a labor 
certification for a Schedule A occupation by filing an application with 
the appropriate DHS office, and not with an ETA application processing 
center.
    (b) General documentation requirements. A Schedule A application 
must include:
    (1) An Application for Permanent Employment Certification form, 
which includes a prevailing wage determination in accordance with 
Sec.Sec. 656.40 and 656.41.
    (2) Evidence that notice of filing the Application for Permanent 
Employment Certification was provided to the bargaining representative 
or the employer's employees as prescribed inSec. 656.10(d).
    (c) Group I documentation. An employer seeking labor certification 
under Group I of Schedule A must file with DHS, as part of its labor 
certification application, documentary evidence of the following:
    (1) An employer seeking Schedule A labor certification for an alien 
to be employed as a physical therapist (Sec.  656.5(a)(1)) must file as 
part of its labor certification application a letter or statement, 
signed by an authorized state physical therapy licensing official in the 
state of intended employment, stating the alien is qualified to take 
that state's written licensing examination for physical therapists. 
Application for certification of permanent employment as a physical 
therapist may be made only under thisSec. 656.15 and not underSec. 
656.17.
    (2) An employer seeking a Schedule A labor certification for an 
alien to be employed as a professional nurse (Sec.  656.5(a)(2)) must 
file as part of its labor certification application documentation that 
the alien has received a Certificate from the Commission on Graduates of 
Foreign Nursing Schools (CGFNS); that the alien holds a full and 
unrestricted (permanent) license to practice nursing in the state of 
intended employment; or that the alien has passed the National Council 
Licensure Examination for Registered Nurses (NCLEX-RN). Application for 
certification of employment as a professional nurse may be made only 
under thisSec. 656.15(c) and not underSec. 656.17.
    (d) Group II documentation. An employer seeking a Schedule A labor 
certification under Group II of Schedule A must file with DHS, as part 
of its labor certification application, documentary evidence of the 
following:
    (1) An employer seeking labor certification on behalf of an alien to 
be employed as an alien of exceptional ability in the sciences or arts 
(excluding those in the performing arts) must file documentary evidence 
showing the widespread acclaim and international recognition accorded 
the alien by recognized experts in the alien's field; and documentation 
showing the alien's work in that field during the past year did, and the 
alien's intended work in the United States will, require exceptional 
ability. In addition, the employer must file documentation about the 
alien from at least two of the following seven groups:
    (i) Documentation of the alien's receipt of internationally 
recognized prizes or awards for excellence in the field for which 
certification is sought;
    (ii) Documentation of the alien's membership in international 
associations, in the field for which certification is sought, which 
require outstanding achievement of their members, as judged by 
recognized international experts in their disciplines or fields;
    (iii) Published material in professional publications about the 
alien, about the alien's work in the field for which certification is 
sought, which shall include the title, date, and author of such 
published material;
    (iv) Evidence of the alien's participation on a panel, or 
individually, as a judge of the work of others in the same or in an 
allied field of specialization to that for which certification is 
sought;
    (v) Evidence of the alien's original scientific or scholarly 
research contributions of major significance in the field for which 
certification is sought;
    (vi) Evidence of the alien's authorship of published scientific or 
scholarly

[[Page 790]]

articles in the field for which certification is sought, in 
international professional journals or professional journals with an 
international circulation;
    (vii) Evidence of the display of the alien's work, in the field for 
which certification is sought, at artistic exhibitions in more than one 
country.
    (2) An employer seeking labor certification on behalf of an alien of 
exceptional ability in the performing arts must file documentary 
evidence that the alien's work experience during the past twelve months 
did require, and the alien's intended work in the United States will 
require, exceptional ability; and must submit documentation to show this 
exceptional ability, such as:
    (i) Documentation attesting to the current widespread acclaim and 
international recognition accorded to the alien, and receipt of 
internationally recognized prizes or awards for excellence;
    (ii) Published material by or about the alien, such as critical 
reviews or articles in major newspapers, periodicals, and/or trade 
journals (the title, date, and author of such material shall be 
indicated);
    (iii) Documentary evidence of earnings commensurate with the claimed 
level of ability;
    (iv) Playbills and star billings;
    (v) Documents attesting to the outstanding reputation of theaters, 
concert halls, night clubs, and other establishments in which the alien 
has appeared or is scheduled to appear; and/or
    (vi) Documents attesting to the outstanding reputation of theaters 
or repertory companies, ballet troupes, orchestras, or other 
organizations in which or with which the alien has performed during the 
past year in a leading or starring capacity.
    (e) Determination. An Immigration Officer determines whether the 
employer and alien have met the applicable requirements ofSec. 656.10 
and of Schedule A (Sec.  656.5); reviews the application; and determines 
whether or not the alien is qualified for and intends to pursue the 
Schedule A occupation. The Schedule A determination of DHS is conclusive 
and final. The employer, therefore, may not appeal from any such 
determination under the review procedures atSec. 656.26.
    (f) Refiling after denial. If an application for a Schedule A 
occupation is denied, the employer, except where the occupation is as a 
physical therapist or a professional nurse, may at any time file for a 
labor certification on the alien beneficiary's behalf underSec. 
656.17. Labor certifications for professional nurses and for physical 
therapists shall not be considered underSec. 656.17.

[69 FR 77386, Dec. 27, 2004, as amended at 73 FR 78068, Dec. 19, 2008]



Sec.  656.16  Labor certification applications for sheepherders.

    (a) Filing requirements and required documentation. (1) An employer 
may apply for a labor certification to employ an alien (who has been 
employed legally as a nonimmigrant sheepherder in the United States for 
at least 33 of the preceding 36 months) as a sheepherder by filing an 
Application for Permanent Employment Certification form directly with 
DHS, not with an office of DOL.
    (2) A signed letter or letters from each U.S. employer who has 
employed the alien as a sheepherder during the immediately preceding 36 
months, attesting the alien has been employed in the United States 
lawfully and continuously as a sheepherder for at least 33 of the 
immediately preceding 36 months, must be filed with the application.
    (b) Determination. An Immigration Officer reviews the application 
and the letters attesting to the alien's previous employment as a 
sheepherder in the United States, and determines whether or not the 
alien and the employer(s) have met the requirements of this section.
    (1) The determination of the Immigration Officer under this 
paragraph (b) is conclusive and final. The employer(s) and the alien, 
therefore, may not make use of the review procedures set forth at 
Sec.Sec. 656.26 and 656.27 to appeal such a determination.
    (2) If the alien and the employer(s) have met the requirements of 
this section, the Immigration Officer must indicate on the Application 
for Permanent Employment Certification form the occupation, the 
immigration office that made the determination, and the date of the 
determination (seeSec. 656.30 for

[[Page 791]]

the significance of this date). The Immigration Officer must then 
promptly forward a copy of the Application for Permanent Employment 
Certification form, without attachments, to the Office of Foreign Labor 
Certification (OFLC) Administrator.
    (c) Alternative filing. If an application for a sheepherder does not 
meet the requirements of this section, the application may be filed 
underSec. 656.17.

[69 FR 77386, Dec. 27, 2004, as amended at 71 FR 35523, June 21, 2006]



Sec.  656.17  Basic labor certification process.

    (a) Filing applications. (1) Except as otherwise provided by 
Sec.Sec. 656.15, 656.16, and 656.18, an employer who desires to apply 
for a labor certification on behalf of an alien must file a completed 
Department of Labor Application for Permanent Employment Certification 
form (ETA Form 9089). The application must be filed with an ETA 
application processing center. Incomplete applications will be denied. 
Applications filed and certified electronically must, upon receipt of 
the labor certification, be signed immediately by the employer in order 
to be valid. Applications submitted by mail must contain the original 
signature of the employer, alien, attorney, and/or agent when they are 
received by the application processing center. DHS will not process 
petitions unless they are supported by an original certified ETA Form 
9089 that has been signed by the employer, alien, attorney and/or agent.
    (2) The Department of Labor may issue or require the use of certain 
identifying information, including user identifiers, passwords, or 
personal identification numbers (PINS). The purpose of these personal 
identifiers is to allow the Department of Labor to associate a given 
electronic submission with a single, specific individual. Personal 
identifiers can not be issued to a company or business. Rather, a 
personal identifier can only be issued to specific individual. Any 
personal identifiers must be used solely by the individual to whom they 
are assigned and can not be used or transferred to any other individual. 
An individual assigned a personal identifier must take all reasonable 
steps to ensure that his or her personal identifier can not be 
compromised. If an individual assigned a personal identifier suspects, 
or becomes aware, that his or her personal identifier has been 
compromised or is being used by someone else, then the individual must 
notify the Department of Labor immediately of the incident and cease the 
electronic transmission of any further submissions under that personal 
identifier until such time as a new personal identifier is provided. Any 
electronic transmissions submitted with a personal identifier will be 
presumed to be a submission by the individual assigned that personal 
identifier. The Department of Labor's system will notify those making 
submissions of these requirements at the time of each submission.
    (3) Documentation supporting the application for labor certification 
should not be filed with the application, however in the event the 
Certifying Officer notifies the employer that its application is to be 
audited, the employer must furnish required supporting documentation 
prior to a final determination.
    (b) Processing. (1) Applications are screened and are certified, are 
denied, or are selected for audit.
    (2) Employers will be notified if their applications have been 
selected for audit by the issuance of an audit letter underSec. 
656.20.
    (3) Applications may be selected for audit in accordance with 
selection criteria or may be randomly selected.
    (c) Filing date. Non-electronically filed applications accepted for 
processing shall be date stamped. Electronically filed applications will 
be considered filed when submitted.
    (d) Refiling procedures. (1) Employers that filed applications under 
the regulations in effect prior to March 28, 2005, may, if a job order 
has not been placed pursuant to those regulations, refile such 
applications under this part without loss of the original filing date 
by:
    (i) Submitting an application for an identical job opportunity after 
complying with all of the filing and recruiting requirements of this 
part 656; and
    (ii) Withdrawing the original application in accordance with ETA 
procedures. Filing an application under this

[[Page 792]]

part stating the employer's desire to use the original filing date will 
be deemed to be a withdrawal of the original application. The original 
application will be deemed withdrawn regardless of whether the 
employer's request to use the original filing date is approved.
    (2) Refilings under this paragraph must be made within 210 days of 
the withdrawal of the prior application.
    (3) A copy of the original application, including amendments, must 
be sent to the appropriate ETA application processing center when 
requested by the CO underSec. 656.20.
    (4) For purposes of paragraph (d)(1)(i) of this section, a job 
opportunity shall be considered identical if the employer, alien, job 
title, job location, job requirements, and job description are the same 
as those stated in the original application filed under the regulations 
in effect prior to March 28, 2005. For purposes of determining identical 
job opportunity, the original application includes all accepted 
amendments up to the time the application was withdrawn, including 
amendments in response to an assessment notice from a SWA pursuant to 
Sec.  656.21(h) of the regulations in effect prior to March 28, 2005.
    (e) Required pre-filing recruitment. Except for labor certification 
applications involving college or university teachers selected pursuant 
to a competitive recruitment and selection process (Sec.  656.18), 
Schedule A occupations (Sec.Sec. 656.5 and 656.15), and sheepherders 
(Sec.  656.16), an employer must attest to having conducted the 
following recruitment prior to filing the application:
    (1) Professional occupations. If the application is for a 
professional occupation, the employer must conduct the recruitment steps 
within 6 months of filing the application for alien employment 
certification. The employer must maintain documentation of the 
recruitment and be prepared to submit this documentation in the event of 
an audit or in response to a request from the Certifying Officer prior 
to rendering a final determination.
    (i) Mandatory steps. Two of the steps, a job order and two print 
advertisements, are mandatory for all applications involving 
professional occupations, except applications for college or university 
teachers selected in a competitive selection and recruitment process as 
provided inSec. 656.18. The mandatory recruitment steps must be 
conducted at least 30 days, but no more than 180 days, before the filing 
of the application.
    (A) Job order. Placement of a job order with the SWA serving the 
area of intended employment for a period of 30 days. The start and end 
dates of the job order entered on the application shall serve as 
documentation of this step.
    (B) Advertisements in newspaper or professional journals. (1) 
Placing an advertisement on two different Sundays in the newspaper of 
general circulation in the area of intended employment most appropriate 
to the occupation and the workers likely to apply for the job 
opportunity and most likely to bring responses from able, willing, 
qualified, and available U.S. workers.
    (2) If the job opportunity is located in a rural area of intended 
employment that does not have a newspaper with a Sunday edition, the 
employer may use the edition with the widest circulation in the area of 
intended employment.
    (3) The advertisements must satisfy the requirements of paragraph 
(f) of this section. Documentation of this step can be satisfied by 
furnishing copies of the newspaper pages in which the advertisements 
appeared or proof of publication furnished by the newspaper.
    (4) If the job involved in the application requires experience and 
an advanced degree, and a professional journal normally would be used to 
advertise the job opportunity, the employer may, in lieu of one of the 
Sunday advertisements, place an advertisement in the professional 
journal most likely to bring responses from able, willing, qualified, 
and available U.S. workers. Documentation of this step can be satisfied 
by providing a copy of the page in which the advertisement appeared.
    (ii) Additional recruitment steps. The employer must select three 
additional recruitment steps from the alternatives listed in paragraphs 
(e)(1)(ii)(A)-(J) of this section. Only one of the additional steps may 
consist

[[Page 793]]

solely of activity that took place within 30 days of the filing of the 
application. None of the steps may have taken place more than 180 days 
prior to filing the application.
    (A) Job fairs. Recruitment at job fairs for the occupation involved 
in the application, which can be documented by brochures advertising the 
fair and newspaper advertisements in which the employer is named as a 
participant in the job fair.
    (B) Employer's Web site. The use of the employer's Web site as a 
recruitment medium can be documented by providing dated copies of pages 
from the site that advertise the occupation involved in the application.
    (C) Job search Web site other than the employer's. The use of a job 
search Web site other than the employer's can be documented by providing 
dated copies of pages from one or more website(s) that advertise the 
occupation involved in the application. Copies of web pages generated in 
conjunction with the newspaper advertisements required by paragraph 
(e)(1)(i)(B) of this section can serve as documentation of the use of a 
Web site other than the employer's.
    (D) On-campus recruiting. The employer's on-campus recruiting can be 
documented by providing copies of the notification issued or posted by 
the college's or university's placement office naming the employer and 
the date it conducted interviews for employment in the occupation.
    (E) Trade or professional organizations. The use of professional or 
trade organizations as a recruitment source can be documented by 
providing copies of pages of newsletters or trade journals containing 
advertisements for the occupation involved in the application for alien 
employment certification.
    (F) Private employment firms. The use of private employment firms or 
placement agencies can be documented by providing documentation 
sufficient to demonstrate that recruitment has been conducted by a 
private firm for the occupation for which certification is sought. For 
example, documentation might consist of copies of contracts between the 
employer and the private employment firm and copies of advertisements 
placed by the private employment firm for the occupation involved in the 
application.
    (G) Employee referral program with incentives. The use of an 
employee referral program with incentives can be documented by providing 
dated copies of employer notices or memoranda advertising the program 
and specifying the incentives offered.
    (H) Campus placement offices. The use of a campus placement office 
can be documented by providing a copy of the employer's notice of the 
job opportunity provided to the campus placement office.
    (I) Local and ethnic newspapers. The use of local and ethnic 
newspapers can be documented by providing a copy of the page in the 
newspaper that contains the employer's advertisement.
    (J) Radio and television advertisements. The use of radio and 
television advertisements can be documented by providing a copy of the 
employer's text of the employer's advertisement along with a written 
confirmation from the radio or television station stating when the 
advertisement was aired.
    (2) Nonprofessional occupations. If the application is for a 
nonprofessional occupation, the employer must at a minimum, place a job 
order and two newspaper advertisements within 6 months of filing the 
application. The steps must be conducted at least 30 days but no more 
that 180 days before the filing of the application.
    (i) Job order. Placing a job order with the SWA serving the area of 
intended employment for a period of 30 days. The start and end dates of 
the job order entered on the application serve as documentation of this 
step.
    (ii) Newspaper advertisements. (A) Placing an advertisement on two 
different Sundays in the newspaper of general circulation in the area of 
intended employment most appropriate to the occupation and the workers 
likely to apply for the job opportunity.
    (B) If the job opportunity is located in a rural area of intended 
employment that does not have a newspaper that publishes a Sunday 
edition, the employer may use the newspaper edition with the widest 
circulation in the area of intended employment.
    (C) Placement of the newspaper advertisements can be documented in 
the

[[Page 794]]

same way as provided in paragraph (e)(1)(i)(B)(3) of this section for 
professional occupations.
    (D) The advertisements must satisfy the requirements of paragraph 
(f) of this section.
    (f) Advertising requirements. Advertisements placed in newspapers of 
general circulation or in professional journals before filing the 
Application for Permanent Employment Certification must:
    (1) Name the employer;
    (2) Direct applicants to report or send resumes, as appropriate for 
the occupation, to the employer;
    (3) Provide a description of the vacancy specific enough to apprise 
the U.S. workers of the job opportunity for which certification is 
sought;
    (4) Indicate the geographic area of employment with enough 
specificity to apprise applicants of any travel requirements and where 
applicants will likely have to reside to perform the job opportunity;
    (5) Not contain a wage rate lower than the prevailing wage rate;
    (6) Not contain any job requirements or duties which exceed the job 
requirements or duties listed on the ETA Form 9089; and
    (7) Not contain wages or terms and conditions of employment that are 
less favorable than those offered to the alien.
    (g) Recruitment report. (1) The employer must prepare a recruitment 
report signed by the employer or the employer's representative noted in 
Sec.  656.10(b)(2)(ii) describing the recruitment steps undertaken and 
the results achieved, the number of hires, and, if applicable, the 
number of U.S. workers rejected, categorized by the lawful job related 
reasons for such rejections. The Certifying Officer, after reviewing the 
employer's recruitment report, may request the U.S. workers' resumes or 
applications, sorted by the reasons the workers were rejected.
    (2) A U.S. worker is able and qualified for the job opportunity if 
the worker can acquire the skills necessary to perform the duties 
involved in the occupation during a reasonable period of on-the-job 
training. Rejecting U.S. workers for lacking skills necessary to perform 
the duties involved in the occupation, where the U.S. workers are 
capable of acquiring the skills during a reasonable period of on-the-job 
training is not a lawful job-related reason for rejection of the U.S. 
workers.
    (h) Job duties and requirements. (1) The job opportunity's 
requirements, unless adequately documented as arising from business 
necessity, must be those normally required for the occupation and must 
not exceed the Specific Vocational Preparation level assigned to the 
occupation as shown in the O*NET Job Zones. To establish a business 
necessity, an employer must demonstrate the job duties and requirements 
bear a reasonable relationship to the occupation in the context of the 
employer's business and are essential to perform the job in a reasonable 
manner.
    (2) A foreign language requirement can not be included, unless it is 
justified by business necessity. Demonstrating business necessity for a 
foreign language requirement may be based upon the following:
    (i) The nature of the occupation, e.g., translator; or
    (ii) The need to communicate with a large majority of the employer's 
customers, contractors, or employees who can not communicate effectively 
in English, as documented by:
    (A) The employer furnishing the number and proportion of its 
clients, contractors, or employees who can not communicate in English, 
and/or a detailed plan to market products or services in a foreign 
country; and
    (B) A detailed explanation of why the duties of the position for 
which certification is sought requires frequent contact and 
communication with customers, employees or contractors who can not 
communicate in English and why it is reasonable to believe the allegedly 
foreign-language-speaking customers, employees, and contractors can not 
communicate in English.
    (3) If the job opportunity involves a combination of occupations, 
the employer must document that it has normally employed persons for 
that combination of occupations, and/or workers customarily perform the 
combination of occupations in the area of intended employment, and/or 
the combination job opportunity is based on a business necessity. 
Combination occupations

[[Page 795]]

can be documented by position descriptions and relevant payroll records, 
and/or letters from other employers stating their workers normally 
perform the combination of occupations in the area of intended 
employment, and/or documentation that the combination occupation arises 
from a business necessity.
    (4)(i) Alternative experience requirements must be substantially 
equivalent to the primary requirements of the job opportunity for which 
certification is sought; and
    (ii) If the alien beneficiary already is employed by the employer, 
and the alien does not meet the primary job requirements and only 
potentially qualifies for the job by virtue of the employer's 
alternative requirements, certification will be denied unless the 
application states that any suitable combination of education, training, 
or experience is acceptable.
    (i) Actual minimum requirements. DOL will evaluate the employer's 
actual minimum requirements in accordance with this paragraph (i).
    (1) The job requirements, as described, must represent the 
employer's actual minimum requirements for the job opportunity.
    (2) The employer must not have hired workers with less training or 
experience for jobs substantially comparable to that involved in the job 
opportunity.
    (3) If the alien beneficiary already is employed by the employer, in 
considering whether the job requirements represent the employer's actual 
minimums, DOL will review the training and experience possessed by the 
alien beneficiary at the time of hiring by the employer, including as a 
contract employee. The employer can not require domestic worker 
applicants to possess training and/or experience beyond what the alien 
possessed at the time of hire unless:
    (i) The alien gained the experience while working for the employer, 
including as a contract employee, in a position not substantially 
comparable to the position for which certification is being sought, or
    (ii) The employer can demonstrate that it is no longer feasible to 
train a worker to qualify for the position.
    (4) In evaluating whether the alien beneficiary satisfies the 
employer's actual minimum requirements, DOL will not consider any 
education or training obtained by the alien beneficiary at the 
employer's expense unless the employer offers similar training to 
domestic worker applicants.
    (5) For purposes of this paragraph (i):
    (i) The term ``employer'' means an entity with the same Federal 
Employer Identification Number (FEIN), provided it meets the definition 
of an employer atSec. 656.3.
    (ii) A ``substantially comparable'' job or position means a job or 
position requiring performance of the same job duties more than 50 
percent of the time. This requirement can be documented by furnishing 
position descriptions, the percentage of time spent on the various 
duties, organization charts, and payroll records.
    (j) Conditions of employment. (1) Working conditions must be normal 
to the occupation in the area and industry.
    (2) Live-in requirements are acceptable for household domestic 
service workers only if the employer can demonstrate the requirement is 
essential to perform, in a reasonable manner, the job duties as 
described by the employer and there are not cost-effective alternatives 
to a live-in household requirement. Mere employer assertions do not 
constitute acceptable documentation. For example, a live-in requirement 
could be supported by documenting two working parents and young children 
in the household, and/or the existence of erratic work schedules 
requiring frequent travel and a need to entertain business associates 
and clients on short notice. Depending upon the situation, acceptable 
documentation could consist of travel vouchers, written estimates of 
costs of alternatives such as babysitters, or a detailed listing of the 
frequency and length of absences of the employer from the home.
    (k) Layoffs. (1) If there has been a layoff by the employer 
applicant in the area of intended employment within 6 months of filing 
an application involving the occupation for which certification is 
sought or in a related occupation, the employer must document it

[[Page 796]]

has notified and considered all potentially qualified laid off (employer 
applicant) U.S. workers of the job opportunity involved in the 
application and the results of the notification and consideration. A 
layoff shall be considered any involuntary separation of one or more 
employees without cause or prejudice.
    (2) For the purposes of paragraph (k)(1) of this section, a related 
occupation is any occupation that requires workers to perform a majority 
of the essential duties involved in the occupation for which 
certification is sought.
    (l) Alien influence and control over job opportunity. If the 
employer is a closely held corporation or partnership in which the alien 
has an ownership interest, or if there is a familial relationship 
between the stockholders, corporate officers, incorporators, or 
partners, and the alien, or if the alien is one of a small number of 
employees, the employer in the event of an audit must be able to 
demonstrate the existence of a bona fide job opportunity, i.e., the job 
is available to all U.S. workers, and must provide to the Certifying 
Officer, the following supporting documentation:
    (1) A copy of the articles of incorporation, partnership agreement, 
business license or similar documents that establish the business 
entity;
    (2) A list of all corporate/company officers and shareholders/
partners of the corporation/firm/business, their titles and positions in 
the business' structure, and a description of the relationships to each 
other and to the alien beneficiary;
    (3) The financial history of the corporation/company/partnership, 
including the total investment in the business entity and the amount of 
investment of each officer, incorporator/partner and the alien 
beneficiary; and
    (4) The name of the business' official with primary responsibility 
for interviewing and hiring applicants for positions within the 
organization and the name(s) of the business' official(s) having control 
or influence over hiring decisions involving the position for which 
labor certification is sought.
    (5) If the alien is one of 10 or fewer employees, the employer must 
document any family relationship between the employees and the alien.



Sec.  656.18  Optional special recruitment and documentation 
procedures for college and university teachers.

    (a) Filing requirements. Applications for certification of 
employment of college and university teachers must be filed by 
submitting a completed Application for Permanent Employment 
Certification form to the appropriate ETA application processing center.
    (b) Recruitment. The employer may recruit for college and university 
teachers underSec. 656.17 or must be able to document the alien was 
selected for the job opportunity in a competitive recruitment and 
selection process through which the alien was found to be more qualified 
than any of the United States workers who applied for the job. For 
purposes of this paragraph (b), documentation of the ``competitive 
recruitment and selection process'' must include:
    (1) A statement, signed by an official who has actual hiring 
authority from the employer outlining in detail the complete recruitment 
procedures undertaken; and which must set forth:
    (i) The total number of applicants for the job opportunity;
    (ii) The specific lawful job-related reasons why the alien is more 
qualified than each U.S. worker who applied for the job; and
    (2) A final report of the faculty, student, and/or administrative 
body making the recommendation or selection of the alien, at the 
completion of the competitive recruitment and selection process;
    (3) A copy of at least one advertisement for the job opportunity 
placed in a national professional journal, giving the name and the 
date(s) of publication; and which states the job title, duties, and 
requirements;
    (4) Evidence of all other recruitment sources utilized; and
    (5) A written statement attesting to the degree of the alien's 
educational or professional qualifications and academic achievements.
    (c) Time limit for filing. Applications for permanent alien labor 
certification for job opportunities as college and

[[Page 797]]

university teachers must be filed within 18 months after a selection is 
made pursuant to a competitive recruitment and selection process.
    (d) Alternative procedure. An employer that can not or does not 
choose to satisfy the special recruitment procedures for a college or 
university teacher under this section may avail itself of the basic 
process atSec. 656.17. An employer that files for certification of 
employment of college and university teachers underSec. 656.17 or this 
section must be able to document, if requested by the Certifying 
Officer, in accordance withSec. 656.24(a)(2)(ii), the alien was found 
to be more qualified than each U.S. worker who applied for the job 
opportunity.



Sec.  656.19  Live-in household domestic service workers.

    (a) Processing. Applications on behalf of live-in household domestic 
service occupations are processed pursuant to the requirements of the 
basic process atSec. 656.17.
    (b) Required documentation. Employers filing applications on behalf 
of live-in household domestic service workers must provide, in event of 
an audit, the following documentation:
    (1) A statement describing the household living accommodations, 
including the following:
    (i) Whether the residence is a house or apartment;
    (ii) The number of rooms in the residence;
    (iii) The number of adults and children, and ages of the children, 
residing in the household; and
    (iv) That free board and a private room not shared with any other 
person will be provided to the alien.
    (2) Two copies of the employment contract, each signed and dated 
prior to the filing of the application by both the employer and the 
alien (not by their attorneys or agents). The contract must clearly 
state:
    (i) The wages to be paid on an hourly and weekly basis;
    (ii) Total hours of employment per week, and exact hours of daily 
employment;
    (iii) That the alien is free to leave the employer's premises during 
all non-work hours except the alien may work overtime if paid for the 
overtime at no less than the legally required hourly rate;
    (iv) That the alien will reside on the employer's premises;
    (v) Complete details of the duties to be performed by the alien;
    (vi) The total amount of any money to be advanced by the employer 
with details of specific items, and the terms of repayment by the alien 
of any such advance by the employer;
    (vii) That in no event may the alien be required to give more than 
two weeks' notice of intent to leave the employment contracted for and 
the employer must give the alien at least two weeks' notice before 
terminating employment;
    (viii) That a duplicate contract has been furnished to the alien;
    (ix) That a private room and board will be provided at no cost to 
the worker; and
    (x) Any other agreement or conditions not specified on the 
Application for Permanent Employment Certification form.
    (3) Documentation of the alien's paid experience in the form of 
statements from past or present employers setting forth the dates (month 
and year) employment started and ended, hours of work per day, number of 
days worked per week, place where the alien worked, detailed statement 
of duties performed on the job, equipment and appliances used, and the 
amount of wages paid per week or month. The total paid experience must 
be equal to one full year's employment on a full-time basis. For 
example, two year's experience working half-days is the equivalent of 
one year's full time experience. Time spent in a household domestic 
service training course can not be included in the required one year of 
paid experience. Each statement must contain the name and address of the 
person who signed it and show the date on which the statement was 
signed. A statement not in English shall be accompanied by a written 
translation into English certified by the translator as to the accuracy 
of the translation, and as to the translator's competency to translate.

[[Page 798]]



Sec.  656.20  Audit procedures.

    (a) Review of the labor certification application may lead to an 
audit of the application. Additionally, certain applications may be 
selected randomly for audit and quality control purposes. If an 
application is selected for audit, the Certifying Officer shall issue an 
audit letter. The audit letter will:
    (1) State the documentation that must be submitted by the employer;
    (2) Specify a date, 30 days from the date of the audit letter, by 
which the required documentation must be submitted; and
    (3) Advise that if the required documentation has not been sent by 
the date specified the application will be denied.
    (i) Failure to provide documentation in a timely manner constitutes 
a refusal to exhaust available administrative remedies; and
    (ii) The administrative-judicial review procedure provided inSec. 
656.26 is not available.
    (b) A substantial failure by the employer to provide required 
documentation will result in that application being denied underSec. 
656.24 and may result in a determination by the Certifying Officer 
pursuant toSec. 656.24 to require the employer to conduct supervised 
recruitment underSec. 656.21 in future filings of labor certification 
applications for up to 2 years.
    (c) The Certifying Officer may in his or her discretion provide one 
extension, of up to 30 days, to the 30 days specified in paragraph 
(a)(2) of this section.
    (d) Before making a final determination in accordance with the 
standards inSec. 656.24, whether in course of an audit or otherwise, 
the Certifying Officer may:
    (1) Request supplemental information and/or documentation; or
    (2) Require the employer to conduct supervised recruitment under 
Sec.  656.21.

[69 FR 77386, Dec. 27, 2004, as amended at 71 FR 35523, June 21, 2006]



Sec.  656.21  Supervised recruitment.

    (a) Supervised recruitment. Where the Certifying Officer determines 
it appropriate, post-filing supervised recruitment may be required of 
the employer for the pending application or future applications pursuant 
toSec. 656.20(b).
    (b) Requirements. Supervised recruitment shall consist of 
advertising for the job opportunity by placing an advertisement in a 
newspaper of general circulation or in a professional, trade, or ethnic 
publication, and any other measures required by the CO. If placed in a 
newspaper of general circulation, the advertisement must be published 
for 3 consecutive days, one of which must be a Sunday; or, if placed in 
a professional, trade, or ethnic publication, the advertisement must be 
published in the next available published edition. The advertisement 
must be approved by the Certifying Officer before publication, and the 
CO will direct where the advertisement is to be placed.
    (1) The employer must supply a draft advertisement to the CO for 
review and approval within 30 days of being notified that supervised 
recruitment is required.
    (2) The advertisement must:
    (i) Direct applicants to send resumes or applications for the job 
opportunity to the CO for referral to the employer;
    (ii) Include an identification number and an address designated by 
the Certifying Officer;
    (iii) Describe the job opportunity;
    (iv) Not contain a wage rate lower than the prevailing wage rate;
    (v) Summarize the employer's minimum job requirements, which can not 
exceed any of the requirements entered on the application form by the 
employer;
    (vi) Offer training if the job opportunity is the type for which 
employers normally provide training; and
    (vii) Offer wages, terms and conditions of employment no less 
favorable than those offered to the alien.
    (c) Timing of advertisement. (1) The advertisement shall be placed 
in accordance with the guidance provided by the CO.
    (2) The employer will notify the CO when the advertisement will be 
placed.
    (d) Additional or substitute recruitment. The Certifying Officer may 
designate other appropriate sources of workers from which the employer 
must recruit

[[Page 799]]

for U.S. workers in addition to the advertising described in paragraph 
(b) of this section.
    (e) Recruitment report. The employer must provide to the Certifying 
Officer a signed, detailed written report of the employer's supervised 
recruitment, signed by the employer or the employer's representative 
described inSec. 656.10(b)(2)(ii), within 30 days of the Certifying 
Officer's request for such a report. The recruitment report must:
    (1) Identify each recruitment source by name and document that each 
recruitment source named was contacted. This can include, for example, 
copies of letters to recruitment sources such as unions, trade 
associations, colleges and universities and any responses received to 
the employer's inquiries. Advertisements placed in newspapers, 
professional, trade, or ethnic publications can be documented by 
furnishing copies of the tear sheets of the pages of the publication in 
which the advertisements appeared, proof of publication furnished by the 
publication, or dated copies of the web pages if the advertisement 
appeared on the web as well as in the publication in which the 
advertisement appeared.
    (2) State the number of U.S. workers who responded to the employer's 
recruitment.
    (3) State the names, addresses, and provide resumes (other than 
those sent to the employer by the CO) of the U.S. workers who applied 
for the job opportunity, the number of workers interviewed, and the job 
title of the person who interviewed the workers.
    (4) Explain, with specificity, the lawful job-related reason(s) for 
not hiring each U.S. worker who applied. Rejection of one or more U.S. 
workers for lacking skills necessary to perform the duties involved in 
the occupation, where the U.S. workers are capable of acquiring the 
skills during a reasonable period of on-the-job training, is not a 
lawful job-related reason for rejecting the U.S. workers. For the 
purpose of this paragraph (e)(4), a U.S. worker is able and qualified 
for the job opportunity if the worker can acquire the skills necessary 
to perform the duties involved in the occupation during a reasonable 
period of on-the-job training.
    (f) The employer shall supply the CO with the required documentation 
or information within 30 days of the date of the request. If the 
employer does not do so, the CO shall deny the application.
    (g) The Certifying Officer in his or her discretion, for good cause 
shown, may provide one extension to any request for documentation or 
information.



Sec.  656.24  Labor certification determinations.

    (a)(1) The Office of Foreign Labor Certification Administrator (OFLC 
Administrator) is the National Certifying Officer. The OFLC 
Administrator and the certifying officers in the ETA application 
processing centers have the authority to certify or deny labor 
certification applications.
    (2) If the labor certification presents a special or unique problem, 
the Director of an ETA application processing center may refer the 
matter to the Office of Foreign Labor Certification Administrator (OFLC 
Administrator). If the OFLC Administrator has directed that certain 
types of applications or specific applications be handled in the ETA 
national office, the Directors of the ETA application processing centers 
shall refer such applications to the OFLC Administrator.
    (b) The Certifying Officer makes a determination either to grant or 
deny the labor certification on the basis of whether or not:
    (1) The employer has met the requirements of this part.
    (2) There is in the United States a worker who is able, willing, 
qualified, and available for and at the place of the job opportunity.
    (i) The Certifying Officer must consider a U.S. worker able and 
qualified for the job opportunity if the worker, by education, training, 
experience, or a combination thereof, is able to perform in the normally 
accepted manner the duties involved in the occupation as customarily 
performed by other U.S. workers similarly employed. For the purposes of 
this paragraph (b)(2)(i), a U.S. worker is able and qualified for the 
job opportunity if the worker can acquire the skills necessary to 
perform the duties involved in the occupation

[[Page 800]]

during a reasonable period of on-the-job training.
    (ii) If the job involves a job opportunity as a college or 
university teacher, the U.S. worker must be at least as qualified as the 
alien.
    (3) The employment of the alien will not have an adverse effect upon 
the wages and working conditions of U.S. workers similarly employed. In 
making this determination, the Certifying Officer considers such things 
as: labor market information, the special circumstances of the industry, 
organization, and/or occupation, the prevailing wage in the area of 
intended employment, and prevailing working conditions, such as hours, 
in the occupation.
    (c) The Certifying Officer shall notify the employer in writing 
(either electronically or by mail) of the labor certification 
determination.
    (d) If a labor certification is granted, except for a labor 
certification for an occupation on Schedule A (Sec.  656.5) or for 
employment as a sheepherder underSec. 656.16, the Certifying Officer 
must send the certified application and complete Final Determination 
form to the employer, or, if appropriate, to the employer's agent or 
attorney, indicating the employer may file all the documents with the 
appropriate DHS office.
    (e) If the labor certification is denied, the Final Determination 
form will:
    (1) State the reasons for the determination;
    (2) Quote the request for review procedures atSec. 656.26 (a) and 
(b);
    (3) Advise that failure to request review within 30 days of the date 
of the determination, as specified inSec. 656.26(a), constitutes a 
failure to exhaust administrative remedies;
    (4) Advise that, if a request for review is not made within 30 days 
of the date of the determination, the denial shall become the final 
determination of the Secretary;
    (5) Advise that if an application for a labor certification is 
denied, and a request for review is not made in accordance with the 
procedures atSec. 656.26(a) and (b), a new application may be filed at 
any time; and
    (6) Advise that a new application in the same occupation for the 
same alien can not be filed while a request for review is pending with 
the Board of Alien Labor Certification Appeals.
    (f) If the Certifying Officer determines the employer substantially 
failed to produce required documentation, or the documentation was 
inadequate, or determines a material misrepresentation was made with 
respect to the application, or if the Certifying Officer determines it 
is appropriate for other reasons, the employer may be required to 
conduct supervised recruitment pursuant toSec. 656.21 in future 
filings of labor certification applications for up to two years from the 
date of the Final Determination.
    (g)(1) The employer may request reconsideration within 30 days from 
the date of issuance of the denial.
    (2) For applications submitted after July 16, 2007, a request for 
reconsideration may include only:
    (i) Documentation that the Department actually received from the 
employer in response to a request from the Certifying Officer to the 
employer; or
    (ii) Documentation that the employer did not have an opportunity to 
present previously to the Certifying Officer, but that existed at the 
time the Application for Permanent Labor Certification was filed, and 
was maintained by the employer to support the application for permanent 
labor certification in compliance with the requirements ofSec. 
656.10(f).
    (3) Paragraphs (g)(1) and (2) of this section notwithstanding, the 
Certifying Officer will not grant any request for reconsideration where 
the deficiency that caused denial resulted from the applicant's 
disregard of a system prompt or other direct instruction.
    (4) The Certifying Officer may, in his or her discretion, reconsider 
the determination or treat it as a request for review underSec. 
656.26(a).

[69 FR 77386, Dec. 27, 2004, as amended at 71 FR 35523, June 21, 2006; 
72 FR 27945, May 17, 2007]



Sec.  656.26  Board of Alien Labor Certification Appeals review of 
denials of labor certification.

    (a) Request for review. (1) If a labor certification is denied, if a 
labor certification is revoked pursuant toSec. 656.32, or if a 
debarment is issued

[[Page 801]]

underSec. 656.31(f), a request for review of the denial, revocation, 
or debarment may be made to the Board of Alien Labor Certification 
Appeals by the employer or debarred person or entity by making a request 
for such an administrative review in accordance with the procedures 
provided in paragraph (a) of this section. In the case of a finding of 
debarment, receipt by the Department of a request for review, if made in 
accordance with this section, shall stay the debarment until such time 
as the review has been completed and a decision rendered thereon.
    (2) A request for review of a denial or revocation:
    (i) Must be sent within 30 days of the date of the determination to 
the Certifying Officer who denied the application or revoked the 
certification;
    (ii) Must clearly identify the particular labor certification 
determination for which review is sought;
    (iii) Must set forth the particular grounds for the request; and
    (iv) Must include a copy of the Final Determination.
    (3) A request for review of debarment:
    (i) Must be sent to the Administrator, Office of Foreign Labor 
Certification, within 30 days of the date of the debarment 
determination;
    (ii) Must clearly identify the particular debarment determination 
for which review is sought;
    (iii) Must set forth the particular grounds for the request; and
    (iv) Must include a copy of the Notice of Debarment.
    (4)(i) With respect to a denial of the request for review, 
statements, briefs, and other submissions of the parties and amicus 
curiae must contain only legal argument and only such evidence that was 
within the record upon which the denial of labor certification was 
based.
    (ii) With respect to a revocation or a debarment determination, the 
BALCA proceeding may be de novo.
    (b) Upon the receipt of a request for review, the Certifying Officer 
immediately must assemble an indexed Appeal File:
    (1) The Appeal File must be in chronological order, must have the 
index on top followed by the most recent document, and must have 
consecutively numbered pages. The Appeal File must contain the request 
for review, the complete application file, and copies of all the written 
material, such as pertinent parts and pages of surveys and/or reports 
upon which the denial was based.
    (2) The Certifying Officer must send the Appeal File to the Board of 
Alien Labor Certification Appeals, Office of Administrative Law Judges, 
800 K Street, NW., Suite 400-N, Washington, DC 20001-8002.
    (3) The Certifying Officer must send a copy of the Appeal File to 
the employer. The employer may furnish or suggest directly to the Board 
of Alien Labor Certification Appeals the addition of any documentation 
that is not in the Appeal File, but that was submitted to DOL before the 
issuance of the Final Determination. The employer must submit such 
documentation in writing, and must send a copy to the Associate 
Solicitor for Employment and Training Legal Services, Office of the 
Solicitor, U.S. Department of Labor, Washington, DC 20210.
    (c) Debarment Appeal File. Upon the receipt of a request for review 
of debarment, the Administrator, Office of Foreign Labor Certification, 
immediately must assemble an indexed Appeal File:
    (1) The Appeal File must be in chronological order, must have the 
index on top followed by the most recent document, and must have 
consecutively numbered pages. The Appeal File must contain the request 
for review, the complete application file(s), and copies of all written 
materials, such as pertinent parts and pages of surveys and/or reports 
or documents received from any court, DHS, or the Department of State, 
upon which the debarment was based.
    (2) The Administrator, Office of Foreign Labor Certification, must 
send the Appeal File to the Board of Alien Labor Certification Appeals, 
Office of Administrative Law Judges, 800 K St., NW., Suite 400-N, 
Washington, DC 20001-8002.
    (3) The Administrator, Office of Foreign Labor Certification, must 
send a copy of the Appeal File to the debarred person or entity. The 
debarred person

[[Page 802]]

or entity may furnish or suggest directly to the Board of Alien Labor 
Certification Appeals the addition of any documentation that is not in 
the Appeal File. The debarred person or entity must submit such 
documentation in writing, and must send a copy to the Associate 
Solicitor for Employment and Training Legal Services, Office of the 
Solicitor, U.S. Department of Labor, 200 Constitution Ave., NW., 
Washington, DC 20210.

[69 FR 77386, Dec. 27, 2004, as amended at 72 FR 27945, May 17, 2007]



Sec.  656.27  Consideration by and decisions of the Board of Alien 
Labor Certification Appeals.

    (a) Panel designations. In considering requests for review before 
it, the Board of Alien Labor Certification Appeals may sit in panels of 
three members. The Chief Administrative Law Judge may designate any 
Board of Alien Labor Certification Appeals member to submit proposed 
findings and recommendations to the Board of Alien Labor Certification 
Appeals or to any duly designated panel thereof to consider a particular 
case.
    (b) Briefs and Statements of Position. In considering the requests 
for review before it, the Board of Alien Labor Certification Appeals 
must afford all parties 30 days to submit or decline to submit any 
appropriate Statement of Position or legal brief. The Certifying Officer 
is to be represented solely by the Solicitor of Labor or the Solicitor's 
designated representative.
    (c) Review on the record. The Board of Alien Labor Certification 
Appeals must review a denial of labor certification underSec. 656.24, 
a revocation of a certification underSec. 656.32, or an affirmation of 
a prevailing wage determination underSec. 656.41 on the basis of the 
record upon which the decision was made, the request for review, and any 
Statements of Position or legal briefs submitted and must:
    (1) Affirm the denial of the labor certification, the revocation of 
certification, or the affirmation of the PWD; or
    (2) Direct the Certifying Officer to grant the certification, 
overrule the revocation of certification, or overrule the affirmation of 
the PWD; or
    (3) Direct that a hearing on the case be held under paragraph (e) of 
this section.
    (d) Notifications of decisions. The Board of Alien Labor 
Certification Appeals must notify the employer, the Certifying Officer, 
and the Solicitor of Labor of its decision, and must return the record 
to the Certifying Officer unless the case has been set for hearing under 
paragraph (e) of this section.
    (e) Hearings--(1) Notification of hearing. If the case has been set 
for a hearing, the Board of Alien Labor Certification Appeals must 
notify the employer, the alien, the Certifying Officer, and the 
Solicitor of Labor of the date, time, and place of the hearing, and that 
the hearing may be rescheduled upon written request and for good cause 
shown.
    (2) Hearing procedure. (i) The ``Rules of Practice and Procedure For 
Administrative Hearings Before the Office of Administrative Law 
Judges,'' at 29 CFR part 18, apply to hearings under this paragraph (e).
    (ii) For the purposes of this paragraph (e)(2), references in 29 CFR 
part 18 to: ``administrative law judge'' mean the Board of Alien Labor 
Certification Appeals member or the Board of Alien Labor Certification 
Appeals panel duly designated underSec. 656.27(a); ``Office of 
Administrative Law Judges'' means the Board of Alien Labor Certification 
Appeals; and ``Chief Administrative Law Judge'' means the Chief 
Administrative Law Judge in that official's function of chairing the 
Board of Alien Labor Certification Appeals.



Sec.  656.30  Validity of and invalidation of labor certifications.

    (a) Priority date. (1) The filing date for a Schedule A occupation 
or sheepherders is the date the application was dated by the Immigration 
Officer.
    (2) The filing date, established underSec. 656.17(c), of an 
approved labor certification may be used as a priority date by the 
Department of Homeland Security and the Department of State, as 
appropriate.
    (b) Expiration of labor certifications. For certifications resulting 
from applications filed under this part and 20 CFR part 656 in effect 
prior to March 28, 2005, the following applies:

[[Page 803]]

    (1) An approved permanent labor certification granted on or after 
July 16, 2007 expires if not filed in support of a Form I-140 petition 
with the Department of Homeland Security within 180 calendar days of the 
date the Department of Labor granted the certification.
    (2) An approved permanent labor certification granted before July 
16, 2007 expires if not filed in support of a Form I-140 petition with 
the Department of Homeland Security within 180 calendar days of July 16, 
2007.
    (c) Scope of validity. For certifications resulting from 
applications filed under this part or 20 CFR part 656 in effect prior to 
March 28, 2005, the following applies:
    (1) A permanent labor certification for a Schedule A occupation or 
sheepherders is valid only for the occupation set forth on the 
Application for Alien Employment Certification (Form ETA 750) or the 
Application for Permanent Employment Certification (Form ETA 9089) and 
only for the alien named on the original application, unless a 
substitution was approved prior to July 16, 2007. The certification is 
valid throughout the United States unless the certification contains a 
geographic limitation.
    (2) A permanent labor certification involving a specific job offer 
is valid only for the particular job opportunity, the alien named on the 
original application (unless a substitution was approved prior to July 
16, 2007), and the area of intended employment stated on the Application 
for Alien Employment Certification (Form ETA 750) or the Application for 
Permanent Employment Certification (Form ETA 9089).
    (d) Invalidation of labor certifications. After issuance, a labor 
certification may be revoked by ETA using the procedures described in 
Sec.  656.32. Additionally, after issuance, a labor certification is 
subject to invalidation by the DHS or by a Consul of the Department of 
State upon a determination, made in accordance with those agencies' 
procedures or by a court, of fraud or willful misrepresentation of a 
material fact involving the labor certification application. If evidence 
of such fraud or willful misrepresentation becomes known to the CO or to 
the Chief, Division of Foreign Labor Certification, the CO, or the Chief 
of the Division of Foreign Labor Certification, as appropriate, shall 
notify in writing the DHS or Department of State, as appropriate. A copy 
of the notification must be sent to the regional or national office, as 
appropriate, of the Department of Labor's Office of Inspector General.
    (e) Duplicate labor certifications. (1) The Certifying Officer shall 
issue a duplicate labor certification at the written request of a 
Consular or Immigration Officer. The Certifying Officer shall issue such 
duplicate labor certifications only to the Consular or Immigration 
Officer who initiated the request.
    (2) The Certifying Officer shall issue a duplicate labor 
certification to a Consular or Immigration Officer at the written 
request of an alien, employer, or an alien's or employer's attorney/
agent. Such request for a duplicate labor certification must be 
addressed to the Certifying Officer who issued the labor certification; 
must include documentary evidence from a Consular or Immigration Officer 
that a visa application or visa petition, as appropriate, has been 
filed; and must include a Consular Office or DHS tracking number.
    (3) A duplicate labor certification shall be issued by the 
Certifying Officer with the same filing and expiration dates, as 
described in paragraphs (a) and (b) of this section, as the original 
approved labor certification.

[69 FR 77386, Dec. 27, 2004, as amended at 72 FR 27946, May 17, 2007]



Sec.  656.31  Labor certification applications involving fraud, 
willful misrepresentation, or violations of this part.

    The following provisions apply to applications filed under both this 
part and 20 CFR part 656 in effect prior to March 28, 2005, and to any 
certifications resulting from those applications.
    (a) Denial. A Certifying Officer may deny any application for 
permanent labor certification if the officer finds the application 
contains false statements, is fraudulent, or was otherwise submitted in 
violation of the Department's permanent labor certification regulations.

[[Page 804]]

    (b) Possible fraud or willful misrepresentation. (1) If the 
Department learns an employer, attorney, or agent is involved in 
possible fraud or willful misrepresentation in connection with the 
permanent labor certification program, the Department will refer the 
matter to the Department of Justice, Department of Homeland Security, or 
other government entity, as appropriate, for investigation, and send a 
copy of the referral to the Department of Labor's Office of Inspector 
General (OIG). In these cases, or if the Department learns an employer, 
attorney, or agent is under investigation by the Department of Justice, 
Department of Homeland Security, or other government entity for possible 
fraud or willful misrepresentation in connection with the permanent 
labor certification program, the Department may suspend processing of 
any permanent labor certification application involving such employer, 
attorney, or agent until completion of any investigation and/or judicial 
proceedings. Unless the investigatory agency, in writing, requests the 
Department to do otherwise, the Department shall provide written 
notification to the employer of the suspension in processing.
    (2) A suspension pursuant to paragraph (b)(1) of this section may 
last initially for up to 180 days. No later than 180 days after the 
suspension began, if no criminal indictment or information has been 
issued, or judicial proceedings have not been concluded, the National 
Certifying Officer may resume processing some or all of the 
applications, or may extend the suspension in processing until 
completion of any investigation and/or judicial proceedings.
    (c) Criminal indictment or information. If the Department learns 
that an employer, attorney, or agent is named in a criminal indictment 
or information in connection with the permanent labor certification 
program, the processing of applications related to that employer, 
attorney, or agent may be suspended until the judicial process is 
completed. Unless the investigatory or prosecutorial agency, in writing, 
requests the Department to do otherwise, the Department shall provide 
written notification to the employer of the suspension in processing.
    (d) No finding of fraud or willful misrepresentation. If an 
employer, attorney, or agent is acquitted of fraud or willful 
misrepresentation charges, or if such criminal charges are withdrawn or 
otherwise fail to result in a finding of fraud or willful 
misrepresentation, the Certifying Officer shall decide each pending 
permanent labor certification application related to that employer, 
attorney, or agent on the merits of the application.
    (e) Finding of fraud or willful misrepresentation. If an employer, 
attorney, or agent is found to have committed fraud or willful 
misrepresentation involving the permanent labor certification program, 
whether by a court, the Department of State or DHS, as referenced in 
Sec.  656.30(d), or through other proceedings:
    (1) Any suspension of processing of pending applications related to 
that employer, attorney, or agent will terminate.
    (2) The Certifying Officer will decide each such application on its 
merits, and may deny any such application as provided inSec. 656.24 
and in paragraph (a) of this section.
    (3) In the case of a pending application involving an attorney or 
agent found to have committed fraud or willful misrepresentation, DOL 
will notify the employer associated with that application of the finding 
and require the employer to notify DOL in writing, within 30 days of the 
notification, whether the employer will withdraw the application, 
designate a new attorney or agent, or continue the application without 
representation. Failure of the employer to respond within 30 days of the 
notification will result in a denial. If the employer elects to continue 
representation by the attorney or agent, DOL will suspend processing of 
affected applications while debarment proceedings are conducted under 
paragraph (f) of this section.
    (f) Debarment. (1) No later than six years after the date of filing 
of the labor certification application that is the basis for the 
finding, or, if such basis requires a pattern or practice as provided in 
paragraphs (f)(1)(iii), (iv), and (v) of this section, no later than six

[[Page 805]]

years after the date of filing of the last labor certification 
application which constitutes a part of the pattern or practice, the 
Administrator, Office of Foreign Labor Certification, may issue to an 
employer, attorney, agent, or any combination thereof a Notice of 
Debarment from the permanent labor certification program for a 
reasonable period of no more than three years, based upon any action 
that was prohibited at the time the action occurred, upon determining 
the employer, attorney, or agent has participated in or facilitated one 
or more of the following:
    (i) The sale, barter, or purchase of permanent labor applications or 
certifications, or any other action prohibited underSec. 656.12;
    (ii) The willful provision or willful assistance in the provision of 
false or inaccurate information in applying for permanent labor 
certification;
    (iii) A pattern or practice of a failure to comply with the terms of 
the Form ETA 9089 or Form ETA 750;
    (iv) A pattern or practice of failure to comply in the audit process 
pursuant toSec. 656.20;
    (v) A pattern or practice of failure to comply in the supervised 
recruitment process pursuant toSec. 656.21; or
    (vi) Conduct resulting in a determination by a court, DHS or the 
Department of State of fraud or willful misrepresentation involving a 
permanent labor certification application, as referenced inSec. 
656.31(e).
    (2) The Notice of Debarment shall be in writing; shall state the 
reason for the debarment finding, including a detailed explanation of 
how the employer, attorney or agent has participated in or facilitated 
one or more of the actions listed in paragraphs (f)(1)(i) through (v) of 
this section; shall state the start date and term of the debarment; and 
shall identify appeal opportunities underSec. 656.26. The debarment 
shall take effect on the start date identified in the Notice of 
Debarment unless a request for review is filed within the time permitted 
bySec. 656.26. DOL will notify DHS and the Department of State 
regarding any Notice of Debarment.
    (g) False statements. To knowingly and willfully furnish any false 
information in the preparation of the Application for Permanent 
Employment Certification (Form ETA 9089) or the Application for Alien 
Employment Certification (Form ETA 750) and any supporting 
documentation, or to aid, abet, or counsel another to do so is a Federal 
offense, punishable by fine or imprisonment up to five years, or both 
under 18 U.S.C. 2 and 1001. Other penalties apply as well to fraud or 
misuse of ETA immigration documents and to perjury with respect to such 
documents under 18 U.S.C. 1546 and 1621.

[72 FR 27946, May 17, 2007]



Sec.  656.32  Revocation of approved labor certifications.

    (a) Basis for DOL revocation. The Certifying Officer in consultation 
with the Chief, Division of Foreign Labor Certification may take steps 
to revoke an approved labor certification, if he/she finds the 
certification was not justified. A labor certification may also be 
invalidated by DHS or the Department of State as set forth inSec. 
656.30(d).
    (b) Department of Labor procedures for revocation. (1) The 
Certifying Officer sends to the employer a Notice of Intent to Revoke an 
approved labor certification which contains a detailed statement of the 
grounds for the revocation and the time period allowed for the 
employer's rebuttal. The employer may submit evidence in rebuttal within 
30 days of receipt of the notice. The Certifying Officer must consider 
all relevant evidence presented in deciding whether to revoke the labor 
certification.
    (2) If rebuttal evidence is not filed by the employer, the Notice of 
Intent to Revoke becomes the final decision of the Secretary.
    (3) If the employer files rebuttal evidence and the Certifying 
Officer determines the certification should be revoked, the employer may 
file an appeal underSec. 656.26.
    (4) The Certifying Officer will inform the employer within 30 days 
of receiving any rebuttal evidence whether or not the labor 
certification will be revoked.
    (5) If the labor certification is revoked, the Certifying Officer 
will also send a copy of the notification to the DHS and the Department 
of State.

[[Page 806]]



               Subpart D_Determination of Prevailing Wage



Sec.  656.40  Determination of prevailing wage for labor certification
purposes.

    (a) Application process. The employer must request a PWD from the 
NPC, on a form or in a manner prescribed by OFLC. Prior to January 1, 
2010, the SWA having jurisdiction over the area of intended employment 
shall continue to receive and process prevailing wage determination 
requests in accordance with the regulatory provisions and Department 
guidance in effect prior to January 1, 2009. On or after January 1, 
2010, the NPC shall receive and process prevailing wage determination 
requests in accordance with these regulations and with Department 
guidance. The NPC will provide the employer with an appropriate 
prevailing wage rate. The NPC shall determine the wage in accordance 
with sec. 212(t) of the INA. Unless the employer chooses to appeal the 
center's PWD underSec. 656.41(a) of this part, it files the 
Application for Permanent Employment Certification either electronically 
or by mail with the processing center of jurisdiction and maintains the 
PWD in its files. The determination shall be submitted to the CO, if 
requested.
    (b) Determinations. The National Processing Center will determine 
the appropriate prevailing wage as follows:
    (1) Except as provided in paragraphs (e) and (f) of this section, if 
the job opportunity is covered by a collective bargaining agreement 
(CBA) that was negotiated at arms-length between the union and the 
employer, the wage rate set forth in the CBA agreement is considered as 
not adversely affecting the wages of U.S. workers similarly employed, 
that is, it is considered the ``prevailing wage'' for labor 
certification purposes.
    (2) If the job opportunity is not covered by a CBA, the prevailing 
wage for labor certification purposes shall be the arithmetic mean, 
except as provided in paragraph (b)(3) of this section, of the wages of 
workers similarly employed in the area of intended employment. The wage 
component of the DOL Occupational Employment Statistics Survey shall be 
used to determine the arithmetic mean, unless the employer provides an 
acceptable survey under paragraph (g) of this section.
    (3) If the employer provides a survey acceptable under paragraph (g) 
of this section that provides a median and does not provide an 
arithmetic mean, the prevailing wage applicable to the employer's job 
opportunity shall be the median of the wages of workers similarly 
employed in the area of intended employment.
    (4) The employer may utilize a current wage determination in the 
area under the Davis-Bacon Act, 40 U.S.C. 276a et seq., 29 CFR part 1, 
or the McNamara-O'Hara Service Contract Act, 41 U.S.C. 351 et seq.
    (c) Validity period. The National Processing Center must specify the 
validity period of the prevailing wage, which in no event may be less 
than 90 days or more than 1 year from the determination date. To use a 
prevailing wage rate provided by the NPC, employers must file their 
applications or begin the recruitment period required by Sec.Sec. 
656.17(e) or 656.21 of this part within the validity period specified by 
the NPC.
    (d) Similarly employed. For purposes of this section, similarly 
employed means having substantially comparable jobs in the occupational 
category in the area of intended employment, except that, if a 
representative sample of workers in the occupational category can not be 
obtained in the area of intended employment, similarly employed means:
    (1) Having jobs requiring a substantially similar level of skills 
within the area of intended employment; or
    (2) If there are no substantially comparable jobs in the area of 
intended employment, having substantially comparable jobs with employers 
outside of the area of intended employment.
    (e) Institutions of higher education and research entities. In 
computing the prevailing wage for a job opportunity in an occupational 
classification in an area of intended employment for an employee of an 
institution of higher education, or an affiliated or related nonprofit 
entity, a nonprofit research organization, or a Governmental research 
organization, the prevailing wage level takes into account the wage

[[Page 807]]

levels of employees only at such institutions and organizations in the 
area of intended employment.
    (1) The organizations listed in this paragraph (e) are defined as 
follows:
    (i) Institution of higher education means an institution of higher 
education as defined in section 101(a) of the Higher Education Act of 
1965. Section 101(a) of that Act, 20 U.S.C. 1001(a)(2000), provides an 
institution of higher education is an educational institution in any 
state that:
    (A) Admits as regular students only persons having a certificate of 
graduation from a school providing secondary education, or the 
recognized equivalent of such a certificate;
    (B) Is legally authorized within such state to provide a program of 
education beyond secondary education;
    (C) Provides an educational program for which the institution awards 
a bachelor's degree or provides not less than a two-year program that is 
acceptable for full credit toward such a degree;
    (D) Is a public or other nonprofit institution; and
    (E) Is accredited by a nationally recognized accrediting agency or 
association or, if not so accredited, is an institution that has been 
granted preaccreditation status by such an agency or association that 
has been recognized by the Secretary of Education for the granting of 
preaccreditation status, and the Secretary of Education has determined 
there is satisfactory assurance the institution will meet the 
accreditation standards of such an agency or association within a 
reasonable time.
    (ii) Affiliated or related nonprofit entity means a nonprofit entity 
(including but not limited to a hospital and a medical or research 
institution) connected or associated with an institution of higher 
education, through shared ownership or control by the same board or 
federation, operated by an institution of higher education, or attached 
to an institution of higher education as a member, branch, cooperative, 
or subsidiary.
    (iii) Nonprofit research organization or Governmental research 
organization means a research organization that is either a nonprofit 
organization or entity primarily engaged in basic research and/or 
applied research, or a United States Government entity whose primary 
mission is the performance or promotion of basic research and/or applied 
research. Basic research is general research to gain more comprehensive 
knowledge or understanding of the subject under study, without specific 
applications in mind. Basic research is also research that advances 
scientific knowledge, but does not have specific immediate commercial 
objectives although it may be in fields of present or commercial 
interest. It may include research and investigation in the sciences, 
social sciences, or humanities. Applied research is research to gain 
knowledge or understanding to determine the means by which a specific, 
recognized need may be met. Applied research includes investigations 
oriented to discovering new scientific knowledge that has specific 
commercial objectives with respect to products, processes, or services. 
It may include research and investigation in the sciences, social 
sciences, or humanities.
    (2) Nonprofit organization or entity, for the purpose of this 
paragraph (e), means an organization qualified as a tax exempt 
organization under the Internal Revenue Code of 1986, section 501(c)(3), 
(c)(4), or (c)(6) (26 U.S.C. 501(c)(3), (c)(4) or (c)(6)), and which has 
received approval as a tax exempt organization from the Internal Revenue 
Service, as it relates to research or educational purposes.
    (f) Professional athletes. In computing the prevailing wage for a 
professional athlete (defined in Section 212(a)(5)(A)(iii)(II) of the 
Act) when the job opportunity is covered by professional sports league 
rules or regulations, the wage set forth in those rules or regulations 
is considered the prevailing wage (see Section 212(p)(2) of the Act). 
INA Section 212(a)(5)(A)(iii)(II), 8 U.S.C. 1182(a)(5)(A)(iii)(II) 
(1999), defines ``professional athlete'' as an individual who is 
employed as an athlete by--
    (1) A team that is a member of an association of six or more 
professional sports teams whose total combined revenues exceed 
$10,000,000 per year, if the association governs the conduct of its

[[Page 808]]

members and regulates the contests and exhibitions in which its member 
teams regularly engage; or
    (2) Any minor league team that is affiliated with such an 
association.
    (g) Employer-provided wage information. (1) If the job opportunity 
is not covered by a CBA, or by a professional sports league's rules or 
regulations, the NPC will consider wage information provided by the 
employer in making a PWD. An employer survey can be submitted either 
initially or after NPC issuance of a PWD derived from the OES survey. In 
the latter situation, the new employer survey submission will be deemed 
a new PWD request.
    (2) In each case where the employer submits a survey or other wage 
data for which it seeks acceptance, the employer must provide the NPC 
with enough information about the survey methodology, including such 
items as sample size and source, sample selection procedures, and survey 
job descriptions, to allow the NPC to make a determination about the 
adequacy of the data provided and validity of the statistical 
methodology used in conducting the survey in accordance with guidance 
issued by the OFLC national office.
    (3) The survey submitted to the NPC must be based upon recently 
collected data.
    (i) A published survey must have been published within 24 months of 
the date of submission to the NPC, must be the most current edition of 
the survey, and the data upon which the survey is based must have been 
collected within 24 months of the publication date of the survey.
    (ii) A survey conducted by the employer must be based on data 
collected within 24 months of the date it is submitted to the NPC.
    (4) If the employer-provided survey is found not to be acceptable, 
the NPC will inform the employer in writing of the reasons the survey 
was not accepted.
    (5) The employer, after receiving notification that the survey it 
provided for NPC consideration is not acceptable, may file supplemental 
information as provided by paragraph (h) of this section, file a new 
request for a PWD, or appeal underSec. 656.41.
    (h) Submittal of supplemental information by employer. (1) If the 
employer disagrees with the skill level assigned to its job opportunity, 
or if the NPC informs the employer its survey is not acceptable, or if 
there are other legitimate bases for such a review, the employer may 
submit supplemental information to the NPC.
    (2) The NPC will consider one supplemental submission about the 
employer's survey or the skill level the NPC assigned to the job 
opportunity or any other legitimate basis for the employer to request 
such a review. If the NPC does not accept the employer's survey after 
considering the supplemental information, or affirms its determination 
concerning the skill level, it will inform the employer of the reasons 
for its decision.
    (3) The employer may then apply for a new wage determination or 
appeal underSec. 656.41 of this part.
    (i) Frequent users. The Secretary will issue guidance regarding the 
process by which employers may obtain a wage determination to apply to a 
subsequent application, when the wage is for the same occupation, skill 
level, and area of intended employment. In no case may the wage rate the 
employer provides the NPC be lower than the highest wage required by any 
applicable Federal, State, or local law.
    (j) Fees prohibited. No SWA or SWA employee may charge a fee in 
connection with the filing of a request for a PWD, responding to such a 
request, or responding to a request for a review of a SWA prevailing 
wage determination underSec. 656.41.

[69 FR 77386, Dec. 27, 2004, as amended at 73 FR 78068, Dec. 19, 2008]



Sec.  656.41  Review of prevailing wage determinations.

    (a) Review of NPC PWD. Any employer desiring review of a PWD made by 
a CO must make a request for such review within 30 days of the date from 
when the PWD was issued. The request for review must be sent to the 
director of the NPC that issued the PWD within 30 days of the date of 
the PWD; clearly identify the PWD from which review is sought; set forth 
the particular grounds for the request; and include all the materials 
pertaining to the PWD

[[Page 809]]

submitted to the NPC up to the date of the PWD received from the NPC.
    (b) Processing of request by NPC. Upon the receipt of a request for 
review, the NPC will review the employer's request and accompanying 
documentation, and add any material that may have been omitted by the 
employer, including any material the NPC sent the employer up to the 
date of the PWD.
    (c) Review on the record. The director will review the PWD solely on 
the basis upon which the PWD was made and, upon the request for review, 
may either affirm or modify the PWD.
    (d) Request for review by BALCA. Any employer desiring review of the 
director's determination must make a request for review by the BALCA 
within 30 days of the date of the Director's decision.
    (1) The request for review, statements, briefs, and other 
submissions of the parties and amicus curiae must contain only legal 
arguments and only such evidence that was within the record upon which 
the director made his/her affirmation of the PWD.
    (2) The request for review must be in writing and addressed to the 
director of the NPC making the determination. Upon receipt of a request 
for a review, the director will assemble an indexed appeal file in 
reverse chronological order, with the index on top followed by the most 
recent document.
    (3) The director will send the Appeal File to the Office of 
Administrative Law Judges, BALCA. The BALCA handles the appeals in 
accordance with Sec.Sec. 656.26 and 656.27.

[73 FR 78069, Dec. 19, 2008]

[[Page 811]]



                              FINDING AIDS




  --------------------------------------------------------------------

  A list of CFR titles, subtitles, chapters, subchapters and parts and 
an alphabetical list of agencies publishing in the CFR are included in 
the CFR Index and Finding Aids volume to the Code of Federal Regulations 
which is published separately and revised annually.

  Table of CFR Titles and Chapters
  Alphabetical List of Agencies Appearing in the CFR
  List of CFR Sections Affected

[[Page 813]]



                    Table of CFR Titles and Chapters




                      (Revised as of April 1, 2012)

                      Title 1--General Provisions

         I  Administrative Committee of the Federal Register 
                (Parts 1--49)
        II  Office of the Federal Register (Parts 50--299)
       III  Administrative Conference of the United States (Parts 
                300--399)
        IV  Miscellaneous Agencies (Parts 400--500)

                    Title 2--Grants and Agreements

            Subtitle A--Office of Management and Budget Guidance 
                for Grants and Agreements
         I  Office of Management and Budget Governmentwide 
                Guidance for Grants and Agreements (Parts 2--199)
        II  Office of Management and Budget Circulars and Guidance 
                (200--299)
            Subtitle B--Federal Agency Regulations for Grants and 
                Agreements
       III  Department of Health and Human Services (Parts 300-- 
                399)
        IV  Department of Agriculture (Parts 400--499)
        VI  Department of State (Parts 600--699)
       VII  Agency for International Development (Parts 700--799)
      VIII  Department of Veterans Affairs (Parts 800--899)
        IX  Department of Energy (Parts 900--999)
        XI  Department of Defense (Parts 1100--1199)
       XII  Department of Transportation (Parts 1200--1299)
      XIII  Department of Commerce (Parts 1300--1399)
       XIV  Department of the Interior (Parts 1400--1499)
        XV  Environmental Protection Agency (Parts 1500--1599)
     XVIII  National Aeronautics and Space Administration (Parts 
                1800--1899)
        XX  United States Nuclear Regulatory Commission (Parts 
                2000--2099)
      XXII  Corporation for National and Community Service (Parts 
                2200--2299)
     XXIII  Social Security Administration (Parts 2300--2399)
      XXIV  Housing and Urban Development (Parts 2400--2499)
       XXV  National Science Foundation (Parts 2500--2599)
      XXVI  National Archives and Records Administration (Parts 
                2600--2699)
     XXVII  Small Business Administration (Parts 2700--2799)
    XXVIII  Department of Justice (Parts 2800--2899)

[[Page 814]]

       XXX  Department of Homeland Security (Parts 3000--3099)
      XXXI  Institute of Museum and Library Services (Parts 3100--
                3199)
     XXXII  National Endowment for the Arts (Parts 3200--3299)
    XXXIII  National Endowment for the Humanities (Parts 3300--
                3399)
     XXXIV  Department of Education (Parts 3400--3499)
      XXXV  Export-Import Bank of the United States (Parts 3500--
                3599)
    XXXVII  Peace Corps (Parts 3700--3799)
     LVIII  Election Assistance Commission (Parts 5800--5899)

                        Title 3--The President

         I  Executive Office of the President (Parts 100--199)

                           Title 4--Accounts

         I  Government Accountability Office (Parts 1--199)
        II  Recovery Accountability and Transparency Board (Parts 
                200--299)

                   Title 5--Administrative Personnel

         I  Office of Personnel Management (Parts 1--1199)
        II  Merit Systems Protection Board (Parts 1200--1299)
       III  Office of Management and Budget (Parts 1300--1399)
         V  The International Organizations Employees Loyalty 
                Board (Parts 1500--1599)
        VI  Federal Retirement Thrift Investment Board (Parts 
                1600--1699)
      VIII  Office of Special Counsel (Parts 1800--1899)
        IX  Appalachian Regional Commission (Parts 1900--1999)
        XI  Armed Forces Retirement Home (Parts 2100--2199)
       XIV  Federal Labor Relations Authority, General Counsel of 
                the Federal Labor Relations Authority and Federal 
                Service Impasses Panel (Parts 2400--2499)
        XV  Office of Administration, Executive Office of the 
                President (Parts 2500--2599)
       XVI  Office of Government Ethics (Parts 2600--2699)
       XXI  Department of the Treasury (Parts 3100--3199)
      XXII  Federal Deposit Insurance Corporation (Parts 3200--
                3299)
     XXIII  Department of Energy (Parts 3300--3399)
      XXIV  Federal Energy Regulatory Commission (Parts 3400--
                3499)
       XXV  Department of the Interior (Parts 3500--3599)
      XXVI  Department of Defense (Parts 3600-- 3699)
    XXVIII  Department of Justice (Parts 3800--3899)
      XXIX  Federal Communications Commission (Parts 3900--3999)
       XXX  Farm Credit System Insurance Corporation (Parts 4000--
                4099)
      XXXI  Farm Credit Administration (Parts 4100--4199)

[[Page 815]]

    XXXIII  Overseas Private Investment Corporation (Parts 4300--
                4399)
     XXXIV  Securities and Exchange Commission (Parts 4400--4499)
      XXXV  Office of Personnel Management (Parts 4500--4599)
    XXXVII  Federal Election Commission (Parts 4700--4799)
        XL  Interstate Commerce Commission (Parts 5000--5099)
       XLI  Commodity Futures Trading Commission (Parts 5100--
                5199)
      XLII  Department of Labor (Parts 5200--5299)
     XLIII  National Science Foundation (Parts 5300--5399)
       XLV  Department of Health and Human Services (Parts 5500--
                5599)
      XLVI  Postal Rate Commission (Parts 5600--5699)
     XLVII  Federal Trade Commission (Parts 5700--5799)
    XLVIII  Nuclear Regulatory Commission (Parts 5800--5899)
      XLIX  Federal Labor Relations Authority (Parts 5900--5999)
         L  Department of Transportation (Parts 6000--6099)
       LII  Export-Import Bank of the United States (Parts 6200--
                6299)
      LIII  Department of Education (Parts 6300--6399)
       LIV  Environmental Protection Agency (Parts 6400--6499)
        LV  National Endowment for the Arts (Parts 6500--6599)
       LVI  National Endowment for the Humanities (Parts 6600--
                6699)
      LVII  General Services Administration (Parts 6700--6799)
     LVIII  Board of Governors of the Federal Reserve System 
                (Parts 6800--6899)
       LIX  National Aeronautics and Space Administration (Parts 
                6900--6999)
        LX  United States Postal Service (Parts 7000--7099)
       LXI  National Labor Relations Board (Parts 7100--7199)
      LXII  Equal Employment Opportunity Commission (Parts 7200--
                7299)
     LXIII  Inter-American Foundation (Parts 7300--7399)
      LXIV  Merit Systems Protection Board (Parts 7400--7499)
       LXV  Department of Housing and Urban Development (Parts 
                7500--7599)
      LXVI  National Archives and Records Administration (Parts 
                7600--7699)
     LXVII  Institute of Museum and Library Services (Parts 7700--
                7799)
    LXVIII  Commission on Civil Rights (Parts 7800--7899)
      LXIX  Tennessee Valley Authority (Parts 7900--7999)
       LXX  Court Services and Offender Supervision Agency for the 
                District of Columbia (Parts 8000--8099)
      LXXI  Consumer Product Safety Commission (Parts 8100--8199)
    LXXIII  Department of Agriculture (Parts 8300--8399)
     LXXIV  Federal Mine Safety and Health Review Commission 
                (Parts 8400--8499)
     LXXVI  Federal Retirement Thrift Investment Board (Parts 
                8600--8699)
    LXXVII  Office of Management and Budget (Parts 8700--8799)
      LXXX  Federal Housing Finance Agency (Parts 9000--9099)
    LXXXII  Special Inspector General for Iraq Reconstruction 
                (Parts 9200--9299)

[[Page 816]]

     XCVII  Department of Homeland Security Human Resources 
                Management System (Department of Homeland 
                Security--Office of Personnel Management) (Parts 
                9700--9799)

                      Title 6--Domestic Security

         I  Department of Homeland Security, Office of the 
                Secretary (Parts 1--99)

                         Title 7--Agriculture

            Subtitle A--Office of the Secretary of Agriculture 
                (Parts 0--26)
            Subtitle B--Regulations of the Department of 
                Agriculture
         I  Agricultural Marketing Service (Standards, 
                Inspections, Marketing Practices), Department of 
                Agriculture (Parts 27--209)
        II  Food and Nutrition Service, Department of Agriculture 
                (Parts 210--299)
       III  Animal and Plant Health Inspection Service, Department 
                of Agriculture (Parts 300--399)
        IV  Federal Crop Insurance Corporation, Department of 
                Agriculture (Parts 400--499)
         V  Agricultural Research Service, Department of 
                Agriculture (Parts 500--599)
        VI  Natural Resources Conservation Service, Department of 
                Agriculture (Parts 600--699)
       VII  Farm Service Agency, Department of Agriculture (Parts 
                700--799)
      VIII  Grain Inspection, Packers and Stockyards 
                Administration (Federal Grain Inspection Service), 
                Department of Agriculture (Parts 800--899)
        IX  Agricultural Marketing Service (Marketing Agreements 
                and Orders; Fruits, Vegetables, Nuts), Department 
                of Agriculture (Parts 900--999)
         X  Agricultural Marketing Service (Marketing Agreements 
                and Orders; Milk), Department of Agriculture 
                (Parts 1000--1199)
        XI  Agricultural Marketing Service (Marketing Agreements 
                and Orders; Miscellaneous Commodities), Department 
                of Agriculture (Parts 1200--1299)
       XIV  Commodity Credit Corporation, Department of 
                Agriculture (Parts 1400--1499)
        XV  Foreign Agricultural Service, Department of 
                Agriculture (Parts 1500--1599)
       XVI  Rural Telephone Bank, Department of Agriculture (Parts 
                1600--1699)
      XVII  Rural Utilities Service, Department of Agriculture 
                (Parts 1700--1799)
     XVIII  Rural Housing Service, Rural Business-Cooperative 
                Service, Rural Utilities Service, and Farm Service 
                Agency, Department of Agriculture (Parts 1800--
                2099)
        XX  Local Television Loan Guarantee Board (Parts 2200--
                2299)

[[Page 817]]

       XXV  Office of Advocacy and Outreach, Department of 
                Agriculture (Parts 2500--2599)
      XXVI  Office of Inspector General, Department of Agriculture 
                (Parts 2600--2699)
     XXVII  Office of Information Resources Management, Department 
                of Agriculture (Parts 2700--2799)
    XXVIII  Office of Operations, Department of Agriculture (Parts 
                2800--2899)
      XXIX  Office of Energy Policy and New Uses, Department of 
                Agriculture (Parts 2900--2999)
       XXX  Office of the Chief Financial Officer, Department of 
                Agriculture (Parts 3000--3099)
      XXXI  Office of Environmental Quality, Department of 
                Agriculture (Parts 3100--3199)
     XXXII  Office of Procurement and Property Management, 
                Department of Agriculture (Parts 3200--3299)
    XXXIII  Office of Transportation, Department of Agriculture 
                (Parts 3300--3399)
     XXXIV  National Institute of Food and Agriculture (Parts 
                3400--3499)
      XXXV  Rural Housing Service, Department of Agriculture 
                (Parts 3500--3599)
     XXXVI  National Agricultural Statistics Service, Department 
                of Agriculture (Parts 3600--3699)
    XXXVII  Economic Research Service, Department of Agriculture 
                (Parts 3700--3799)
   XXXVIII  World Agricultural Outlook Board, Department of 
                Agriculture (Parts 3800--3899)
       XLI  [Reserved]
      XLII  Rural Business-Cooperative Service and Rural Utilities 
                Service, Department of Agriculture (Parts 4200--
                4299)

                    Title 8--Aliens and Nationality

         I  Department of Homeland Security (Immigration and 
                Naturalization) (Parts 1--499)
         V  Executive Office for Immigration Review, Department of 
                Justice (Parts 1000--1399)

                 Title 9--Animals and Animal Products

         I  Animal and Plant Health Inspection Service, Department 
                of Agriculture (Parts 1--199)
        II  Grain Inspection, Packers and Stockyards 
                Administration (Packers and Stockyards Programs), 
                Department of Agriculture (Parts 200--299)
       III  Food Safety and Inspection Service, Department of 
                Agriculture (Parts 300--599)

[[Page 818]]

                           Title 10--Energy

         I  Nuclear Regulatory Commission (Parts 0--199)
        II  Department of Energy (Parts 200--699)
       III  Department of Energy (Parts 700--999)
         X  Department of Energy (General Provisions) (Parts 
                1000--1099)
      XIII  Nuclear Waste Technical Review Board (Parts 1300--
                1399)
      XVII  Defense Nuclear Facilities Safety Board (Parts 1700--
                1799)
     XVIII  Northeast Interstate Low-Level Radioactive Waste 
                Commission (Parts 1800--1899)

                      Title 11--Federal Elections

         I  Federal Election Commission (Parts 1--9099)
        II  Election Assistance Commission (Parts 9400--9499)

                      Title 12--Banks and Banking

         I  Comptroller of the Currency, Department of the 
                Treasury (Parts 1--199)
        II  Federal Reserve System (Parts 200--299)
       III  Federal Deposit Insurance Corporation (Parts 300--399)
        IV  Export-Import Bank of the United States (Parts 400--
                499)
         V  Office of Thrift Supervision, Department of the 
                Treasury (Parts 500--599)
        VI  Farm Credit Administration (Parts 600--699)
       VII  National Credit Union Administration (Parts 700--799)
      VIII  Federal Financing Bank (Parts 800--899)
        IX  Federal Housing Finance Board (Parts 900--999)
         X  Bureau of Consumer Financial Protection (Parts 1000--
                1099)
        XI  Federal Financial Institutions Examination Council 
                (Parts 1100--1199)
       XII  Federal Housing Finance Agency (Parts 1200--1299)
      XIII  Financial Stability Oversight Council (Parts 1300--
                1399)
       XIV  Farm Credit System Insurance Corporation (Parts 1400--
                1499)
        XV  Department of the Treasury (Parts 1500--1599)
       XVI  Office of Financial Research (Parts 1600--1699)
      XVII  Office of Federal Housing Enterprise Oversight, 
                Department of Housing and Urban Development (Parts 
                1700--1799)
     XVIII  Community Development Financial Institutions Fund, 
                Department of the Treasury (Parts 1800--1899)

               Title 13--Business Credit and Assistance

         I  Small Business Administration (Parts 1--199)
       III  Economic Development Administration, Department of 
                Commerce (Parts 300--399)
        IV  Emergency Steel Guarantee Loan Board (Parts 400--499)
         V  Emergency Oil and Gas Guaranteed Loan Board (Parts 
                500--599)

[[Page 819]]

                    Title 14--Aeronautics and Space

         I  Federal Aviation Administration, Department of 
                Transportation (Parts 1--199)
        II  Office of the Secretary, Department of Transportation 
                (Aviation Proceedings) (Parts 200--399)
       III  Commercial Space Transportation, Federal Aviation 
                Administration, Department of Transportation 
                (Parts 400--1199)
         V  National Aeronautics and Space Administration (Parts 
                1200--1299)
        VI  Air Transportation System Stabilization (Parts 1300--
                1399)

                 Title 15--Commerce and Foreign Trade

            Subtitle A--Office of the Secretary of Commerce (Parts 
                0--29)
            Subtitle B--Regulations Relating to Commerce and 
                Foreign Trade
         I  Bureau of the Census, Department of Commerce (Parts 
                30--199)
        II  National Institute of Standards and Technology, 
                Department of Commerce (Parts 200--299)
       III  International Trade Administration, Department of 
                Commerce (Parts 300--399)
        IV  Foreign-Trade Zones Board, Department of Commerce 
                (Parts 400--499)
       VII  Bureau of Industry and Security, Department of 
                Commerce (Parts 700--799)
      VIII  Bureau of Economic Analysis, Department of Commerce 
                (Parts 800--899)
        IX  National Oceanic and Atmospheric Administration, 
                Department of Commerce (Parts 900--999)
        XI  Technology Administration, Department of Commerce 
                (Parts 1100--1199)
      XIII  East-West Foreign Trade Board (Parts 1300--1399)
       XIV  Minority Business Development Agency (Parts 1400--
                1499)
            Subtitle C--Regulations Relating to Foreign Trade 
                Agreements
        XX  Office of the United States Trade Representative 
                (Parts 2000--2099)
            Subtitle D--Regulations Relating to Telecommunications 
                and Information
     XXIII  National Telecommunications and Information 
                Administration, Department of Commerce (Parts 
                2300--2399)

                    Title 16--Commercial Practices

         I  Federal Trade Commission (Parts 0--999)
        II  Consumer Product Safety Commission (Parts 1000--1799)

[[Page 820]]

             Title 17--Commodity and Securities Exchanges

         I  Commodity Futures Trading Commission (Parts 1--199)
        II  Securities and Exchange Commission (Parts 200--399)
        IV  Department of the Treasury (Parts 400--499)

          Title 18--Conservation of Power and Water Resources

         I  Federal Energy Regulatory Commission, Department of 
                Energy (Parts 1--399)
       III  Delaware River Basin Commission (Parts 400--499)
        VI  Water Resources Council (Parts 700--799)
      VIII  Susquehanna River Basin Commission (Parts 800--899)
      XIII  Tennessee Valley Authority (Parts 1300--1399)

                       Title 19--Customs Duties

         I  U.S. Customs and Border Protection, Department of 
                Homeland Security; Department of the Treasury 
                (Parts 0--199)
        II  United States International Trade Commission (Parts 
                200--299)
       III  International Trade Administration, Department of 
                Commerce (Parts 300--399)
        IV  U.S. Immigration and Customs Enforcement, Department 
                of Homeland Security (Parts 400--599)

                     Title 20--Employees' Benefits

         I  Office of Workers' Compensation Programs, Department 
                of Labor (Parts 1--199)
        II  Railroad Retirement Board (Parts 200--399)
       III  Social Security Administration (Parts 400--499)
        IV  Employees' Compensation Appeals Board, Department of 
                Labor (Parts 500--599)
         V  Employment and Training Administration, Department of 
                Labor (Parts 600--699)
        VI  Office of Workers' Compensation Programs, Department 
                of Labor (Parts 700--799)
       VII  Benefits Review Board, Department of Labor (Parts 
                800--899)
      VIII  Joint Board for the Enrollment of Actuaries (Parts 
                900--999)
        IX  Office of the Assistant Secretary for Veterans' 
                Employment and Training Service, Department of 
                Labor (Parts 1000--1099)

                       Title 21--Food and Drugs

         I  Food and Drug Administration, Department of Health and 
                Human Services (Parts 1--1299)
        II  Drug Enforcement Administration, Department of Justice 
                (Parts 1300--1399)
       III  Office of National Drug Control Policy (Parts 1400--
                1499)

[[Page 821]]

                      Title 22--Foreign Relations

         I  Department of State (Parts 1--199)
        II  Agency for International Development (Parts 200--299)
       III  Peace Corps (Parts 300--399)
        IV  International Joint Commission, United States and 
                Canada (Parts 400--499)
         V  Broadcasting Board of Governors (Parts 500--599)
       VII  Overseas Private Investment Corporation (Parts 700--
                799)
        IX  Foreign Service Grievance Board (Parts 900--999)
         X  Inter-American Foundation (Parts 1000--1099)
        XI  International Boundary and Water Commission, United 
                States and Mexico, United States Section (Parts 
                1100--1199)
       XII  United States International Development Cooperation 
                Agency (Parts 1200--1299)
      XIII  Millennium Challenge Corporation (Parts 1300--1399)
       XIV  Foreign Service Labor Relations Board; Federal Labor 
                Relations Authority; General Counsel of the 
                Federal Labor Relations Authority; and the Foreign 
                Service Impasse Disputes Panel (Parts 1400--1499)
        XV  African Development Foundation (Parts 1500--1599)
       XVI  Japan-United States Friendship Commission (Parts 
                1600--1699)
      XVII  United States Institute of Peace (Parts 1700--1799)

                          Title 23--Highways

         I  Federal Highway Administration, Department of 
                Transportation (Parts 1--999)
        II  National Highway Traffic Safety Administration and 
                Federal Highway Administration, Department of 
                Transportation (Parts 1200--1299)
       III  National Highway Traffic Safety Administration, 
                Department of Transportation (Parts 1300--1399)

                Title 24--Housing and Urban Development

            Subtitle A--Office of the Secretary, Department of 
                Housing and Urban Development (Parts 0--99)
            Subtitle B--Regulations Relating to Housing and Urban 
                Development
         I  Office of Assistant Secretary for Equal Opportunity, 
                Department of Housing and Urban Development (Parts 
                100--199)
        II  Office of Assistant Secretary for Housing-Federal 
                Housing Commissioner, Department of Housing and 
                Urban Development (Parts 200--299)
       III  Government National Mortgage Association, Department 
                of Housing and Urban Development (Parts 300--399)
        IV  Office of Housing and Office of Multifamily Housing 
                Assistance Restructuring, Department of Housing 
                and Urban Development (Parts 400--499)

[[Page 822]]

         V  Office of Assistant Secretary for Community Planning 
                and Development, Department of Housing and Urban 
                Development (Parts 500--599)
        VI  Office of Assistant Secretary for Community Planning 
                and Development, Department of Housing and Urban 
                Development (Parts 600--699) [Reserved]
       VII  Office of the Secretary, Department of Housing and 
                Urban Development (Housing Assistance Programs and 
                Public and Indian Housing Programs) (Parts 700--
                799)
      VIII  Office of the Assistant Secretary for Housing--Federal 
                Housing Commissioner, Department of Housing and 
                Urban Development (Section 8 Housing Assistance 
                Programs, Section 202 Direct Loan Program, Section 
                202 Supportive Housing for the Elderly Program and 
                Section 811 Supportive Housing for Persons With 
                Disabilities Program) (Parts 800--899)
        IX  Office of Assistant Secretary for Public and Indian 
                Housing, Department of Housing and Urban 
                Development (Parts 900--1699)
         X  Office of Assistant Secretary for Housing--Federal 
                Housing Commissioner, Department of Housing and 
                Urban Development (Interstate Land Sales 
                Registration Program) (Parts 1700--1799)
       XII  Office of Inspector General, Department of Housing and 
                Urban Development (Parts 2000--2099)
        XV  Emergency Mortgage Insurance and Loan Programs, 
                Department of Housing and Urban Development (Parts 
                2700--2799)
        XX  Office of Assistant Secretary for Housing--Federal 
                Housing Commissioner, Department of Housing and 
                Urban Development (Parts 3200--3899)
      XXIV  Board of Directors of the HOPE for Homeowners Program 
                (Parts 4000--4099)
       XXV  Neighborhood Reinvestment Corporation (Parts 4100--
                4199)

                           Title 25--Indians

         I  Bureau of Indian Affairs, Department of the Interior 
                (Parts 1--299)
        II  Indian Arts and Crafts Board, Department of the 
                Interior (Parts 300--399)
       III  National Indian Gaming Commission, Department of the 
                Interior (Parts 500--599)
        IV  Office of Navajo and Hopi Indian Relocation (Parts 
                700--799)
         V  Bureau of Indian Affairs, Department of the Interior, 
                and Indian Health Service, Department of Health 
                and Human Services (Part 900)
        VI  Office of the Assistant Secretary-Indian Affairs, 
                Department of the Interior (Parts 1000--1199)
       VII  Office of the Special Trustee for American Indians, 
                Department of the Interior (Parts 1200--1299)

[[Page 823]]

                      Title 26--Internal Revenue

         I  Internal Revenue Service, Department of the Treasury 
                (Parts 1--End)

           Title 27--Alcohol, Tobacco Products and Firearms

         I  Alcohol and Tobacco Tax and Trade Bureau, Department 
                of the Treasury (Parts 1--399)
        II  Bureau of Alcohol, Tobacco, Firearms, and Explosives, 
                Department of Justice (Parts 400--699)

                   Title 28--Judicial Administration

         I  Department of Justice (Parts 0--299)
       III  Federal Prison Industries, Inc., Department of Justice 
                (Parts 300--399)
         V  Bureau of Prisons, Department of Justice (Parts 500--
                599)
        VI  Offices of Independent Counsel, Department of Justice 
                (Parts 600--699)
       VII  Office of Independent Counsel (Parts 700--799)
      VIII  Court Services and Offender Supervision Agency for the 
                District of Columbia (Parts 800--899)
        IX  National Crime Prevention and Privacy Compact Council 
                (Parts 900--999)
        XI  Department of Justice and Department of State (Parts 
                1100--1199)

                            Title 29--Labor

            Subtitle A--Office of the Secretary of Labor (Parts 
                0--99)
            Subtitle B--Regulations Relating to Labor
         I  National Labor Relations Board (Parts 100--199)
        II  Office of Labor-Management Standards, Department of 
                Labor (Parts 200--299)
       III  National Railroad Adjustment Board (Parts 300--399)
        IV  Office of Labor-Management Standards, Department of 
                Labor (Parts 400--499)
         V  Wage and Hour Division, Department of Labor (Parts 
                500--899)
        IX  Construction Industry Collective Bargaining Commission 
                (Parts 900--999)
         X  National Mediation Board (Parts 1200--1299)
       XII  Federal Mediation and Conciliation Service (Parts 
                1400--1499)
       XIV  Equal Employment Opportunity Commission (Parts 1600--
                1699)
      XVII  Occupational Safety and Health Administration, 
                Department of Labor (Parts 1900--1999)
        XX  Occupational Safety and Health Review Commission 
                (Parts 2200--2499)
       XXV  Employee Benefits Security Administration, Department 
                of Labor (Parts 2500--2599)

[[Page 824]]

     XXVII  Federal Mine Safety and Health Review Commission 
                (Parts 2700--2799)
        XL  Pension Benefit Guaranty Corporation (Parts 4000--
                4999)

                      Title 30--Mineral Resources

         I  Mine Safety and Health Administration, Department of 
                Labor (Parts 1--199)
        II  Bureau of Safety and Environmental Enforcement, 
                Department of the Interior (Parts 200--299)
        IV  Geological Survey, Department of the Interior (Parts 
                400--499)
         V  Bureau of Ocean Energy Management, Department of the 
                Interior (Parts 500--599)
       VII  Office of Surface Mining Reclamation and Enforcement, 
                Department of the Interior (Parts 700--999)
       XII  Office of Natural Resources Revenue, Department of the 
                Interior (Parts 1200--1299)

                 Title 31--Money and Finance: Treasury

            Subtitle A--Office of the Secretary of the Treasury 
                (Parts 0--50)
            Subtitle B--Regulations Relating to Money and Finance
         I  Monetary Offices, Department of the Treasury (Parts 
                51--199)
        II  Fiscal Service, Department of the Treasury (Parts 
                200--399)
        IV  Secret Service, Department of the Treasury (Parts 
                400--499)
         V  Office of Foreign Assets Control, Department of the 
                Treasury (Parts 500--599)
        VI  Bureau of Engraving and Printing, Department of the 
                Treasury (Parts 600--699)
       VII  Federal Law Enforcement Training Center, Department of 
                the Treasury (Parts 700--799)
      VIII  Office of International Investment, Department of the 
                Treasury (Parts 800--899)
        IX  Federal Claims Collection Standards (Department of the 
                Treasury--Department of Justice) (Parts 900--999)
         X  Financial Crimes Enforcement Network, Department of 
                the Treasury (Parts 1000--1099)

                      Title 32--National Defense

            Subtitle A--Department of Defense
         I  Office of the Secretary of Defense (Parts 1--399)
         V  Department of the Army (Parts 400--699)
        VI  Department of the Navy (Parts 700--799)
       VII  Department of the Air Force (Parts 800--1099)
            Subtitle B--Other Regulations Relating to National 
                Defense

[[Page 825]]

       XII  Defense Logistics Agency (Parts 1200--1299)
       XVI  Selective Service System (Parts 1600--1699)
      XVII  Office of the Director of National Intelligence (Parts 
                1700--1799)
     XVIII  National Counterintelligence Center (Parts 1800--1899)
       XIX  Central Intelligence Agency (Parts 1900--1999)
        XX  Information Security Oversight Office, National 
                Archives and Records Administration (Parts 2000--
                2099)
       XXI  National Security Council (Parts 2100--2199)
      XXIV  Office of Science and Technology Policy (Parts 2400--
                2499)
     XXVII  Office for Micronesian Status Negotiations (Parts 
                2700--2799)
    XXVIII  Office of the Vice President of the United States 
                (Parts 2800--2899)

               Title 33--Navigation and Navigable Waters

         I  Coast Guard, Department of Homeland Security (Parts 
                1--199)
        II  Corps of Engineers, Department of the Army (Parts 
                200--399)
        IV  Saint Lawrence Seaway Development Corporation, 
                Department of Transportation (Parts 400--499)

                          Title 34--Education

            Subtitle A--Office of the Secretary, Department of 
                Education (Parts 1--99)
            Subtitle B--Regulations of the Offices of the 
                Department of Education
         I  Office for Civil Rights, Department of Education 
                (Parts 100--199)
        II  Office of Elementary and Secondary Education, 
                Department of Education (Parts 200--299)
       III  Office of Special Education and Rehabilitative 
                Services, Department of Education (Parts 300--399)
        IV  Office of Vocational and Adult Education, Department 
                of Education (Parts 400--499)
         V  Office of Bilingual Education and Minority Languages 
                Affairs, Department of Education (Parts 500--599)
        VI  Office of Postsecondary Education, Department of 
                Education (Parts 600--699)
       VII  Office of Educational Research and Improvement, 
                Department of Education [Reserved]
        XI  National Institute for Literacy (Parts 1100--1199)
            Subtitle C--Regulations Relating to Education
       XII  National Council on Disability (Parts 1200--1299)

                          Title 35 [Reserved]

             Title 36--Parks, Forests, and Public Property

         I  National Park Service, Department of the Interior 
                (Parts 1--199)

[[Page 826]]

        II  Forest Service, Department of Agriculture (Parts 200--
                299)
       III  Corps of Engineers, Department of the Army (Parts 
                300--399)
        IV  American Battle Monuments Commission (Parts 400--499)
         V  Smithsonian Institution (Parts 500--599)
        VI  [Reserved]
       VII  Library of Congress (Parts 700--799)
      VIII  Advisory Council on Historic Preservation (Parts 800--
                899)
        IX  Pennsylvania Avenue Development Corporation (Parts 
                900--999)
         X  Presidio Trust (Parts 1000--1099)
        XI  Architectural and Transportation Barriers Compliance 
                Board (Parts 1100--1199)
       XII  National Archives and Records Administration (Parts 
                1200--1299)
        XV  Oklahoma City National Memorial Trust (Parts 1500--
                1599)
       XVI  Morris K. Udall Scholarship and Excellence in National 
                Environmental Policy Foundation (Parts 1600--1699)

             Title 37--Patents, Trademarks, and Copyrights

         I  United States Patent and Trademark Office, Department 
                of Commerce (Parts 1--199)
        II  Copyright Office, Library of Congress (Parts 200--299)
       III  Copyright Royalty Board, Library of Congress (Parts 
                300--399)
        IV  Assistant Secretary for Technology Policy, Department 
                of Commerce (Parts 400--499)
         V  Under Secretary for Technology, Department of Commerce 
                (Parts 500--599)

           Title 38--Pensions, Bonuses, and Veterans' Relief

         I  Department of Veterans Affairs (Parts 0--199)
        II  Armed Forces Retirement Home (Parts 200--299)

                       Title 39--Postal Service

         I  United States Postal Service (Parts 1--999)
       III  Postal Regulatory Commission (Parts 3000--3099)

                  Title 40--Protection of Environment

         I  Environmental Protection Agency (Parts 1--1099)
        IV  Environmental Protection Agency and Department of 
                Justice (Parts 1400--1499)
         V  Council on Environmental Quality (Parts 1500--1599)
        VI  Chemical Safety and Hazard Investigation Board (Parts 
                1600--1699)
       VII  Environmental Protection Agency and Department of 
                Defense; Uniform National Discharge Standards for 
                Vessels of the Armed Forces (Parts 1700--1799)

[[Page 827]]

          Title 41--Public Contracts and Property Management

            Subtitle A--Federal Procurement Regulations System 
                [Note]
            Subtitle B--Other Provisions Relating to Public 
                Contracts
        50  Public Contracts, Department of Labor (Parts 50-1--50-
                999)
        51  Committee for Purchase From People Who Are Blind or 
                Severely Disabled (Parts 51-1--51-99)
        60  Office of Federal Contract Compliance Programs, Equal 
                Employment Opportunity, Department of Labor (Parts 
                60-1--60-999)
        61  Office of the Assistant Secretary for Veterans' 
                Employment and Training Service, Department of 
                Labor (Parts 61-1--61-999)
    62-100  [Reserved]
            Subtitle C--Federal Property Management Regulations 
                System
       101  Federal Property Management Regulations (Parts 101-1--
                101-99)
       102  Federal Management Regulation (Parts 102-1--102-299)
   103-104  [Reserved]
       105  General Services Administration (Parts 105-1--105-999)
       109  Department of Energy Property Management Regulations 
                (Parts 109-1--109-99)
       114  Department of the Interior (Parts 114-1--114-99)
       115  Environmental Protection Agency (Parts 115-1--115-99)
       128  Department of Justice (Parts 128-1--128-99)
   129-200  [Reserved]
            Subtitle D--Other Provisions Relating to Property 
                Management [Reserved]
            Subtitle E--Federal Information Resources Management 
                Regulations System [Reserved]
            Subtitle F--Federal Travel Regulation System
       300  General (Parts 300-1--300-99)
       301  Temporary Duty (TDY) Travel Allowances (Parts 301-1--
                301-99)
       302  Relocation Allowances (Parts 302-1--302-99)
       303  Payment of Expenses Connected with the Death of 
                Certain Employees (Part 303-1--303-99)
       304  Payment of Travel Expenses from a Non-Federal Source 
                (Parts 304-1--304-99)

                        Title 42--Public Health

         I  Public Health Service, Department of Health and Human 
                Services (Parts 1--199)
        IV  Centers for Medicare & Medicaid Services, Department 
                of Health and Human Services (Parts 400--599)
         V  Office of Inspector General-Health Care, Department of 
                Health and Human Services (Parts 1000--1999)

[[Page 828]]

                   Title 43--Public Lands: Interior

            Subtitle A--Office of the Secretary of the Interior 
                (Parts 1--199)
            Subtitle B--Regulations Relating to Public Lands
         I  Bureau of Reclamation, Department of the Interior 
                (Parts 400--999)
        II  Bureau of Land Management, Department of the Interior 
                (Parts 1000--9999)
       III  Utah Reclamation Mitigation and Conservation 
                Commission (Parts 10000--10099)

             Title 44--Emergency Management and Assistance

         I  Federal Emergency Management Agency, Department of 
                Homeland Security (Parts 0--399)
        IV  Department of Commerce and Department of 
                Transportation (Parts 400--499)

                       Title 45--Public Welfare

            Subtitle A--Department of Health and Human Services 
                (Parts 1--199)
            Subtitle B--Regulations Relating to Public Welfare
        II  Office of Family Assistance (Assistance Programs), 
                Administration for Children and Families, 
                Department of Health and Human Services (Parts 
                200--299)
       III  Office of Child Support Enforcement (Child Support 
                Enforcement Program), Administration for Children 
                and Families, Department of Health and Human 
                Services (Parts 300--399)
        IV  Office of Refugee Resettlement, Administration for 
                Children and Families, Department of Health and 
                Human Services (Parts 400--499)
         V  Foreign Claims Settlement Commission of the United 
                States, Department of Justice (Parts 500--599)
        VI  National Science Foundation (Parts 600--699)
       VII  Commission on Civil Rights (Parts 700--799)
      VIII  Office of Personnel Management (Parts 800--899) 
                [Reserved]
         X  Office of Community Services, Administration for 
                Children and Families, Department of Health and 
                Human Services (Parts 1000--1099)
        XI  National Foundation on the Arts and the Humanities 
                (Parts 1100--1199)
       XII  Corporation for National and Community Service (Parts 
                1200--1299)
      XIII  Office of Human Development Services, Department of 
                Health and Human Services (Parts 1300--1399)
       XVI  Legal Services Corporation (Parts 1600--1699)
      XVII  National Commission on Libraries and Information 
                Science (Parts 1700--1799)
     XVIII  Harry S. Truman Scholarship Foundation (Parts 1800--
                1899)
       XXI  Commission on Fine Arts (Parts 2100--2199)

[[Page 829]]

     XXIII  Arctic Research Commission (Part 2301)
      XXIV  James Madison Memorial Fellowship Foundation (Parts 
                2400--2499)
       XXV  Corporation for National and Community Service (Parts 
                2500--2599)

                          Title 46--Shipping

         I  Coast Guard, Department of Homeland Security (Parts 
                1--199)
        II  Maritime Administration, Department of Transportation 
                (Parts 200--399)
       III  Coast Guard (Great Lakes Pilotage), Department of 
                Homeland Security (Parts 400--499)
        IV  Federal Maritime Commission (Parts 500--599)

                      Title 47--Telecommunication

         I  Federal Communications Commission (Parts 0--199)
        II  Office of Science and Technology Policy and National 
                Security Council (Parts 200--299)
       III  National Telecommunications and Information 
                Administration, Department of Commerce (Parts 
                300--399)
        IV  National Telecommunications and Information 
                Administration, Department of Commerce, and 
                National Highway Traffic Safety Administration, 
                Department of Transportation (Parts 400--499)

           Title 48--Federal Acquisition Regulations System

         1  Federal Acquisition Regulation (Parts 1--99)
         2  Defense Acquisition Regulations System, Department of 
                Defense (Parts 200--299)
         3  Health and Human Services (Parts 300--399)
         4  Department of Agriculture (Parts 400--499)
         5  General Services Administration (Parts 500--599)
         6  Department of State (Parts 600--699)
         7  Agency for International Development (Parts 700--799)
         8  Department of Veterans Affairs (Parts 800--899)
         9  Department of Energy (Parts 900--999)
        10  Department of the Treasury (Parts 1000--1099)
        12  Department of Transportation (Parts 1200--1299)
        13  Department of Commerce (Parts 1300--1399)
        14  Department of the Interior (Parts 1400--1499)
        15  Environmental Protection Agency (Parts 1500--1599)
        16  Office of Personnel Management, Federal Employees 
                Health Benefits Acquisition Regulation (Parts 
                1600--1699)
        17  Office of Personnel Management (Parts 1700--1799)

[[Page 830]]

        18  National Aeronautics and Space Administration (Parts 
                1800--1899)
        19  Broadcasting Board of Governors (Parts 1900--1999)
        20  Nuclear Regulatory Commission (Parts 2000--2099)
        21  Office of Personnel Management, Federal Employees 
                Group Life Insurance Federal Acquisition 
                Regulation (Parts 2100--2199)
        23  Social Security Administration (Parts 2300--2399)
        24  Department of Housing and Urban Development (Parts 
                2400--2499)
        25  National Science Foundation (Parts 2500--2599)
        28  Department of Justice (Parts 2800--2899)
        29  Department of Labor (Parts 2900--2999)
        30  Department of Homeland Security, Homeland Security 
                Acquisition Regulation (HSAR) (Parts 3000--3099)
        34  Department of Education Acquisition Regulation (Parts 
                3400--3499)
        51  Department of the Army Acquisition Regulations (Parts 
                5100--5199)
        52  Department of the Navy Acquisition Regulations (Parts 
                5200--5299)
        53  Department of the Air Force Federal Acquisition 
                Regulation Supplement [Reserved]
        54  Defense Logistics Agency, Department of Defense (Parts 
                5400--5499)
        57  African Development Foundation (Parts 5700--5799)
        61  Civilian Board of Contract Appeals, General Services 
                Administration (Parts 6100--6199)
        63  Department of Transportation Board of Contract Appeals 
                (Parts 6300--6399)
        99  Cost Accounting Standards Board, Office of Federal 
                Procurement Policy, Office of Management and 
                Budget (Parts 9900--9999)

                       Title 49--Transportation

            Subtitle A--Office of the Secretary of Transportation 
                (Parts 1--99)
            Subtitle B--Other Regulations Relating to 
                Transportation
         I  Pipeline and Hazardous Materials Safety 
                Administration, Department of Transportation 
                (Parts 100--199)
        II  Federal Railroad Administration, Department of 
                Transportation (Parts 200--299)
       III  Federal Motor Carrier Safety Administration, 
                Department of Transportation (Parts 300--399)
        IV  Coast Guard, Department of Homeland Security (Parts 
                400--499)
         V  National Highway Traffic Safety Administration, 
                Department of Transportation (Parts 500--599)
        VI  Federal Transit Administration, Department of 
                Transportation (Parts 600--699)

[[Page 831]]

       VII  National Railroad Passenger Corporation (AMTRAK) 
                (Parts 700--799)
      VIII  National Transportation Safety Board (Parts 800--999)
         X  Surface Transportation Board, Department of 
                Transportation (Parts 1000--1399)
        XI  Research and Innovative Technology Administration, 
                Department of Transportation [Reserved]
       XII  Transportation Security Administration, Department of 
                Homeland Security (Parts 1500--1699)

                   Title 50--Wildlife and Fisheries

         I  United States Fish and Wildlife Service, Department of 
                the Interior (Parts 1--199)
        II  National Marine Fisheries Service, National Oceanic 
                and Atmospheric Administration, Department of 
                Commerce (Parts 200--299)
       III  International Fishing and Related Activities (Parts 
                300--399)
        IV  Joint Regulations (United States Fish and Wildlife 
                Service, Department of the Interior and National 
                Marine Fisheries Service, National Oceanic and 
                Atmospheric Administration, Department of 
                Commerce); Endangered Species Committee 
                Regulations (Parts 400--499)
         V  Marine Mammal Commission (Parts 500--599)
        VI  Fishery Conservation and Management, National Oceanic 
                and Atmospheric Administration, Department of 
                Commerce (Parts 600--699)

                      CFR Index and Finding Aids

            Subject/Agency Index
            List of Agency Prepared Indexes
            Parallel Tables of Statutory Authorities and Rules
            List of CFR Titles, Chapters, Subchapters, and Parts
            Alphabetical List of Agencies Appearing in the CFR

[[Page 833]]





           Alphabetical List of Agencies Appearing in the CFR




                      (Revised as of April 1, 2012)

                                                  CFR Title, Subtitle or 
                     Agency                               Chapter

Administrative Committee of the Federal Register  1, I
Administrative Conference of the United States    1, III
Advisory Council on Historic Preservation         36, VIII
Advocacy and Outreach, Office of                  7, XXV
African Development Foundation                    22, XV
  Federal Acquisition Regulation                  48, 57
Agency for International Development              2, VII; 22, II
  Federal Acquisition Regulation                  48, 7
Agricultural Marketing Service                    7, I, IX, X, XI
Agricultural Research Service                     7, V
Agriculture Department                            2, IV; 5, LXXIII
  Advocacy and Outreach, Office of                7, XXV
  Agricultural Marketing Service                  7, I, IX, X, XI
  Agricultural Research Service                   7, V
  Animal and Plant Health Inspection Service      7, III; 9, I
  Chief Financial Officer, Office of              7, XXX
  Commodity Credit Corporation                    7, XIV
  Economic Research Service                       7, XXXVII
  Energy Policy and New Uses, Office of           2, IX; 7, XXIX
  Environmental Quality, Office of                7, XXXI
  Farm Service Agency                             7, VII, XVIII
  Federal Acquisition Regulation                  48, 4
  Federal Crop Insurance Corporation              7, IV
  Food and Nutrition Service                      7, II
  Food Safety and Inspection Service              9, III
  Foreign Agricultural Service                    7, XV
  Forest Service                                  36, II
  Grain Inspection, Packers and Stockyards        7, VIII; 9, II
       Administration
  Information Resources Management, Office of     7, XXVII
  Inspector General, Office of                    7, XXVI
  National Agricultural Library                   7, XLI
  National Agricultural Statistics Service        7, XXXVI
  National Institute of Food and Agriculture      7, XXXIV
  Natural Resources Conservation Service          7, VI
  Operations, Office of                           7, XXVIII
  Procurement and Property Management, Office of  7, XXXII
  Rural Business-Cooperative Service              7, XVIII, XLII, L
  Rural Development Administration                7, XLII
  Rural Housing Service                           7, XVIII, XXXV, L
  Rural Telephone Bank                            7, XVI
  Rural Utilities Service                         7, XVII, XVIII, XLII, L
  Secretary of Agriculture, Office of             7, Subtitle A
  Transportation, Office of                       7, XXXIII
  World Agricultural Outlook Board                7, XXXVIII
Air Force Department                              32, VII
  Federal Acquisition Regulation Supplement       48, 53
Air Transportation Stabilization Board            14, VI
Alcohol and Tobacco Tax and Trade Bureau          27, I
Alcohol, Tobacco, Firearms, and Explosives,       27, II
     Bureau of
AMTRAK                                            49, VII
American Battle Monuments Commission              36, IV
American Indians, Office of the Special Trustee   25, VII
Animal and Plant Health Inspection Service        7, III; 9, I

[[Page 834]]

Appalachian Regional Commission                   5, IX
Architectural and Transportation Barriers         36, XI
     Compliance Board
Arctic Research Commission                        45, XXIII
Armed Forces Retirement Home                      5, XI
Army Department                                   32, V
  Engineers, Corps of                             33, II; 36, III
  Federal Acquisition Regulation                  48, 51
Bilingual Education and Minority Languages        34, V
     Affairs, Office of
Blind or Severely Disabled, Committee for         41, 51
     Purchase from People Who Are
Broadcasting Board of Governors                   22, V
  Federal Acquisition Regulation                  48, 19
Bureau of Ocean Energy Management, Regulation,    30, II
     and Enforcement
Census Bureau                                     15, I
Centers for Medicare & Medicaid Services          42, IV
Central Intelligence Agency                       32, XIX
Chemical Safety and Hazardous Investigation       40, VI
     Board
Chief Financial Officer, Office of                7, XXX
Child Support Enforcement, Office of              45, III
Children and Families, Administration for         45, II, III, IV, X
Civil Rights, Commission on                       5, LXVIII; 45, VII
Civil Rights, Office for                          34, I
Court Services and Offender Supervision Agency    5, LXX
     for the District of Columbia
Coast Guard                                       33, I; 46, I; 49, IV
Coast Guard (Great Lakes Pilotage)                46, III
Commerce Department                               2, XIII; 44, IV; 50, VI
  Census Bureau                                   15, I
  Economic Affairs, Under Secretary               37, V
  Economic Analysis, Bureau of                    15, VIII
  Economic Development Administration             13, III
  Emergency Management and Assistance             44, IV
  Federal Acquisition Regulation                  48, 13
  Foreign-Trade Zones Board                       15, IV
  Industry and Security, Bureau of                15, VII
  International Trade Administration              15, III; 19, III
  National Institute of Standards and Technology  15, II
  National Marine Fisheries Service               50, II, IV
  National Oceanic and Atmospheric                15, IX; 50, II, III, IV, 
       Administration                             VI
  National Telecommunications and Information     15, XXIII; 47, III, IV
       Administration
  National Weather Service                        15, IX
  Patent and Trademark Office, United States      37, I
  Productivity, Technology and Innovation,        37, IV
       Assistant Secretary for
  Secretary of Commerce, Office of                15, Subtitle A
  Technology, Under Secretary for                 37, V
  Technology Administration                       15, XI
  Technology Policy, Assistant Secretary for      37, IV
Commercial Space Transportation                   14, III
Commodity Credit Corporation                      7, XIV
Commodity Futures Trading Commission              5, XLI; 17, I
Community Planning and Development, Office of     24, V, VI
     Assistant Secretary for
Community Services, Office of                     45, X
Comptroller of the Currency                       12, I
Construction Industry Collective Bargaining       29, IX
     Commission
Consumer Financial Protection Bureau              12, X
Consumer Product Safety Commission                5, LXXI; 16, II
Copyright Office                                  37, II
Copyright Royalty Board                           37, III
Corporation for National and Community Service    2, XXII; 45, XII, XXV
Cost Accounting Standards Board                   48, 99
Council on Environmental Quality                  40, V
Court Services and Offender Supervision Agency    5, LXX; 28, VIII
   for the District of Columbia
[[Page 835]]

Customs and Border Protection                     19, I
Defense Contract Audit Agency                     32, I
Defense Department                                2, XI; 5, XXVI; 32, 
                                                  Subtitle A; 40, VII
  Advanced Research Projects Agency               32, I
  Air Force Department                            32, VII
  Army Department                                 32, V; 33, II; 36, III, 
                                                  48, 51
  Defense Acquisition Regulations System          48, 2
  Defense Intelligence Agency                     32, I
  Defense Logistics Agency                        32, I, XII; 48, 54
  Engineers, Corps of                             33, II; 36, III
  National Imagery and Mapping Agency             32, I
  Navy Department                                 32, VI; 48, 52
  Secretary of Defense, Office of                 2, XI; 32, I
Defense Contract Audit Agency                     32, I
Defense Intelligence Agency                       32, I
Defense Logistics Agency                          32, XII; 48, 54
Defense Nuclear Facilities Safety Board           10, XVII
Delaware River Basin Commission                   18, III
District of Columbia, Court Services and          5, LXX; 28, VIII
     Offender Supervision Agency for the
Drug Enforcement Administration                   21, II
East-West Foreign Trade Board                     15, XIII
Economic Affairs, Under Secretary                 37, V
Economic Analysis, Bureau of                      15, VIII
Economic Development Administration               13, III
Economic Research Service                         7, XXXVII
Education, Department of                          2, XXXIV; 5, LIII
  Bilingual Education and Minority Languages      34, V
       Affairs, Office of
  Civil Rights, Office for                        34, I
  Educational Research and Improvement, Office    34, VII
       of
  Elementary and Secondary Education, Office of   34, II
  Federal Acquisition Regulation                  48, 34
  Postsecondary Education, Office of              34, VI
  Secretary of Education, Office of               34, Subtitle A
  Special Education and Rehabilitative Services,  34, III
       Office of
  Vocational and Adult Education, Office of       34, IV
Educational Research and Improvement, Office of   34, VII
Election Assistance Commission                    2, LVIII; 11, II
Elementary and Secondary Education, Office of     34, II
Emergency Oil and Gas Guaranteed Loan Board       13, V
Emergency Steel Guarantee Loan Board              13, IV
Employee Benefits Security Administration         29, XXV
Employees' Compensation Appeals Board             20, IV
Employees Loyalty Board                           5, V
Employment and Training Administration            20, V
Employment Standards Administration               20, VI
Endangered Species Committee                      50, IV
Energy, Department of                             2, IX; 5, XXIII; 10, II, 
                                                  III, X
  Federal Acquisition Regulation                  48, 9
  Federal Energy Regulatory Commission            5, XXIV; 18, I
  Property Management Regulations                 41, 109
Energy, Office of                                 7, XXIX
Engineers, Corps of                               33, II; 36, III
Engraving and Printing, Bureau of                 31, VI
Environmental Protection Agency                   2, XV; 5, LIV; 40, I, IV, 
                                                  VII
  Federal Acquisition Regulation                  48, 15
  Property Management Regulations                 41, 115
Environmental Quality, Office of                  7, XXXI
Equal Employment Opportunity Commission           5, LXII; 29, XIV
Equal Opportunity, Office of Assistant Secretary  24, I
     for
Executive Office of the President                 3, I
  Administration, Office of                       5, XV

[[Page 836]]

  Environmental Quality, Council on               40, V
  Management and Budget, Office of                2, Subtitle A; 5, III, 
                                                  LXXVII; 14, VI; 48, 99
  National Drug Control Policy, Office of         21, III
  National Security Council                       32, XXI; 47, 2
  Presidential Documents                          3
  Science and Technology Policy, Office of        32, XXIV; 47, II
  Trade Representative, Office of the United      15, XX
       States
Export-Import Bank of the United States           2, XXXV; 5, LII; 12, IV
Family Assistance, Office of                      45, II
Farm Credit Administration                        5, XXXI; 12, VI
Farm Credit System Insurance Corporation          5, XXX; 12, XIV
Farm Service Agency                               7, VII, XVIII
Federal Acquisition Regulation                    48, 1
Federal Aviation Administration                   14, I
  Commercial Space Transportation                 14, III
Federal Claims Collection Standards               31, IX
Federal Communications Commission                 5, XXIX; 47, I
Federal Contract Compliance Programs, Office of   41, 60
Federal Crop Insurance Corporation                7, IV
Federal Deposit Insurance Corporation             5, XXII; 12, III
Federal Election Commission                       5, XXXVII; 11, I
Federal Emergency Management Agency               44, I
Federal Employees Group Life Insurance Federal    48, 21
     Acquisition Regulation
Federal Employees Health Benefits Acquisition     48, 16
     Regulation
Federal Energy Regulatory Commission              5, XXIV; 18, I
Federal Financial Institutions Examination        12, XI
     Council
Federal Financing Bank                            12, VIII
Federal Highway Administration                    23, I, II
Federal Home Loan Mortgage Corporation            1, IV
Federal Housing Enterprise Oversight Office       12, XVII
Federal Housing Finance Agency                    5, LXXX; 12, XII
Federal Housing Finance Board                     12, IX
Federal Labor Relations Authority                 5, XIV, XLIX; 22, XIV
Federal Law Enforcement Training Center           31, VII
Federal Management Regulation                     41, 102
Federal Maritime Commission                       46, IV
Federal Mediation and Conciliation Service        29, XII
Federal Mine Safety and Health Review Commission  5, LXXIV; 29, XXVII
Federal Motor Carrier Safety Administration       49, III
Federal Prison Industries, Inc.                   28, III
Federal Procurement Policy Office                 48, 99
Federal Property Management Regulations           41, 101
Federal Railroad Administration                   49, II
Federal Register, Administrative Committee of     1, I
Federal Register, Office of                       1, II
Federal Reserve System                            12, II
  Board of Governors                              5, LVIII
Federal Retirement Thrift Investment Board        5, VI, LXXVI
Federal Service Impasses Panel                    5, XIV
Federal Trade Commission                          5, XLVII; 16, I
Federal Transit Administration                    49, VI
Federal Travel Regulation System                  41, Subtitle F
Financial Crimes Enforcement Network              31, X
Financial Research Office                         12, XVI
Financial Stability Oversight Council             12, XIII
Fine Arts, Commission on                          45, XXI
Fiscal Service                                    31, II
Fish and Wildlife Service, United States          50, I, IV
Food and Drug Administration                      21, I
Food and Nutrition Service                        7, II
Food Safety and Inspection Service                9, III
Foreign Agricultural Service                      7, XV
Foreign Assets Control, Office of                 31, V
Foreign Claims Settlement Commission of the       45, V
     United States
Foreign Service Grievance Board                   22, IX

[[Page 837]]

Foreign Service Impasse Disputes Panel            22, XIV
Foreign Service Labor Relations Board             22, XIV
Foreign-Trade Zones Board                         15, IV
Forest Service                                    36, II
General Services Administration                   5, LVII; 41, 105
  Contract Appeals, Board of                      48, 61
  Federal Acquisition Regulation                  48, 5
  Federal Management Regulation                   41, 102
  Federal Property Management Regulations         41, 101
  Federal Travel Regulation System                41, Subtitle F
  General                                         41, 300
  Payment From a Non-Federal Source for Travel    41, 304
       Expenses
  Payment of Expenses Connected With the Death    41, 303
       of Certain Employees
  Relocation Allowances                           41, 302
  Temporary Duty (TDY) Travel Allowances          41, 301
Geological Survey                                 30, IV
Government Accountability Office                  4, I
Government Ethics, Office of                      5, XVI
Government National Mortgage Association          24, III
Grain Inspection, Packers and Stockyards          7, VIII; 9, II
     Administration
Harry S. Truman Scholarship Foundation            45, XVIII
Health and Human Services, Department of          2, III; 5, XLV; 45, 
                                                  Subtitle A,
  Centers for Medicare & Medicaid Services        42, IV
  Child Support Enforcement, Office of            45, III
  Children and Families, Administration for       45, II, III, IV, X
  Community Services, Office of                   45, X
  Family Assistance, Office of                    45, II
  Federal Acquisition Regulation                  48, 3
  Food and Drug Administration                    21, I
  Human Development Services, Office of           45, XIII
  Indian Health Service                           25, V
  Inspector General (Health Care), Office of      42, V
  Public Health Service                           42, I
  Refugee Resettlement, Office of                 45, IV
Homeland Security, Department of                  2, XXX; 6, I; 8, I
  Coast Guard                                     33, I; 46, I; 49, IV
  Coast Guard (Great Lakes Pilotage)              46, III
  Customs and Border Protection                   19, I
  Federal Emergency Management Agency             44, I
  Human Resources Management and Labor Relations  5, XCVII
       Systems
  Immigration and Customs Enforcement Bureau      19, IV
  Transportation Security Administration          49, XII
HOPE for Homeowners Program, Board of Directors   24, XXIV
     of
Housing and Urban Development, Department of      2, XXIV; 5, LXV; 24, 
                                                  Subtitle B
  Community Planning and Development, Office of   24, V, VI
       Assistant Secretary for
  Equal Opportunity, Office of Assistant          24, I
       Secretary for
  Federal Acquisition Regulation                  48, 24
  Federal Housing Enterprise Oversight, Office    12, XVII
       of
  Government National Mortgage Association        24, III
  Housing--Federal Housing Commissioner, Office   24, II, VIII, X, XX
       of Assistant Secretary for
  Housing, Office of, and Multifamily Housing     24, IV
       Assistance Restructuring, Office of
  Inspector General, Office of                    24, XII
  Public and Indian Housing, Office of Assistant  24, IX
       Secretary for
  Secretary, Office of                            24, Subtitle A, VII
Housing--Federal Housing Commissioner, Office of  24, II, VIII, X, XX
     Assistant Secretary for
Housing, Office of, and Multifamily Housing       24, IV
     Assistance Restructuring, Office of
Human Development Services, Office of             45, XIII
Immigration and Customs Enforcement Bureau        19, IV

[[Page 838]]

Immigration Review, Executive Office for          8, V
Independent Counsel, Office of                    28, VII
Indian Affairs, Bureau of                         25, I, V
Indian Affairs, Office of the Assistant           25, VI
     Secretary
Indian Arts and Crafts Board                      25, II
Indian Health Service                             25, V
Industry and Security, Bureau of                  15, VII
Information Resources Management, Office of       7, XXVII
Information Security Oversight Office, National   32, XX
     Archives and Records Administration
Inspector General
  Agriculture Department                          7, XXVI
  Health and Human Services Department            42, V
  Housing and Urban Development Department        24, XII, XV
Institute of Peace, United States                 22, XVII
Inter-American Foundation                         5, LXIII; 22, X
Interior Department                               2, XIV
  American Indians, Office of the Special         25, VII
       Trustee
  Bureau of Ocean Energy Management, Regulation,  30, II
       and Enforcement
  Endangered Species Committee                    50, IV
  Federal Acquisition Regulation                  48, 14
  Federal Property Management Regulations System  41, 114
  Fish and Wildlife Service, United States        50, I, IV
  Geological Survey                               30, IV
  Indian Affairs, Bureau of                       25, I, V
  Indian Affairs, Office of the Assistant         25, VI
       Secretary
  Indian Arts and Crafts Board                    25, II
  Land Management, Bureau of                      43, II
  National Indian Gaming Commission               25, III
  National Park Service                           36, I
  Natural Resource Revenue, Office of             30, XII
  Ocean Energy Management, Bureau of              30, V
  Reclamation, Bureau of                          43, I
  Secretary of the Interior, Office of            2, XIV; 43, Subtitle A
  Surface Mining Reclamation and Enforcement,     30, VII
       Office of
Internal Revenue Service                          26, I
International Boundary and Water Commission,      22, XI
     United States and Mexico, United States 
     Section
International Development, United States Agency   22, II
     for
  Federal Acquisition Regulation                  48, 7
International Development Cooperation Agency,     22, XII
     United States
International Joint Commission, United States     22, IV
     and Canada
International Organizations Employees Loyalty     5, V
     Board
International Trade Administration                15, III; 19, III
International Trade Commission, United States     19, II
Interstate Commerce Commission                    5, XL
Investment Security, Office of                    31, VIII
Iraq Reconstruction, Special Inspector General    5, LXXXVII
     for
James Madison Memorial Fellowship Foundation      45, XXIV
Japan-United States Friendship Commission         22, XVI
Joint Board for the Enrollment of Actuaries       20, VIII
Justice Department                                2, XXVIII; 5, XXVIII; 28, 
                                                  I, XI; 40, IV
  Alcohol, Tobacco, Firearms, and Explosives,     27, II
       Bureau of
  Drug Enforcement Administration                 21, II
  Federal Acquisition Regulation                  48, 28
  Federal Claims Collection Standards             31, IX
  Federal Prison Industries, Inc.                 28, III
  Foreign Claims Settlement Commission of the     45, V
       United States
  Immigration Review, Executive Office for        8, V
  Offices of Independent Counsel                  28, VI
  Prisons, Bureau of                              28, V
  Property Management Regulations                 41, 128
Labor Department                                  5, XLII

[[Page 839]]

  Employee Benefits Security Administration       29, XXV
  Employees' Compensation Appeals Board           20, IV
  Employment and Training Administration          20, V
  Employment Standards Administration             20, VI
  Federal Acquisition Regulation                  48, 29
  Federal Contract Compliance Programs, Office    41, 60
       of
  Federal Procurement Regulations System          41, 50
  Labor-Management Standards, Office of           29, II, IV
  Mine Safety and Health Administration           30, I
  Occupational Safety and Health Administration   29, XVII
  Office of Workers' Compensation Programs        20, VII
  Public Contracts                                41, 50
  Secretary of Labor, Office of                   29, Subtitle A
  Veterans' Employment and Training Service,      41, 61; 20, IX
       Office of the Assistant Secretary for
  Wage and Hour Division                          29, V
  Workers' Compensation Programs, Office of       20, I
Labor-Management Standards, Office of             29, II, IV
Land Management, Bureau of                        43, II
Legal Services Corporation                        45, XVI
Library of Congress                               36, VII
  Copyright Office                                37, II
  Copyright Royalty Board                         37, III
Local Television Loan Guarantee Board             7, XX
Management and Budget, Office of                  5, III, LXXVII; 14, VI; 
                                                  48, 99
Marine Mammal Commission                          50, V
Maritime Administration                           46, II
Merit Systems Protection Board                    5, II, LXIV
Micronesian Status Negotiations, Office for       32, XXVII
Millennium Challenge Corporation                  22, XIII
Mine Safety and Health Administration             30, I
Minority Business Development Agency              15, XIV
Miscellaneous Agencies                            1, IV
Monetary Offices                                  31, I
Morris K. Udall Scholarship and Excellence in     36, XVI
     National Environmental Policy Foundation
Museum and Library Services, Institute of         2, XXXI
National Aeronautics and Space Administration     2, XVIII; 5, LIX; 14, V
  Federal Acquisition Regulation                  48, 18
National Agricultural Library                     7, XLI
National Agricultural Statistics Service          7, XXXVI
National and Community Service, Corporation for   2, XXII; 45, XII, XXV
National Archives and Records Administration      2, XXVI; 5, LXVI; 36, XII
  Information Security Oversight Office           32, XX
National Capital Planning Commission              1, IV
National Commission for Employment Policy         1, IV
National Commission on Libraries and Information  45, XVII
     Science
National Council on Disability                    34, XII
National Counterintelligence Center               32, XVIII
National Credit Union Administration              12, VII
National Crime Prevention and Privacy Compact     28, IX
     Council
National Drug Control Policy, Office of           21, III
National Endowment for the Arts                   2, XXXII
National Endowment for the Humanities             2, XXXIII
National Foundation on the Arts and the           45, XI
     Humanities
National Highway Traffic Safety Administration    23, II, III; 47, VI; 49, V
National Imagery and Mapping Agency               32, I
National Indian Gaming Commission                 25, III
National Institute for Literacy                   34, XI
National Institute of Food and Agriculture        7, XXXIV
National Institute of Standards and Technology    15, II
National Intelligence, Office of Director of      32, XVII
National Labor Relations Board                    5, LXI; 29, I
National Marine Fisheries Service                 50, II, IV
National Mediation Board                          29, X

[[Page 840]]

National Oceanic and Atmospheric Administration   15, IX; 50, II, III, IV, 
                                                  VI
National Park Service                             36, I
National Railroad Adjustment Board                29, III
National Railroad Passenger Corporation (AMTRAK)  49, VII
National Science Foundation                       2, XXV; 5, XLIII; 45, VI
  Federal Acquisition Regulation                  48, 25
National Security Council                         32, XXI
National Security Council and Office of Science   47, II
     and Technology Policy
National Telecommunications and Information       15, XXIII; 47, III, IV
     Administration
National Transportation Safety Board              49, VIII
Natural Resources Conservation Service            7, VI
Natural Resource Revenue, Office of               30, XII
Navajo and Hopi Indian Relocation, Office of      25, IV
Navy Department                                   32, VI
  Federal Acquisition Regulation                  48, 52
Neighborhood Reinvestment Corporation             24, XXV
Northeast Interstate Low-Level Radioactive Waste  10, XVIII
     Commission
Nuclear Regulatory Commission                     2, XX; 5, XLVIII; 10, I
  Federal Acquisition Regulation                  48, 20
Occupational Safety and Health Administration     29, XVII
Occupational Safety and Health Review Commission  29, XX
Ocean Energy Management, Bureau of                30, V
Offices of Independent Counsel                    28, VI
Office of Workers' Compensation Programs          20, VII
Oklahoma City National Memorial Trust             36, XV
Operations Office                                 7, XXVIII
Overseas Private Investment Corporation           5, XXXIII; 22, VII
Patent and Trademark Office, United States        37, I
Payment From a Non-Federal Source for Travel      41, 304
     Expenses
Payment of Expenses Connected With the Death of   41, 303
     Certain Employees
Peace Corps                                       2, XXXVII; 22, III
Pennsylvania Avenue Development Corporation       36, IX
Pension Benefit Guaranty Corporation              29, XL
Personnel Management, Office of                   5, I, XXXV; 45, VIII
  Human Resources Management and Labor Relations  5, XCVII
       Systems, Department of Homeland Security
  Federal Acquisition Regulation                  48, 17
  Federal Employees Group Life Insurance Federal  48, 21
       Acquisition Regulation
  Federal Employees Health Benefits Acquisition   48, 16
       Regulation
Pipeline and Hazardous Materials Safety           49, I
     Administration
Postal Regulatory Commission                      5, XLVI; 39, III
Postal Service, United States                     5, LX; 39, I
Postsecondary Education, Office of                34, VI
President's Commission on White House             1, IV
     Fellowships
Presidential Documents                            3
Presidio Trust                                    36, X
Prisons, Bureau of                                28, V
Procurement and Property Management, Office of    7, XXXII
Productivity, Technology and Innovation,          37, IV
     Assistant Secretary
Public Contracts, Department of Labor             41, 50
Public and Indian Housing, Office of Assistant    24, IX
     Secretary for
Public Health Service                             42, I
Railroad Retirement Board                         20, II
Reclamation, Bureau of                            43, I
Recovery Accountability and Transparency Board    4, II
Refugee Resettlement, Office of                   45, IV
Relocation Allowances                             41, 302
Research and Innovative Technology                49, XI
     Administration
Rural Business-Cooperative Service                7, XVIII, XLII, L
Rural Development Administration                  7, XLII
Rural Housing Service                             7, XVIII, XXXV, L

[[Page 841]]

Rural Telephone Bank                              7, XVI
Rural Utilities Service                           7, XVII, XVIII, XLII, L
Saint Lawrence Seaway Development Corporation     33, IV
Science and Technology Policy, Office of          32, XXIV
Science and Technology Policy, Office of, and     47, II
     National Security Council
Secret Service                                    31, IV
Securities and Exchange Commission                5, XXXIV; 17, II
Selective Service System                          32, XVI
Small Business Administration                     2, XXVII; 13, I
Smithsonian Institution                           36, V
Social Security Administration                    2, XXIII; 20, III; 48, 23
Soldiers' and Airmen's Home, United States        5, XI
Special Counsel, Office of                        5, VIII
Special Education and Rehabilitative Services,    34, III
     Office of
State Department                                  2, VI; 22, I; 28, XI
  Federal Acquisition Regulation                  48, 6
Surface Mining Reclamation and Enforcement,       30, VII
     Office of
Surface Transportation Board                      49, X
Susquehanna River Basin Commission                18, VIII
Technology Administration                         15, XI
Technology Policy, Assistant Secretary for        37, IV
Technology, Under Secretary for                   37, V
Tennessee Valley Authority                        5, LXIX; 18, XIII
Thrift Supervision Office, Department of the      12, V
     Treasury
Trade Representative, United States, Office of    15, XX
Transportation, Department of                     2, XII; 5, L
  Commercial Space Transportation                 14, III
  Contract Appeals, Board of                      48, 63
  Emergency Management and Assistance             44, IV
  Federal Acquisition Regulation                  48, 12
  Federal Aviation Administration                 14, I
  Federal Highway Administration                  23, I, II
  Federal Motor Carrier Safety Administration     49, III
  Federal Railroad Administration                 49, II
  Federal Transit Administration                  49, VI
  Maritime Administration                         46, II
  National Highway Traffic Safety Administration  23, II, III; 47, IV; 49, V
  Pipeline and Hazardous Materials Safety         49, I
       Administration
  Saint Lawrence Seaway Development Corporation   33, IV
  Secretary of Transportation, Office of          14, II; 49, Subtitle A
  Surface Transportation Board                    49, X
  Transportation Statistics Bureau                49, XI
Transportation, Office of                         7, XXXIII
Transportation Security Administration            49, XII
Transportation Statistics Bureau                  49, XI
Travel Allowances, Temporary Duty (TDY)           41, 301
Treasury Department                               5, XXI; 12, XV; 17, IV; 
                                                  31, IX
  Alcohol and Tobacco Tax and Trade Bureau        27, I
  Community Development Financial Institutions    12, XVIII
       Fund
  Comptroller of the Currency                     12, I
  Customs and Border Protection                   19, I
  Engraving and Printing, Bureau of               31, VI
  Federal Acquisition Regulation                  48, 10
  Federal Claims Collection Standards             31, IX
  Federal Law Enforcement Training Center         31, VII
  Financial Crimes Enforcement Network            31, X
  Fiscal Service                                  31, II
  Foreign Assets Control, Office of               31, V
  Internal Revenue Service                        26, I
  Investment Security, Office of                  31, VIII
  Monetary Offices                                31, I
  Secret Service                                  31, IV
  Secretary of the Treasury, Office of            31, Subtitle A
  Thrift Supervision, Office of                   12, V
Truman, Harry S. Scholarship Foundation           45, XVIII

[[Page 842]]

United States and Canada, International Joint     22, IV
     Commission
United States and Mexico, International Boundary  22, XI
     and Water Commission, United States Section
Utah Reclamation Mitigation and Conservation      43, III
     Commission
Veterans Affairs Department                       2, VIII; 38, I
  Federal Acquisition Regulation                  48, 8
Veterans' Employment and Training Service,        41, 61; 20, IX
     Office of the Assistant Secretary for
Vice President of the United States, Office of    32, XXVIII
Vocational and Adult Education, Office of         34, IV
Wage and Hour Division                            29, V
Water Resources Council                           18, VI
Workers' Compensation Programs, Office of         20, I
World Agricultural Outlook Board                  7, XXXVIII

[[Page 843]]



List of CFR Sections Affected



All changes in this volume of the Code of Federal Regulations that were 
made by documents published in the Federal Register since January 1, 
2001, are enumerated in the following list. Entries indicate the nature 
of the changes effected. Page numbers refer to Federal Register pages. 
The user should consult the entries for chapters and parts as well as 
sections for revisions.
For the period before January 1, 2001, see the ``List of CFR Sections 
Affected, 1949-1963, 1964-1972, 1973-1985, and 1986-2000,'' published in 
11 separate volumes.

                                  2001

20 CFR
                                                                   66 FR
                                                                    Page
Chapter V
625.5 (c) added; interim...........................................56962
645 Revised; interim................................................2711
    Regulation at 66 FR 2711 eff. date delayed to 4-13-01; interim
                                                                    9763
655.0 Regulation at 65 FR 43542 and 67628 eff. date delayed to 9-
        27-02......................................................49275
    Regulation at 66 FR 49275 eff. date correctly extended to 9-
27-02..............................................................51095
655.00 Regulation at 65 FR 43542 and 67628 eff. date delayed to 9-
        27-02......................................................49275
    Regulation at 66 FR 49275 eff. date correctly extended to 9-
27-02..............................................................51095
655.90--655.113 (Subpart B) Regulation at 65 FR 43542 and 67628 
        eff. date delayed to 9-27-02...............................49275
    Regulation at 66 FR 49275 eff. date correctly extended to 9-
27-02..............................................................51095
655.92 Regulation at 65 FR 43542 and 67628 eff. date delayed to 9-
        27-02......................................................49275
    Regulation at 66 FR 49275 eff. date correctly extended to 9-
27-02..............................................................51095
655.100 Regulation at 65 FR 43543 and 67628 eff. date delayed to 
        9-27-02....................................................49275
    Regulation at 66 FR 49275 eff. date correctly extended to 9-
27-02..............................................................51095
655.101 Regulation at 65 FR 43543 and 67628 eff. date delayed to 
        9-27-02....................................................49275
    Regulation at 66 FR 49275 eff. date correctly extended to 9-
27-02..............................................................51095
655.103 Regulation at 65 FR 43543 and 67628 eff. date delayed to 
        9-27-02....................................................49275
    Regulation at 66 FR 49275 eff. date correctly extended to 9-
27-02..............................................................51095
655.104 Regulation at 65 FR 43543 and 67628 eff. date delayed to 
        9-27-02....................................................49275
    Regulation at 66 FR 49275 eff. date correctly extended to 9-
27-02..............................................................51095
655.105 Regulation at 65 FR 43543 and 67628 eff. date delayed to 
        9-27-02....................................................49275
    Regulation at 66 FR 49275 eff. date correctly extended to 9-
27-02..............................................................51095
655.106 Regulation at 65 FR 43543 and 67628 eff. date delayed to 
        9-27-02....................................................49275
    Regulation at 66 FR 49275 eff. date correctly extended to 9-
27-02..............................................................51095
655.108 Regulation at 65 FR 43544 and 67628 eff. date delayed to 
        9-27-02....................................................49275
    Regulation at 66 FR 49275 eff. date correctly extended to 9-
27-02..............................................................51095

[[Page 844]]

655.112 Regulation at 65 FR 43544 and 67628 eff. date delayed to 
        9-27-02....................................................49275
    Regulation at 66 FR 49275 eff. date correctly extended to 9-
27-02..............................................................51095
655.114 Regulation at 65 FR 43544 and 67628 eff. date delayed to 
        9-27-02....................................................49275
    Regulation at 66 FR 49275 eff. date correctly extended to 9-
27-02..............................................................51095
655.700 OMB number.................................................10814
    (b)(1) amended.................................................63300
655.705 (c) revised................................................63300
655.720 Revised....................................................63301
655.730 (b) and (c)(1) introductory text revised...................63301
655.731 OMB number.................................................10814
    Introductory text, (a) and (b)(1) amended......................63302
655.732 Introductory text amended..................................63302
655.733 Introductory text amended..................................63302
655.734 Introductory text and (b) amended; (a)(3) revised..........63302
655.736 (b)(2)(iii) corrected.......................................1375
    OMB number.....................................................10814
    (e) amended....................................................63302
655.737 OMB number.................................................10814
655.738 OMB number.................................................10814
655.739 OMB number.................................................10814
655.740 (a)(1) amended; (a)(2)(i) and (ii) revised.................63302
655.750 (a) revised................................................63302
655.760 OMB number.................................................10814
    (a)(1) revised.................................................63302
655.700--655.760 (Subpart H) Appendix A correctly removed..........10814
655.805 (d) revised................................................63302
656 Authority citation revised.....................................40590
656.21 (i)(6) added................................................40590

                                  2002

20 CFR
                                                                   67 FR
                                                                    Page
Chapter V
655 Regulation at 65 FR 43542 withdrawn............................59779
655.0 Regulation at 65 FR 43542 withdrawn..........................59779
655.00 Regulation at 65 FR 43542 withdrawn.........................59779
655.90--655.114 (Subpart B) Regulation at 65 FR 43542 withdrawn....59779
655.90 Regulation at 65 FR 43542 withdrawn.........................59779
655.92 Regulation at 65 FR 43542 withdrawn.........................59779
655.100 Regulation at 65 FR 43543 withdrawn........................59779
655.101 Regulation at 65 FR 43543 withdrawn........................59779
655.103 Regulation at 65 FR 43543 withdrawn........................59779
655.104 Regulation at 65 FR 43543 withdrawn........................59779
655.105 Regulation at 65 FR 43543 withdrawn........................59779
655.106 Regulation at 65 FR 43543 and 43544 withdrawn..............59779
655.108 Regulation at 65 FR 43544 withdrawn........................59779
655.112 Regulation at 65 FR 43544 withdrawn........................59779
655.114 Regulation at 65 FR 43544 withdrawn........................59779

                                  2003

20 CFR
                                                                   68 FR
                                                                    Page
Chapter V
604 Removed........................................................58549
625.5 Regulation at 66 FR 56962 confirmed; (c)(2) and (3) revised; 
        eff. in part 4-7-03........................................10937

                                  2004

20 CFR
                                                                   69 FR
                                                                    Page
Chapter V
641 Revised........................................................19051
655 Authority citation revised.....................................68226
655.0 (d) revised; interim.........................................68226
655.700--655.760 (Subpart H) Heading revised; interim..............68226
655.700 Heading and (a) introductory text revised; introductory 
        text, (c)(3) and (d) added; interim........................68226
655.715 Amended; interim...........................................68228
655.730 Introductory text added; interim...........................68228
655.731 (c)(10)(i)(C) and (ii) amended; interim....................68228

[[Page 845]]

    (a)(2), (d)(1), (2) introductory text and (i) revised; 
(b)(3)(iii)(B)(2), (3), (C)(2) and (3) redesignated as 
(b)(3)(iii)(B)(3), (4), (C)(3) and (4); new (b)(3)(iii)(B)(2) and 
(C)(2) added; (d)(4) removed.......................................77384
655.740 (a)(2)(ii) amended; interim................................68228
655.760 (b) revised; interim.......................................68228
655.800--655.855 (Subpart I) Heading revised; interim..............68228
655.800 (a) and (c) amended; interim...............................68228
655.801 (a)(1), (2), (b) and (c) amended; interim..................68229
655.805 (c) amended; interim.......................................68229
655.810 (b)(1)(vi) and (c)(4) amended; interim.....................68229
656 Revised........................................................77386
656.24a Added; interim.............................................43718

                                  2005

20 CFR
                                                                   70 FR
                                                                    Page
Chapter V
646 Removed........................................................40870
655.700 (b)(1) revised; (d)(1) amended.............................72560
655.705 Heading, (c) introductory text and (1) revised.............72560
655.710 (b) revised................................................72561
655.715 Amended....................................................72561
655.720 Revised....................................................72561
655.721 Removed....................................................72562
655.730 (b), (c) and (d)(5) revised................................72562
655.734 (a)(1)(ii) amended.........................................72563
655.736 (c) introductory text, (g)(2) and (4) revised; (g)(1) 
        amended....................................................72563
655.740 (a) introductory text, (1) and (3) amended.................72563
655.750 (a) and (b)(2) revised.....................................72563
655.760 (a)(1) revised.............................................72563

                                  2006

20 CFR
                                                                   71 FR
                                                                    Page
Chapter V
601.1 (a), (b) and (c) amended.....................................35513
601.2 Introductory text, (a), (c) and (d) amended; (b) removed.....35513
601.3 Introductory text and (a) amended; (b) removed...............35513
601.4 (a) amended..................................................35513
601.5 (a)(2), (3), (4), (b), (c) and (d) amended; (f) removed......35513
601.6 Heading, introductory text, (a), (b) and (c) amended; (b) 
        and undesignated text redesignated as (b)(1) and (2).......35513
601.9 Amended......................................................35513
602.1 Amended......................................................35513
602.2 Amended......................................................35513
602.10 (d)(1) and (2) amended......................................35513
602.21 (c) introductory text and (3) amended.......................35513
602.40 (b) amended.................................................35513
602.43 Amended.....................................................35513
603 Revised........................................................56842
603.2 (a) and (d)(1) amended.......................................35513
603.9 Removed......................................................35513
603.20 Removed.....................................................35513
606.3 (c)(2) amended...............................................35513
606.4 (a) amended...........................................35513, 35514
606.5 Amended......................................................35513
606.6 Amended...............................................35513, 35514
606.20 (a) introductory text amended...............................35513
606.22 (a)(2) amended..............................................35513
606.23 (a) introductory text, (1)(i), (2), (3) and (b)(2) amended 
                                                                   35513
606.24 (a)(2) amended..............................................35513
606.25 Amended.....................................................35513
606.26 (b) amended.................................................35513
606.30 Amended.....................................................35514
606.41 (a) and (e)(2) amended......................................35513
606.42 (c)(2) amended..............................................35513
606.43 Removed.....................................................35514
606.44 Amended.....................................................35513
609.2 (f)(12)(iii) and (o)(1) amended..............................35514
609.6 (e)(2) amended...............................................35514
609.7 (c)(2) amended...............................................35514
609.13 (b) amended.................................................35514
614.6 (g) amended..................................................35514
615.2 (k)(3) amended...............................................35514
615.5 (a)(1)(iii) amended..........................................35514
615.8 (e)(1), (2), (3), (6), (f)(1) introductory text, (2)(ii), 
        (iii) and (h) introductory text amended....................35514
615.14 (b)(1)(i), (ii), (2), (c)(3) introductory text, (4) and (5) 
        amended; (c)(3)(i) removed; (c)(3)(ii) and (iii) 
        redesignated as (c)(3)(i) and (ii).........................35514
616 Authority citation revised.....................................35514
616.2 Amended......................................................35514
616.6 (a) and (e)(2) revised.......................................35514

[[Page 846]]

616.7 (a) introductory text, (2), Footnote 1, (b) introductory 
        text, (1), (2), (c), (d) introductory text, (2) and (e) 
        amended....................................................35514
    (b)(1), (d) introductory text and (e) amended..................35515
616.8 (a), (b), (c)(2), (d)(1), (2), (e), (f)(4) and (5) amended 
                                                                   35515
616.11 Amended.....................................................35515
617.3 (m)(1), (t)(2) and (3)(i) revised; (q)(3), (ii) and (jj) 
        amended....................................................35515
617.11 (a)(1), (3) and (4) removed; (a)(2) introductory text, 
        (b)(1) and (2) amended.....................................35515
617.19 (a)(1)(i), (ii), (b)(1)(i)(A)(3) and undesignated text 
        amended....................................................35515
617.20 (b)(15) amended.............................................35515
617.22 (a)(4) heading amended......................................35515
617.23 (a) and (d)(2) amended......................................35515
617.24 (b) and (c) amended.........................................35515
617.27 (a) amended.................................................35516
617.49 (b)(1) and (e) amended......................................35516
617.59 (h) amended.................................................35516
617.62 Removed.....................................................35516
617.63 Removed.....................................................35516
617.65 Removed.....................................................35516
617.66 Removed.....................................................35516
617.67 Removed.....................................................35516
625.2 (f) amended..................................................35516
625.6 (d) amended..................................................35516
625.10 (b)(2), (c)(5), (d)(1), (2), (4) and (6) amended............35516
625.11 Heading amended.............................................35516
625.14 (c) amended.................................................35516
625.20 Removed.....................................................35516
625.30 (h)(1) amended..............................................35516
640.1 (a)(1) and (b)(1) amended....................................35516
640.5 Table revised................................................35516
641.490 (b) revised................................................35516
641.690 (a)(3) amended.............................................35517
641.700 (b) amended................................................35517
641.710 (b)(9) revised.............................................35517
641.715 (c) revised................................................35517
641.800 (c) amended................................................35517
650.4 (a), (b) and Footnote 1 amended; (c) removed.................35517
650.5 Amended......................................................35517
651.10 Amended.....................................................35517
653.103 (d) amended................................................35517
653.107 (c)(1)(iv) and (d) introductory text amended...............35518
653.108 (d)(1) and (k) amended.....................................35518
653.109 (a) amended................................................35518
653.111 (d) and (f) amended........................................35518
653.501 (j) amended................................................35518
654.5 (b) amended..................................................35518
654.8 Introductory text amended....................................35518
655 Regulation at 69 FR 68226 confirmed............................37804
655.0 Regulation at 69 FR 68226 confirmed..........................37804
655.00 Revised.....................................................35518
655.2 Amended......................................................35518
655.3 (a) and (d) amended..........................................35518
    (c) and (d) amended............................................35521
655.4 Amended......................................................35521
655.92 Revised.....................................................35518
655.93 (b) amended.................................................35518
    (b) and (c) amended............................................35521
655.100 (a)(1) and (b) amended..............................35518, 35521
    (a)(1), (2), (3), (4)(i), (ii), (iii)(A), (B) and (b) amended 
                                                                   35222
655.101 (a)(1) amended; (c)(5) removed.............................35519
    (a)(1), (3), (c) introductory text, (1) through (4), (d), (e), 
(f)(1), (2) and (g) amended........................................35522
655.102 (b)(4) amended.............................................35521
    (b)(1)(iii), (2), (3), (4), (6)(iv), (9)(ii)(B)(1), (2), (11) 
and (c) amended....................................................35522
655.103 (c), (d)(2) introductory text, (ii), (f) and (h)(2) 
        amended....................................................35522
655.104 (a) and (b) heading revised................................35519
    (b), (c) introductory text, (2), (3) and (e) amended...........35522
655.105 (b), (c) and (d) amended...................................35519
    (a), (c), (d) and (e) amended..................................35522
655.106 (b)(1)(v), (e)(1)(i), (ii)(A) and (B) amended; (h)(3) 
        heading revised............................................35519
    (c)(3)(i) and (ii) amended.....................................35521
    (b)(1) introductory text, (iii), (v), (2)(ii), (c)(1), 
(3)(ii), (d), (f)(1)(i), (iii), (2), (g)(1), (2), (3), (4), 
(h)(1), (2) introductory text, (i), (ii), (3)(i), (ii) and (iii) 
amended............................................................35522
655.107 (a) and (b) amended........................................35521
655.108 (a) and (c) amended........................................35521
    (a), (b) and (c) amended.......................................35522
655.110 (a) and (c)(2) amended.....................................35519
    (a), (b), (c)(1), (2), (d), (e), (f), (g)(1) introductory text 
and (ii) amended...................................................35522
655.111 (a) amended................................................35521

[[Page 847]]

    (a) and (b) amended............................................35522
655.112 (a)(2) and (b)(2) amended...........................35519, 35521
    (a)(1), (2), (b)(1) introductory text and (2) amended..........35522
655.200 (b) and (c) amended..........................35519, 35521, 35522
655.201 (c) and (e) amended........................................35521
    (a)(1), (c), (d) and (e) amended...............................35522
655.202 (b) introductory text, (4), (9)(ii)(B)(1), (2) and (12) 
        amended....................................................35522
655.203 (d)(2)(ii) and (f) amended.................................35522
655.204 (d) introductory text and (2) amended......................35519
    (d)(2), (3)(i) and (ii) amended................................35521
    (a), (b), (c), (d) introductory text, (2), (3) introductory 
text, (i) and (ii) amended.........................................35522
655.205 (a), (b) and (c) amended...................................35519
    (a) through (d) amended........................................35522
655.206 (d)(2) amended.............................................35519
    (a) and (c) amended............................................35522
655.207 (b)(1) amended.............................................35522
655.208 (a) and (c) amended........................................35521
    (a) and (b) amended............................................35522
655.209 Amended.............................................35520, 35521
655.210 (a) amended................................................35522
655.211 (a) amended................................................35522
655.212 (a) and (b) amended.................................35520, 35521
    (b) amended....................................................35522
655.215 Amended....................................................35521
655.500 (a)(2) amended.............................................35520
655.501 (b)(1) and (2) amended.....................................35521
655.502 Amended.............................................35520, 35521
655.510 (b)(1), (c)(1), (g) introductory text, (h) and (j)(1) 
        amended....................................................35520
    (g)(1)(i) and (2)(vii) amended.................................35521
    (i)(1) and (2) amended.........................................35522
655.533 (a) amended................................................35520
655.538 (a)(1) and (b)(6) amended..................................35521
    Introductory text amended......................................35522
655.539 Amended....................................................35522
655.540 (a) and (b) amended........................................35522
655.541 (a) amended................................................35522
655.625 (d)(5) amended.............................................35522
655.665 Heading amended............................................35520
    (a) introductory text, (1), (b) introductory text, (c) 
introductory text and (d)(1) amended...............................35522
655.670 (a), (c), (d) introductory text, (1) and (2) amended.......35522
655.700--655.760 (Subpart H) Regulation at 69 FR 68226 confirmed 
                                                                   37804
655.700 (d)(1) amended......................................35520, 37804
    (a)(3), (b)(2), (3), (c)(2) and (d)(1) amended.................35521
    Regulation at 69 FR 68226 confirmed............................37804
655.705 Introductory text, (a)(1) and (b) amended..................35520
    (b), (c)(3) and (4) amended....................................35521
655.715 Amended....................................................35520
    Regulation at 69 FR 68228 confirmed............................37804
655.730 (e)(1) introductory text and (iii) amended.................35521
    Regulation at 69 FR 68228 confirmed............................37804
655.731 (a)(2) introductory text, (ii)(A), (1), (2), (3), (B), 
        (b)(3)(iii)(A), (c)(6)(ii), (7)(i), (ii), (d)(2) 
        introductory text and (3) amended..........................35521
    Regulation at 69 FR 68228 confirmed............................37804
655.733 Introductory text, (a) introductory text and (2) amended 
                                                                   35521
655.736 (d) introductory text amended..............................35521
655.737 (d)(1) and (e)(1) amended..................................35521
655.740 (a)(1) amended.............................................35521
    Regulation at 69 FR 68228 confirmed............................37804
655.750 (b)(5) and (c)(2) amended..................................35521
655.760 (a)(7) and (b) amended.....................................35521
    Regulation at 69 FR 68228 confirmed............................37804
655.800--655.855 (Subpart I) Regulation at 69 FR 68228 confirmed 
                                                                   37804
655.800 Regulation at 69 FR 68228 confirmed........................37804
655.801 (a)(1) and (c) amended.....................................35521
    Regulation at 69 FR 68229 confirmed............................37804
655.805 (a)(11) and (d) amended....................................35521
    Regulation at 69 FR 68229 confirmed............................37804
655.807 (e) amended................................................35522
655.810 (d) introductory text amended..............................35522
    Regulation at 69 FR 68229 confirmed............................37804

[[Page 848]]

655.815 (c)(5) amended.............................................35522
655.855 Heading, (a), (b) introductory text, (c) and (d) amended 
                                                                   35522
656.1 (c) amended..................................................35522
656.3 Amended......................................................35522
656.10 (d)(5) amended..............................................35523
656.16 (b)(2) amended..............................................35523
656.20 (b) amended.................................................35523
656.24 (a) revised.................................................35523

                                  2007

20 CFR
                                                                   72 FR
                                                                    Page
Chapter V
604 Added...........................................................1893
641.140 Amended; interim...........................................35845
641.700--641.750 (Subpart G) Revised; interim......................35846
656 Authority citation revised.....................................27944
656.3 Amended......................................................27944
656.11 Added.......................................................27944
656.12 Added.......................................................27945
656.24 (g) revised.................................................27945
656.26 (a) revised; (c) added......................................27945
656.30 (a), (b) and (c) revised; (e)(3) added......................27946
656.31 Revised.....................................................27946

                                  2008

20 CFR
                                                                   73 FR
                                                                    Page
Chapter IV
501 Revised........................................................62193
Chapter V
616 Authority citation revised.....................................63072
616.5 Removed......................................................63072
616.6 (e) revised..................................................63072
616.7 (f) added....................................................63072
616.8 (a) amended..................................................63072
655 Authority citation amended.....................................19947
    Authority citation and heading revised..................77207, 78052
655.0 (d) revised..................................................19947
655.1--655.80 (Subpart A) Revised..................................78052
655.1 Revised......................................................77207
655.90--655.119 (Subpart B) Revised................................77207
655.200--655.215 (Subpart C) Removed...............................77229
655.700--655.760 (Subpart H) Heading revised.......................19947
655.700 Heading, introductory text, (c)(3), (d) heading, (1), (2), 
        (3), (4) heading, introductory text, (i) and (ii) revised; 
        (c)(4) added...............................................19947
655.705 (b) and (c) introductory text amended......................19948
655.715 Amended.............................................19948, 78067
655.720 (a) amended................................................19949
655.730 Introductory text revised; (c)(4)(vii), (5) and (d)(5) 
        amended....................................................19949
655.731 Introductory text amended..................................19949
    (a)(2) introductory text, (ii), (b)(3)(iii)(A), (d)(2) and (3) 
revised............................................................78067
655.732 Introductory text amended..................................19949
655.733 Introductory text amended..................................19949
655.734 Introductory text amended..................................19949
655.735 Introductory text added....................................19949
655.740 (a)(2)(ii) amended.........................................19949
655.750 (a), (b)(1)(i) and (2) revised.............................19949
655.760 Introductory text added....................................19950
655.800--655.855 (Subpart I) Heading revised.......................19950
655.1102 Amended...................................................78068
655.1112 (c)(2) revised............................................78068
656 Authority citation revised.....................................78068
656.3 Amended......................................................78068
656.15 (a) amended; (f) removed; (g) redesignated as new (f).......78068
656.40 (a), (b) introductory text, (c), (g), (h) and (i) revised 
                                                                   78068
656.41 Revised.....................................................78069

                                  2009

20 CFR
                                                                   74 FR
                                                                    Page
Chapter V
655 Heading and authority citation revised.........................25985
655.1 Redesignated as 655.5 and suspended; new 655.1 added.........25985
655.5 Redesignated as 655.81 and suspended; redesignated from 
        655.1 and suspended........................................25985
655.81 Redesignated from 655.5 and suspended.......................25985

[[Page 849]]

655.90--655.119 (Subpart B) Redesignated as 655.1290--655.1319 
        (Subpart N) and suspended..................................25985
655.90--655.113 (Subpart B) Added..................................25985
655.100 (b)(1) and (2) introductory text revised; interim...17601, 59073
655.200--655.215 (Subpart C) Added.................................26002
655.731 (a)(2)(ii)(C) correctly added..............................45561
655.1290--655.1319 (Subpart N) Redesignated from 655.90--655.119 
        (Subpart B) and suspended..................................25985

                                  2010

20 CFR
                                                                   75 FR
                                                                    Page
Chapter V
606 Authority citation revised.....................................57156
606.3 Amended......................................................57156
606.20 (a)(3) amended..............................................57156
606.21 (c) and (d) amended.........................................57156
606.22 (b)(4), (c)(1), (2), (3) and (d)(3) amended.................57156
606.32 (b) revised.................................................57156
618 Added..........................................................17000
    Clarification..................................................44720
641 Revised........................................................53812
655 Heading and authority citation revised..........................6959
    Meeting.........................................................7367
    Authority citation revised; eff. 4-5-10........................10403
655.0 Correctly reinstated; CFR correction.........................16000
655.1 Revised.......................................................6959
655.100--655.185 (Subpart B) Revised................................6959
655.1100--655.1150 (Subpart L) Nomenclature changes; eff. 4-5-10 
                                                                   10403
655.1101 Revised; eff. 4-5-10......................................10403
655.1102 Amended; eff. 4-5-10......................................10404
655.1110 Revised; eff. 4-5-10......................................10404
655.1115 (b) revised; eff. 4-5-10..................................10405
655.1116 (b) revised; eff, 4-5-10..................................10405
655.1130 (c) revised; eff. 4-5-10..................................10406
655.1135 (d) revised; eff. 4-5-10..................................10406
655.1150 (a) revised; eff. 4-5-10..................................10406
655.1200--655.1260 (Subpart M) Nomenclature changes; eff. 4-5-10 
                                                                   10403
655.1215 Revised; eff. 4-5-10......................................10406
655.1255 Revised; eff. 4-5-10......................................10406

                                  2011

20 CFR
                                                                   76 FR
                                                                    Page
Chapter V
655 Policy statement.................................60720, 73509, 82116
655.10 (b) introductory text, (1) and (2) revised; (b)(4), (5), 
        (f) and (g) removed; (b)(3), (6), (h) and (i) redesignated 
        as (b)(4), (5), (f) and (g); new (b)(3), (6) and (7) 
        added; eff. 1-1-12..........................................3483
    Regulation at 76 FR 3483 eff. date changed to 9-30-11..........45667
    Regulation at 76 FR 3483 eff. date delayed to 11-30-11.........59896
    Regulation at 76 FR 3483 eff. date delayed to 1-1-12...........73508
    Regulation at 76 FR 3483 eff. date delayed to 10-1-12..........82115

                                  2012

   (Regulations published from January 1, 2012, through April 1, 2012)

20 CFR
                                                                   77 FR
                                                                    Page
Chapter V
641.140 Amended.....................................................4661
641.700 (c)(4) added................................................4661
641.710 (b)(3) added................................................4661
655 Policy statement........................................12723, 16157
655.1 Revised; eff. 4-23-12........................................10148
655.2 Revised; eff. 4-23-12........................................10148
655.3 Revised; eff. 4-23-12........................................10148
655.4 Revised; eff. 4-23-12........................................10148
655.5 Revised; eff. 4-23-12........................................10148
655.6 Revised; eff. 4-23-12........................................10148
655.7 Added; eff. 4-23-12..........................................10151
655.8 Added; eff. 4-23-12..........................................10151
655.9 Added; eff. 4-23-12..........................................10151
655.10 Undesignated center heading added; (a), (c), (d), (e), (h) 
        and (i) revised; (j) and (k) added; eff. 4-23-12...........10151
655.11 Revised; eff. 4-23-12.......................................10152
655.12 Added; eff. 4-23-12.........................................10153
655.13 Added; eff. 4-23-12.........................................10153
655.15 Undesignated center heading added; section revised; eff. 4-
        23-12......................................................10153
655.16 Added; eff. 4-23-12.........................................10154
655.17 Revised; eff. 4-23-12.......................................10154
655.18 Added; eff. 4-23-12.........................................10154
655.19 Added; eff. 4-23-12.........................................10154
655.20 Undesignated center heading added; section revised; eff. 4-
        23-12......................................................10156

[[Page 850]]

655.21 Removed; eff. 4-23-12.......................................10160
655.22 Removed; eff. 4-23-12.......................................10160
655.23 Removed; eff. 4-23-12.......................................10160
655.24 Removed; eff. 4-23-12.......................................10160
655.30 Revised; eff. 4-23-12.......................................10160
655.31 Revised; eff. 4-23-12.......................................10160
655.32 Revised; eff. 4-23-12.......................................10160
655.33 Revised; eff. 4-23-12.......................................10160
655.34 Revised; eff. 4-23-12.......................................10160
655.