[Federal Register Volume 69, Number 153 (Tuesday, August 10, 2004)]
[Notices]
[Pages 48527-48528]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 04-18236]


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DEPARTMENT OF LABOR

Employment and Training Administration

[TA-W-53,648]


International Business Machines Corporation, Tulsa, Oklahoma; 
Notice of Negative Determination on Reconsideration on Remand

    The United States Court of International Trade (USCIT) granted the 
Secretary of Labor's motion for a voluntary remand for further 
investigation in Former Employees of International Business Machines 
Corporation v. Elaine Chao, U.S. Secretary of Labor, No. 04-00079.
    The Department's initial negative determination regarding 
International Business Machines Corporation (hereafter ``IBM'') was 
issued on December 2, 2003 and published in the Federal Register on 
January 16, 2004 (69 FR 2622). The determination was based on the 
finding that the workers did not produce an article within the meaning 
of Section 222 of the Trade Act of 1974. The workers provided 
accounting and application services.
    By letter of February 6, 2004, the petitioner requested 
administrative reconsideration for Trade Adjustment Assistance (TAA). 
The negative reconsideration determination was issued on March 31, 
2004. The notice of determination was published in the Federal Register 
on April 16, 2003 (67 FR 20644). The determination was based on the 
findings that the workers did not produce an article within the meaning 
of Section 222 of the Trade Act and that the workers did not provide 
services in direct support of a TAA certified firm.
    In their submissions to the Department, Plaintiffs made the 
following assertions: (1) Workers of IBM, Tulsa, Oklahoma are under the 
control of British Petroleum (BP) and should be treated as BP 
employees; (2) Workers of IBM, Tulsa, Oklahoma are engaged in 
production of a trade impacted article (crude oil and natural gas), 
based on a previous certification issued in February 1999 by the 
Department for workers of AMOCO Exploration and Production in the State 
of Oklahoma; and (3) IBM workers in Tulsa, Oklahoma are BP-controlled 
workers engaged in production and because BP could be certified for 
TAA, the workers of IBM, Tulsa, Oklahoma should be eligible for TAA 
benefits.
    On remand, the Department conducted a careful investigation in 
response to the plaintiff's allegations and will address each assertion 
in turn.

Workers of IBM, Tulsa, Oklahoma Are Under the Control of BP

    In order to determine the scope of control by BP over the workers 
of IBM, Tulsa, Oklahoma, the Department requested additional 
information from IBM regarding the business relationship of IBM and BP, 
the functions of the subject worker group and the operations of IBM.
    The information obtained during the remand investigation revealed 
that the relationship between IBM and BP is based on a contractual 
agreement documenting the commercial terms of service between two 
independent companies and that BP had no legal control over IBM 
employees. According to an IBM official, IBM is an independent company 
with its headquarters in Armonk, New York and there is no affiliation 
between IBM and BP. The IBM employees in Tulsa, Oklahoma provide 
finance, accounting and information technology services to multiple 
clients, including BP. These employees were subject to IBM's terms and 
conditions of employment, reported to IBM managers and were located at 
an IBM facility in Tulsa, Oklahoma. IBM provides services to numerous 
BP facilities located in the United States. These functions include 
general accounting, capital asset accounting, oil and gas revenue 
accounting, and accounts payable and receivable. Further, according to 
the IBM official, workers of IBM were not employed at any BP facility 
during the relevant time period. Therefore, the Department determines 
that IBM workers were not under the control of BP during the relevant 
time period.

Workers of IBM, Tulsa, Oklahoma Are Engaged in Production

    Plaintiffs allege that members of the subject worker group are 
engaged in

[[Page 48528]]

production (crude oil and natural gas). To address this allegation, the 
Department contacted the subject company and requested that IBM verify 
this information. On further investigation, it was revealed that no oil 
or gas is being produced within the IBM Corporation and workers of the 
subject firm are not in support of the production for any IBM 
affiliated facilities.
    The plaintiffs base their assertion on a previous TAA certification 
(TA-W-35,309N) for another worker group (AMOCO Exploration and 
Production). For the reasons described below, Department has determined 
that the plaintiffs' reliance on this certification is without basis.
    Case TA-W-35,309N refers to workers at AMOCO Exploration and 
Production, and AMOCO Shared Services, operating in the state of 
Oklahoma, including accountants then working for AMOCO at the Tulsa 
facility, who were certified eligible to apply for adjustment 
assistance on February 19, 1999. That certification was amended on 
March 14, 1999 to reflect new ownership and a name change to BP/AMOCO, 
AMOCO Exploration and Production, AMOCO Shared Services, A/K/A AMOCO 
Production Company, Inc., operating in the state of Oklahoma. Workers 
certified in that instance were determined to be ``engaged in 
activities related to exploration and production of crude oil and 
natural gas.'' That certification expired February 19, 2001, well 
beyond the relevant time period. The relevant period for this 
investigation stretches back one year from the date of the petition, or 
February 10, 2003. The Department considers facts related to the 
relevant period of the current investigation; therefore the previous 
certification has no bearing on the determination of eligibility at 
this time.
    In order for workers to be considered eligible for TAA, the worker 
group seeking certification must work for a ``firm'' or subdivision 
that produces an article domestically, and production must have 
occurred within the relevant period of the investigation. As stated in 
the reconsideration determination, the workers in the immediate case 
can be distinguished from the workers covered by TA-W-35,309N in that, 
unlike the workers in the immediate case, the workers covered by TA-W-
35,309N were employed by the subject company and were in direct support 
of an affiliated facility that was, at the time, currently certified 
for TAA. Because the workers of IBM, Tulsa, Oklahoma are neither 
employed by BP nor in direct support of an IBM facility whose workers 
are currently TAA-certified or could be certified for TAA, the members 
of the subject worker group are not workers engaged in the production 
of an article, in this case, oil and gas.

IBM workers in Tulsa, Oklahoma Should Be Eligible for TAA

    Plaintiffs allege that because IBM workers in Tulsa, Oklahoma are 
BP-controlled workers, the IBM workers are engaged in production, and 
BP could be certified for TAA, the workers of IBM, Tulsa, Oklahoma 
should be eligible for TAA benefits.
    As previously discussed, the subject worker group is not controlled 
by BP and cannot, therefore, be treated as BP workers and is not 
engaged in production of crude oil and natural gas.
    Even assuming that the IBM workers were considered leased workers 
of BP, the IBM workers would not be eligible for TAA. Historically, the 
Department included only leased production workers in TAA 
certifications. However, on January 23, 2004 a new policy was 
instituted which allowed a certification of all leased workers, 
including service workers who are working at the same location as 
workers who have been previously certified eligible for TAA. According 
to this policy, in order to be eligible, leased workers must perform 
their duties onsite at the affected location on an established 
contractual basis. As discussed above, the IBM contract with BP does 
not subject the IBM workers to the kind of control by BP that makes 
them leased workers. Further, it was determined that workers of IBM, 
Tulsa, Oklahoma are not co-located with BP workers at a BP facility 
that produces an article.
    Section 222 of the Trade Act establishes that the Department shall 
not certify a group unless increases of imports of articles like or 
directly competitive with articles produced by such workers' firm or an 
appropriate subdivision thereof contributed importantly to such total 
or partial separation, or threat thereof, and to such decline in sales 
or production. Under this requirement, the Department cannot issue a 
certification of eligibility to a worker group unless the workers' firm 
or an appropriate subdivision of the workers' firm produces an import-
impacted article. The Tulsa, Oklahoma facility is an IBM-owned facility 
and BP did not have any operation at that location during the relevant 
time period.

Conclusion

    After reconsideration on remand, I affirm the original notice of 
negative determination of eligibility to apply for adjustment 
assistance for workers and former workers of International Business 
Machines Corporation, Tulsa, Oklahoma.

    Signed at Washington, DC, this 2nd day of August 2004.
Elliott S. Kushner,
Certifying Officer, Division of of Trade Adjustment Assistance
[FR Doc. 04-18236 Filed 8-9-04; 8:45 am]
BILLING CODE 4510-30-P