[Federal Register Volume 87, Number 185 (Monday, September 26, 2022)]
[Rules and Regulations]
[Pages 58269-58288]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-20560]



[[Page 58269]]

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DEPARTMENT OF LABOR

29 CFR Part 29

[Docket No. ETA-2021-0007]
RIN 1205-AC06


Apprenticeship Programs, Labor Standards for Registration

AGENCY: Employment and Training Administration, Labor.

ACTION: Final rule.

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SUMMARY: The U.S. Department of Labor (DOL or the Department) is 
issuing this final rule to rescind its 2020 regulation that established 
a process under which the Department's Office of Apprenticeship (OA) 
Administrator (Administrator) was authorized to grant recognition to 
qualified third-party entities, known as Standards Recognition Entities 
(SREs), which in turn were authorized to evaluate and extend 
recognition to Industry-Recognized Apprenticeship Programs (IRAPs). 
This final rule also makes necessary conforming changes to the 
regulations governing the registration of apprenticeship programs by 
the Department.

DATES: This final rule is effective November 25, 2022.

FOR FURTHER INFORMATION CONTACT: John V. Ladd, Administrator, Office of 
Apprenticeship, U.S. Department of Labor, 200 Constitution Avenue NW, 
Room C-5311, Washington, DC 20210; telephone (202) 693-2796 (this is 
not a toll-free number).
    Individuals with hearing or speech impairments, please dial 7-1-1 
to access telecommunications relay services.

SUPPLEMENTARY INFORMATION: 

List of Abbreviations

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           Abbreviation                          Definition
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AAI...............................  American Apprenticeship Initiative.
Administrator.....................  Administrator of the U.S. Department
                                     of Labor's Office of
                                     Apprenticeship.
BLS...............................  U.S. Bureau of Labor and Statistics.
CFR...............................  Code of Federal Regulations.
COVID-19..........................  Coronavirus Disease 2019.
DOL or the Department.............  U.S. Department of Labor.
ECEC..............................  Employer Costs for Employee
                                     Compensation.
EEO...............................  equal employment opportunity.
E.O...............................  Executive Order.
ERISA.............................  Employee Retirement Income Security
                                     Act of 1974.
ETA...............................  Employment and Training
                                     Administration.
FR................................  Federal Register.
FY................................  Fiscal Year.
GS................................  General Schedule.
HHS...............................  U.S. Department of Health and Human
                                     Services.
IC................................  information collection.
IRAP..............................  Industry-Recognized Apprenticeship
                                     Program.
IT................................  information technology.
NAA...............................  National Apprenticeship Act of 1937.
NPRM..............................  Notice of Proposed Rulemaking.
OA................................  Office of Apprenticeship.
OJL...............................  on-the-job learning.
OMB...............................  Office of Management and Budget.
RAP...............................  Registered Apprenticeship program.
RAPIDS............................  Registered Apprenticeship Partners
                                     Information Database System.
RI................................  Related instruction.
SAA...............................  State Apprenticeship Agency.
Secretary.........................  U.S. Secretary of Labor.
SOC...............................  Standard Occupational
                                     Classification.
SRE...............................  Standards Recognition Entity.
Task Force........................  Task Force on Apprenticeship
                                     Expansion.
UMRA..............................  Unfunded Mandates Reform Act of
                                     1995.
U.S.C.............................  U.S. Code.
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Preamble Table of Contents

I. Background
II. The Registered Apprenticeship System Is Highly Successful for 
Industry
III. The Registered Apprenticeship System Is Highly Successful for 
Workers
    A. Registered Apprenticeships Uniformly Provide More Rigorous, 
Higher Quality Training
    B. Registered Apprenticeships Provide Better Safety and Welfare 
Protections
IV. The IRAP System Is Redundant of the Registered Apprenticeship 
System
V. The Effect of the Department's Rescission of the 2020 IRAP Final 
Rule
VI. Regulatory Analysis and Review
    A. Executive Orders 12866 (Regulatory Planning and Review) and 
13563 (Improving Regulation and Regulatory Review)
    B. Regulatory Flexibility Act, Small Business Regulatory 
Enforcement Fairness Act of 1996, and Executive Order 13272 (Proper 
Consideration of Small Entities in Agency Rulemaking)
    C. Paperwork Reduction Act
    D. Executive Order 13132: Federalism
    E. Unfunded Mandates Reform Act of 1995
    F. Executive Order 13175 (Indian Tribal Governments)

I. Background

    The National Apprenticeship Act of 1937 (NAA), 29 U.S.C. 50, 
authorizes the Secretary of Labor (Secretary) to: (1) formulate and 
promote the use of labor standards necessary to safeguard the welfare 
of apprentices and to encourage their inclusion in apprenticeship 
contracts; (2) bring together employers and labor for the formulation 
of programs of apprenticeship; and (3) cooperate with State agencies 
engaged in the formulation and promotion of standards of 
apprenticeship. 29 U.S.C. 50. The Department promulgated

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regulations to implement the NAA at 29 CFR part 30 (equal employment 
opportunity (EEO) in apprenticeship) in 1963 and at 29 CFR part 29 
(labor standards for the registration of apprenticeship programs) in 
1977. The part 30 regulations prohibit discrimination in Registered 
Apprenticeship based on race, color, religion, national origin, sex 
(including pregnancy and gender identity), sexual orientation, age (40 
or older), genetic information, and disability, and they require 
sponsors of Registered Apprenticeship programs (RAPs) to promote equal 
opportunity in such programs. The part 29 regulations set forth labor 
standards designed to safeguard the welfare of apprentices in RAPs, 
including: prescribing policies and procedures concerning the 
registration, cancellation, and deregistration of apprenticeship 
programs; recognizing State Apprenticeship Agencies (SAAs) as 
Registration Agencies; and matters relating thereto. The Department 
significantly updated 29 CFR part 29 in 2008 to ``increase flexibility, 
enhance program quality and accountability, and promote apprenticeship 
opportunity in the 21st century, while continuing to safeguard the 
welfare of apprentices'' (73 FR 64402, Oct. 29, 2008, hereinafter ``the 
2008 final rule''), and updated 29 CFR part 30 in 2016 ``to modernize 
the equal employment opportunity regulations'' (81 FR 92026, Dec. 19, 
2016). These regulations provide the framework for the Registered 
Apprenticeship system.
    On June 15, 2017, President Trump issued Executive Order (E.O.) 
13801, ``Expanding Apprenticeships in America'' (82 FR 28229), which 
directed the Secretary of Labor to consider issuing regulations that 
promote the development of IRAPs by third parties. Section 8(b)(iii) of 
E.O. 13801 also established a Task Force on Apprenticeship Expansion 
(Task Force) to identify strategies and proposals to promote 
apprenticeships, to include ``the most effective strategies for 
creating industry-recognized apprenticeships.'' Based on E.O. 13801 and 
the Task Force's recommendations, the Department issued a Notice of 
Proposed Rulemaking (NPRM) on June 25, 2019 (84 FR 29970, hereinafter 
``the 2019 IRAP NPRM''), which proposed amending 29 CFR part 29 by 
adding a subpart (subpart B) containing a new regulatory framework 
governing both the recognition and oversight of SREs by the Department, 
and the recognition and oversight of IRAPs by Department-recognized 
SREs. After considering approximately 326,000 written comments on the 
2019 IRAP NPRM, the Department published a final rule in the Federal 
Register on March 11, 2020 (85 FR 14294), entitled ``Apprenticeship 
Programs, Labor Standards for Registration, Amendment of Regulations'' 
(hereinafter ``the 2020 IRAP final rule''), which established a new 29 
CFR part 29, subpart B governing the recognition and oversight of SREs 
and IRAPs, designated the Registered Apprenticeship regulations at 29 
CFR 29.1 through 29.14 as subpart A under the heading ``Subpart A--
Registered Apprenticeship Programs,'' and made conforming edits to 
subpart A to account for the addition of subpart B.
    The 2020 IRAP final rule established a set of standards and 
procedures under which the Administrator would evaluate and extend 
recognition to SREs; these recognized SREs, in turn, were authorized 
under the rule to evaluate and recognize IRAPs. The 2020 IRAP final 
rule set forth in detail the requirements for third-party entities 
applying for Departmental recognition as SREs. It also identified 
certain requirements apprenticeship programs must meet to obtain 
recognition from SREs as IRAPs. The 2020 IRAP final rule became 
effective on May 11, 2020.
    On February 17, 2021, President Biden issued E.O. 14016, 
``Revocation of Executive Order 13801'' (86 FR 11089); section 2 of 
this E.O. directed Federal agencies to ``promptly consider taking steps 
to rescind any orders, rules, regulations, guidelines, or policies'' 
implementing E.O. 13801. Pursuant to E.O. 14016, on February 17, 2021, 
the Department announced that it would initiate a review of the IRAP 
system. The Department also suspended the acceptance and review of new 
and pending SRE recognition applications.\1\ The Department advised 
that all SREs recognized by the Department prior to the February 17, 
2021 suspension, as well as all IRAPs recognized by an SRE prior to 
that date, could continue to operate in accordance with the 
requirements outlined in 29 CFR part 29, subpart B. At the time the 
Department began the SRE pause and IRAP system review, there were 27 
organizations recognized by the Department as SREs.
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    \1\ DOL, ``U.S. Department of Labor Undertakes Several Actions 
to Strengthen Registered Apprenticeship Program, Eliminate 
Duplication,'' Feb. 17, 2021, https://www.dol.gov/newsroom/releases/eta/eta20210217.
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    Consistent with E.O. 14016, the Department considered whether to 
retain the 2020 IRAP regulation. After review, the Department concluded 
that retaining the IRAP regulatory framework was not in the best 
interest of apprentices or the Department. Accordingly, on November 15, 
2021, the Department published an NPRM in the Federal Register (86 FR 
62966, hereinafter ``the 2021 IRAP Rescission NPRM''), proposing to 
rescind the 2020 IRAP final rule and to make necessary conforming 
changes to the Department's Registered Apprenticeship regulations in 29 
CFR part 29, subpart A (Registered Apprenticeship Programs).
    In the 2021 IRAP Rescission NPRM, the Department explained the 
rationale for adopting the 2020 IRAP final rule, acknowledged that the 
proposed rescission represented a change in its position with respect 
to the need for and the benefits of IRAPs, and explained why it 
proposed to rescind the 2020 final rule. Commenters on the proposed 
rescission largely supported the Department's proposal for the reasons 
discussed at length in the proposal, as discussed in more detail in the 
``Public Comments'' section below. Accordingly, the Department, for the 
reasons discussed in the 2021 IRAP Rescission NPRM and the preamble to 
this final rule, is finalizing the rule as proposed.
    The Department is rescinding the 2020 IRAP final rule because it 
has determined that the Department's efforts and resources should be 
focused on Registered Apprenticeship, which has proven to be highly 
successful for both industry and workers and incorporates valuable 
quality standards and worker protections. This is consistent with the 
Administration's priority to expand Registered Apprenticeship because 
of its success as a pathway to the middle class and ability to connect 
a diverse workforce to family-supporting jobs.\2\ Further, it aligns 
with the Department's priority to use ``Registered Apprenticeship [to] 
provide pathways to strengthen our workforce and our economy.'' \3\
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    \2\ https://www.whitehouse.gov/briefing-room/statements-releases/2021/02/17/fact-sheet-biden-administration-to-take-steps-to-bolster-registered-apprenticeships/.
    \3\ https://www.dol.gov/newsroom/releases/eta/eta20210217.
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    In contrast, and as explained in detail in the 2021 IRAP Rescission 
NPRM, the Department now believes the 2020 IRAP final rule does not 
align with the Department's priorities of providing high-quality 
training with an emphasis on apprentice safety and welfare. 86 FR 
62968-71. This is due to the 2020 IRAP final rule's fewer quality 
training and worker protection standards as compared to Registered 
Apprenticeship's on-the-job learning and related instruction 
requirements and apprentice protections, such as

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enhanced safety standards, a progressive wage requirement, and EEO 
regulations. Within the Registered Apprenticeship regulations, there is 
also greater accountability because the Department can exercise direct 
oversight to ensure employers provide industry-established prevailing 
wages, ensure stringent safety standards are in place, and monitor 
program quality to protect workers. By contrast, the Department's 
limited, indirect oversight role of IRAPs under the 2020 IRAP final 
rule constrains its ability to ensure that IRAPs are providing quality 
training and worker protection, leading to potentially inequitable 
access to higher quality training and worker protections among program 
participants. Accordingly, the Department no longer believes the IRAP 
model is a reasonable or effective alternative to the training 
standards, worker protection, and oversight that are the cornerstones 
of Registered Apprenticeship. 86 FR 62968-71.
    The Department also determined that two of the key justifications 
for issuing the 2020 IRAP final rule--the purported inflexibility in 
the Registered Apprenticeship system and the administrative burdens 
hindering Registered Apprenticeship's ability to meet the needs of 
different industries--are fundamentally flawed. As discussed at length 
in the 2021 IRAP Rescission NPRM, the assertion that the Registered 
Apprenticeship system is inflexible and administratively burdensome is 
belied by the demonstrated success of Registered Apprenticeship for 
industry and workers alike, and by Registered Apprenticeship's 
continued growth and expansion into new industries and occupations. 
Indeed, Registered Apprenticeship has continued to show strong growth 
since its establishment, including the latest data reflecting strong 
growth in 2020 and 2021, during the height of the COVID-19 
pandemic.4 5 RAPs are a flexible training strategy, with 
vital quality controls, that can be customized to meet the business 
needs for a skilled workforce. As the Department discussed in the 2021 
IRAP Rescission NPRM, the most recent data reflects that Registered 
Apprenticeship has not only continued to grow but has also expanded 
into ``non-traditional'' industry sectors, such as healthcare, 
cybersecurity, transportation, and advanced manufacturing, through a 
variety of initiatives (e.g., Department's 2015 American Apprenticeship 
Initiative (AAI)) and has demonstrated success in those sectors. 86 FR 
62971-72.
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    \4\ OA 2020 Data and Statistics, available at https://www.dol.gov/agencies/eta/apprenticeship/about/statistics/2020.
    \5\ OA 2021 Data and Statistics, available at https://www.dol.gov/agencies/eta/apprenticeship/about/statistics/2021.
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    The Department also determined that the 2020 IRAP final rule's 
justification that IRAPs were necessary to address a purported ``skills 
gap'' was based on faulty reasoning. As discussed in the 2021 IRAP 
Rescission NPRM, the Department no longer believes the purported 
``skills gap,'' as referenced in the 2020 IRAP final rule, to be the 
major challenge facing the labor market. 86 FR 62971. Rather, the 
Department now believes that there are additional factors that have a 
bearing on industry labor needs, such as employer investments in 
workforce development, competitive and rising wages to attract and 
retain workers, commitments to opportunity and diversity, and worker 
empowerment.6 7 These are factors that the RAP framework 
supports and is well-positioned to address, thereby providing a more 
promising and effective framework for addressing and closing persistent 
inefficiencies in the labor market. In contrast, the 2020 IRAP final 
rule is deficient in incorporating these factors, and its deficiencies 
in job quality and worker protection requirements (particularly with 
respect to EEO and progressive wages for apprentices) reduce the 
ability of IRAPs to address any current or future labor shortages. 
Further, the IRAP final rule's deficiencies in ensuring quality 
standards for workers undermine both the RAP framework and the 
Administration's commitment to promoting good quality, family-
sustaining jobs for all workers, including apprentices.
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    \6\ Annelies Goger and Luther Jackson, ``The labor market 
doesn't have a `skills gap'--it has an opportunity gap,'' Sept. 9, 
2020, https://www.brookings.edu/blog/the-avenue/2020/09/09/the-labor-market-doesnt-have-a-skills-gap-it-has-an-opportunity-gap/.
    \7\ Kate Bahn, `` `Skills gap' arguments overlook collective 
bargaining and low minimum wages,'' May 9, 2019, https://equitablegrowth.org/skills-gap-arguments-overlook-collective-bargaining-and-low-minimum-wages/.
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    Finally, through the experience of administering the IRAP system, 
the Department has determined that the IRAP system is redundant of 
Registered Apprenticeship and that such redundancy creates confusion 
and reduces resources that would be better used to support the 
continued success and growth of Registered Apprenticeship across 
industries and occupations. As discussed in the 2021 IRAP Rescission 
NPRM, the Department observed significant duplication of occupations 
covered by RAPs and IRAPs. 86 FR 62972. The Department notes that the 
flexible RAP model has continued to expand into emerging occupations 
and sectors; accordingly, as discussed above and in the 2021 IRAP 
Rescission NPRM, there is a significant overlap in the industry sectors 
served by RAPs and IRAPs. Further, the administration of the IRAP 
system has generated duplicative work and costs for the Department, 
created inconsistent standards for quality training, reduced worker 
protections such as EEO, and committed limited resources that could 
have been better utilized by the Department to partner with industry to 
expand the existing Registered Apprenticeship system. 86 FR 62971-72.

Public Comments

    The 2021 IRAP Rescission NPRM invited written comments from the 
public concerning the proposed rulemaking; the comment period closed on 
January 14, 2022. During the 60-day public comment period, the 
Department received a total of 20 public comment submissions (including 
18 unique submissions, one duplicate submission, and one submission 
that was outside the scope of the rulemaking). The comments received on 
the 2021 IRAP Rescission NPRM may be viewed at https://www.regulations.gov by entering docket number ETA-2021-0007.
    The commenters represented a range of stakeholders from the public, 
private, and not-for-profit sectors, including: six labor 
organizations; three trade associations; two advocacy organizations; 
two SAAs; one organization that represents SAAs; one SRE; and one IRAP. 
The Department also received comments from two individuals. After 
careful consideration of the comments received and for the reasons 
explained below, the Department is adopting this final rule, which 
rescinds the regulatory framework for SREs and IRAPs codified at 29 CFR 
part 29, subpart B, and makes necessary conforming changes to the 
Department's Registered Apprenticeship regulations in 29 CFR part 29, 
subpart A, as proposed (including removing the subpart A designation).

General Support for and Opposition to the 2021 Proposal To Rescind the 
2020 IRAP Final Rule

    Several commenters discussed their general support for the proposal 
to rescind the 2020 IRAP final rule and thereby remove the regulatory 
framework for SREs and IRAPs under 29 CFR part 29, subpart B. Some 
commenters expressed agreement with the proposal and further supported 
the proposal's focus on strengthening and modernizing the current 
Registered

[[Page 58272]]

Apprenticeship system, ensuring that apprentices are protected from 
abuse and properly trained by their chosen apprenticeship program, and 
safeguarding the welfare of apprentices. Other commenters expressed 
support for the proposal and argued that the Registered Apprenticeship 
system should be supported and expanded to new industries and that, 
``if allowed to remain in place, the 2020 IRAP final rule would 
threaten to undo more than eight decades of highly effective 
apprenticeship programs validated by public entities.'' A commenter 
conveyed its support for the removal of subpart B because doing so 
would ensure that construction industry apprenticeships continue as the 
``gold standard'' for apprenticeship programs throughout the United 
States and to serve as an example to other industries to emulate. 
Another commenter urged the Department to ensure that the proposal only 
strengthen RAPs and maintain the high quality of the Registered 
Apprenticeship system.
    The Department appreciates the commenters' support of the proposal 
and agrees that the RAP model is effective and has proven successful 
for both industry and workers for more than 80 years. The Department 
shares the view of the commenters who believe that the Department 
should focus its efforts on bolstering and modernizing the Registered 
Apprenticeship system and facilitating the expansion of RAPs into new 
and emerging industries and sectors. The Department appreciates the 
commenter's assertion that the rescission of 29 CFR part 29, subpart B 
would ensure that construction industry apprenticeships continue as the 
``gold standard'' for apprenticeship programs, however, the Department 
also notes that the rescission of this subpart would ensure that all 
apprenticeship programs, including construction industry 
apprenticeships, maintain high-quality labor standards in connection 
with the Registered Apprenticeship framework. The Department recognizes 
the value of the Registered Apprenticeship system and has prioritized 
investing in the RAP model to rebuild the economy, expand economic 
opportunities and workforce access for underrepresented populations and 
communities, and advance racial and gender equity. By adopting this 
proposal, the Department preserves high-level requirements for 
apprentice training and safety. These requirements are vital to 
establishing quality RAP opportunities that lead to good-quality jobs, 
and careers for workers, while also helping fulfill labor market 
demands and support economic growth.
    The Department received comments expressing general support for the 
IRAP model, based on commenters' use of the model, and discussing some 
of the benefits of their use of the IRAP model. One commenter described 
the process by which it developed an SRE and its process to create 
criteria to evaluate IRAPs. The commenter described its process as 
fair, valid, impartial and well-received by the IRAP that it 
recognized. Another commenter asserted that IRAPs can help close the 
growing skills gap, creating a bridge between business leaders and 
career seekers. The commenter further argued that IRAPs help rebuild 
the workforce by shortening the amount of time required to enter or 
upskill in a given industry. The commenter also highlighted the 
internal and external program evaluation elements in their IRAP that 
cover validation of need, validation of competencies, qualifications of 
personnel, apprentice selection, and program effectiveness.
    The Department acknowledges these comments in general support of 
IRAPs and appreciates that there can be instances of success in IRAPs. 
Nevertheless, as stated in the 2021 IRAP Rescission NPRM, the 
Department views the 2020 IRAP final rule as inconsistent with the 
Department's goal of expanding quality apprenticeships in a manner that 
both ensures a high level of quality for apprentices and industry while 
also retaining the necessary flexibility to adapt apprenticeships to 
different industries and occupations. Further, the Department views the 
IRAP system as duplicative of the Registered Apprenticeship system, 
though with fewer quality standards and less oversight, and the IRAP 
system is not a prudent use of Government resources and would diminish 
the quality and coherence of the Department's apprenticeship efforts.
    In response to the commenter who asserted that IRAPs can help 
address the skills gap in the American workforce, the Department 
disagrees with this view. In the 2021 IRAP Rescission NPRM, the 
Department explained why the IRAP model is not poised to address the 
existing challenges and inefficiencies in the labor market. 
Specifically, while providing training to job seekers is a key 
component to addressing any ``skills gaps'' or ``skills mismatches,'' 
evidence suggests that training alone is not the answer. Employer 
investments in workforce development, competitive and rising wages to 
attract and retain workers, commitments to opportunity and diversity, 
and worker empowerment are key factors to addressing industry labor 
needs.8 9 The well-established RAP model provides a more 
promising and effective framework for addressing and closing persistent 
inefficiencies in the labor market.
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    \8\ Annelies Goger and Luther Jackson, ``The labor market 
doesn't have a `skills gap'--it has an opportunity gap,'' Sept. 9, 
2020, https://www.brookings.edu/blog/the-avenue/2020/09/09/the-labor-market-doesnt-have-a-skills-gap-it-has-anopportunity-gap/.
    \9\ Kate Bahn, `` `Skills gap' arguments overlook collective 
bargaining and low minimum wages,'' May 9, 2019, https://equitablegrowth.org/skills-gap-arguments-overlook-collective-bargaining-and-low-minimum-wages/.
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The Department's Role in Administering the National Apprenticeship Act 
and Implementing Its Regulations

    The Department received several comments that questioned whether 
the 2020 IRAP final rule's issuance was consistent with the NAA, 
referring to the legislative history and purpose of the NAA. One 
commenter, in describing the NAA's legislative history, highlighted 
congressional comments about Federal intervention to halt the 
exploitation of apprentices. Several commenters remarked that the 2020 
IRAP final rule constituted an improper delegation of the Department's 
authority under the NAA. One commenter stated that Congress did not 
enable the Secretary to delegate the authority to approve 
apprenticeships or apprenticeship standards to an outside party. 
Similarly, another commenter stated that the 2020 IRAP final rule 
shifts the authority from the Department to third-party SREs in 
contravention of the Department's responsibility under the NAA to 
determine whether statutory requirements have been met. Another 
commenter stated that IRAPs created under the 2020 IRAP final rule do 
not feature the level of standardization demanded by the NAA. A 
commenter asserted that the 2020 IRAP final rule unlawfully delegated 
EEO oversight to SREs, contrary to the Department's goals in the 29 CFR 
part 30 regulations to address discrimination and inequitable 
participation of women and minorities in apprenticeships. Another 
commenter asserted that the 2020 IRAP final rule eliminated protections 
for apprentices established by the 2008 final rule, including: (1) the 
requirement that a State Apprenticeship Agency serving as a 
Registration Agency recognized by the Department under 29 CFR part 29 
must be a Government entity; (2) the provisional registration of new 
apprenticeship programs; (3) minimum standards for instructor 
qualifications; and (4) a cap on the length of an apprentice's 
probationary period. The commenter argued that rescinding the

[[Page 58273]]

IRAP regulations would restore these important protections as well as 
other safeguards that preceded the 2008 final rule, such as the minimum 
number of hours of related instruction (RI), for all apprentices.
    The Department acknowledges these comments and appreciates their 
support for the 2021 IRAP Rescission NPRM. As the Department explained 
in the 2020 IRAP final rule (85 FR 14295-14296, Mar. 11, 2020), the NAA 
provides a general authorization and direction for the Secretary to 
create and promote standards of apprenticeship, including through 
contracts, and to interface with employers, labor, and States to create 
apprenticeships and apprenticeship standards. See 29 U.S.C. 50. The 
2020 IRAP final rule does not exceed or conflict with the broad 
authority granted by Congress to the Secretary in the NAA. However, the 
Department agrees that IRAPs created under the 2020 IRAP final rule do 
not provide adequate standards for high-quality training or safety and 
welfare protections, including sufficient EEO protections. As stated in 
the 2021 IRAP Rescission NPRM, the 2020 IRAP final rule ``does not 
provide adequate focus on worker needs and protections, does not ensure 
adequate program quality standards, does not provide sufficient [EEO] 
protections for apprentices, and does not provide a proven pathway to 
family-sustaining jobs'' (86 FR 62967, Nov. 15, 2021).
    With regard to the comment that the 2020 IRAP final rule eliminated 
protections for apprentices established by the 2008 final rule, the 
Department clarifies that the 2020 IRAP final rule did not propose any 
revisions to the 29 CFR part 29 requirements that a State 
Apprenticeship Agency serving as a Registration Agency must be a 
Government entity, the provisional registration of new apprenticeship 
programs, the minimum standards for instructor qualifications, and a 
cap on the length of an apprentice's probationary period. Rather, the 
2020 IRAP final rule made technical amendments to subpart A to account 
for subpart B. The 2021 IRAP Rescission NPRM proposed to remove subpart 
B, to make conforming technical edits to what had been subpart A, and 
to remove the distinctions of subparts because they would no longer be 
necessary with the removal of subpart B. Therefore, no changes are 
required in response to these comments.

II. The Registered Apprenticeship System Is Highly Successful for 
Industry

    A skilled workforce is foundational to a strong economy, and RAPs 
provide a proven avenue by which to deliver much needed talent 
development to various industry sectors. For over 80 years, the 
Registered Apprenticeship system has been successful in providing 
industry with high-quality work-based learning. RAPs combine paid on-
the-job learning (OJL) with RI to progressively increase workers' skill 
levels and wages. With this ``earn and learn'' model, apprentices are 
employed and earn wages from the first day on the job. Additionally, 
employers have continued to turn to Registered Apprenticeship to hire 
and train new employees, with over 241,000 new apprentices in RAPs in 
Fiscal Year (FY) 2021 across several industries, including 
cybersecurity, healthcare, advanced manufacturing, transportation, 
energy, and information technology (IT).\10\ Industries that have 
adopted RAPs as part of their work-based learning models have cited the 
standards, skillsets, and retention offered by skilled workers 
associated with RAPs as advantageous to their bottom line. In one 
survey, nearly three-fourths of surveyed employers stated that RAPs 
drove increased worker productivity.\11\ RAPs are a flexible training 
strategy, with vital quality controls, that can be customized to meet 
the business needs for a skilled workforce. These strategies include 
allowing employers to partner with workforce partners and educators to 
develop and apply industry standards to training programs, thereby 
increasing the quality and productivity of the workforce.
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    \10\ The 25 federally administered States and 18 federally 
recognized SAAs use the Employment and Training Administration's 
Registered Apprenticeship Partners Information Database System 
(RAPIDS) to provide individual apprentice and sponsor data. These 
data represent Registered Apprenticeship national results for FY 
2021 (Oct. 1, 2020-Sept. 30, 2021), as reported by these entities, 
and are available at https://www.dol.gov/agencies/eta/apprenticeship/about/statistics/2021 (last visited May 19, 2022).
    \11\ Urban Institute Research Report, ``The Benefits and 
Challenges of Registered Apprenticeship: The Sponsors' 
Perspective,'' June 12, 2009, https://www.urban.org/research/publication/benefits-and-challenges-registered-apprenticeship-sponsors-perspective.
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    Most commenters agreed with the Department's position in the NPRM 
that RAPs are highly successful for industry. One commenter noted the 
eight successful decades of the Registered Apprenticeship system and 
credited RAPs with continued success in expanding their presence in 
high-growth sectors (e.g., advanced manufacturing, healthcare, 
transportation, and IT) and ``in industries not traditionally 
associated with apprenticeship.'' Another commenter encouraged the 
Department to ``embrace and bolster'' the RAP model. Several commenters 
referred to RAPs as the ``gold standard'' for apprenticeship that 
creates a highly trained workforce. The Department appreciates these 
commenters' support for RAPs and agrees that the Registered 
Apprenticeship system has had a robust and successful history.
    Notably, these same commenters who lauded RAP as beneficial to 
industry also expressed their views that IRAPs are harmful to industry. 
One commenter expressed concern that the 2020 IRAP final rule's lack of 
uniform standards disincentivizes the creation of apprenticeship 
programs because apprentices are easily ``poached'' due to minimal 
standards and less program transparency. The commenter also stated that 
the Department's decision to create IRAPs was counter to the Task 
Force's recommendation to start with a pilot program to determine 
industry interest, leading to a hastily created apprenticeship model 
without evidence that it would be embraced by industry or successful as 
a viable alternative to RAPs.
    Commenters also expressed the view that the 2020 IRAP final rule 
was detrimental to the construction industry, despite the exclusion of 
construction activities from the 2020 IRAP final rule. A commenter also 
noted that future administrations could remove the construction 
exclusion from the 2020 IRAP final rule, thereby undermining RAPs in 
the construction industry, and jeopardizing RAPs as the ``premier 
method for preparing its future workforce.''
    The Department appreciates the support received to rescind the 2020 
IRAP final rule. The Department acknowledges the commenters' assertions 
that IRAPs would create disincentives to setting up apprenticeship 
programs or an overall negative impact on industry, including the 
construction industry. The Department's rationale for rescinding the 
2020 IRAP final rule does not rely upon general concerns about the 
potential detrimental effect to industry generally and the construction 
industry particularly, but the Department appreciates these concerns 
and notes that the rescission of the 2020 IRAP final rule in its 
entirety obviates such concerns.
    Conversely, a commenter in support of the IRAP system noted their

[[Page 58274]]

opposition to the Department's exclusion of the construction industry 
from recognition under the IRAP regulatory framework.\12\ This 
commenter argued that the construction industry was ripe for an 
expansion of apprenticeship opportunities. While the commenter 
applauded efforts to recruit, retrain, and upskill workers in the 
Registered Apprenticeship system, the commenter asserted that ``new and 
innovative apprenticeships'' are necessary in the construction sector 
as it recovers from the negative economic impacts of the Coronavirus 
Disease 2019 (COVID-19) pandemic. The commenter specifically 
highlighted the residential construction industry as one that could 
benefit from these new approaches to apprenticeship. The commenter 
urged the Department, when designing and implementing apprenticeship 
and job training opportunities, to target those industries with the 
highest number of job openings and conduct greater outreach efforts to 
identify the individual sectors that are underrepresented. The 
commenter also encouraged the Department to take steps to distinguish 
between types of construction activities (such as residential 
construction) and collaborate with the different segments of the 
construction industry ``to develop and expand [RAPs] through companies, 
educational organizations, and other nonunion groups that better 
represent the demographics of the workforce.''
---------------------------------------------------------------------------

    \12\ The 2020 IRAP final rule at Sec.  29.30 excluded SREs from 
not recognizing as IRAPs programs that seek to train apprentices to 
perform construction activities as defined in Sec.  29.30.
---------------------------------------------------------------------------

    In response to the comment reiterating opposition to the 
construction industry's exclusion in the 2020 IRAP final rule, the 
Department has concluded that the rescission of the 2020 IRAP final 
rule should have a beneficial impact across all industries by restoring 
a unitary regulatory framework for quality apprenticeship programs, 
both in sectors where such programs are widespread (such as 
construction) and in a wide range of high-growth and emerging 
occupations (such as healthcare, IT, cybersecurity, advanced 
manufacturing). While the Department notes the commenter's concerns 
about a current shortage of workers in the residential construction 
sector, it does not believe that preserving a parallel system of 
apprenticeship that lacks quality control and oversight is the 
appropriate solution for addressing such a worker shortage. Moreover, 
the Department notes that it has registered nonunion programs in the 
construction sector, which demonstrates the RAP model can be 
successfully utilized across all parts of an industry. The Department 
notes further that the IRAP system is not necessary to expand the reach 
of apprenticeship to new and different industries as RAPs have proven 
to be successful across a wide range of industry sectors. The 
Department continues to be interested in expanding and strengthening 
the RAP model in all industry sectors, including residential 
construction and other construction-related activities.

III. The Registered Apprenticeship System Is Highly Successful for 
Workers

A. Registered Apprenticeships Uniformly Provide More Rigorous, Higher 
Quality Training

    In addition to the demonstrated success of the Registered 
Apprenticeship system as a workforce training model for industry, it 
has proven to be highly successful and beneficial to workers because of 
its emphasis on both high-quality training and apprentice safety and 
welfare. RAPs are designed to ensure high-quality training through 
structured OJL, mentorship, and RI, while also prioritizing safety, 
wage progression, and EEO for apprentices. RAPs implement federally 
approved industry standards for training apprentices for skilled 
occupations in the workplace; specifically, these programs must abide 
by regulatory provisions for supervision and training of apprentices to 
further enhance safety in the workplace. During training, apprentices 
are guaranteed progressive wage increases, and research shows that RAP 
completers earn over $300,000 (including benefits) more over their 
lifetimes as compared with individuals who do not complete a RAP.\13\ 
Further, the Department has taken significant steps to increase the 
participation of women and individuals from underrepresented groups 
through the robust requirements in 29 CFR part 30. With Registered 
Apprenticeship, there is also an added level of accountability because 
the Department can intervene and ensure employers provide progressive 
wages established in their approved Registered Apprenticeship 
standards, ensure stringent safety standards are in place, address 
discrimination and issues of equal opportunity, and monitor program 
quality to protect workers.
---------------------------------------------------------------------------

    \13\ See, e.g., Mathematica Policy Research, ``An Effectiveness 
Assessment and Cost-Benefit Analysis of Registered Apprenticeship in 
10 States: Final Report,'' July 25, 2012, https://wdr.doleta.gov/research/FullText_Documents/ETAOP_2012_10.pdf. The study cautions 
against interpreting its results, which do not control for 
unobservable skill or motivation, as having conclusively identified 
the effects of Registered Apprenticeship on earnings. Moreover, the 
estimates do not represent increments between RAPs and IRAPs (the 
latter not having been implemented at the time the study was 
conducted).
---------------------------------------------------------------------------

    Commenters agreed with the Department that the RAP model is highly 
successful because of its emphasis on both high-quality training and 
apprentice safety and welfare and agreed with the Department's position 
that IRAPs are not designed to uniformly promote these core elements of 
quality apprenticeship programs. For example, several commenters, in 
expressing support for the Department's 2021 IRAP Rescission NPRM, 
remarked that RAPs offer protection and standards to ensure quality 
among the hallmarks of apprenticeship--high-quality training, including 
OJL and RI, safety and welfare, progressive wages, EEO protections, and 
worker empowerment. One commenter argued that Registered Apprenticeship 
is a proven model that consistently provides quality training and 
employment opportunities, and another commenter stated that the RAP 
model's balance of regulatory oversight and standardized training 
requirements produces workers with skillsets that lead to family-
sustaining careers. In addition, in noting their support for the 
Department's 2021 IRAP Rescission NPRM, several commenters compared the 
RAP model with that of IRAPs, agreeing with the Department's 
determination that the IRAP model neither adequately ensures high-
quality training nor apprentice safety and welfare.
    Commenters also provided suggestions on how to improve Registered 
Apprenticeship. One commenter suggested that the Department use lessons 
learned from the IRAP model to strengthen Registered Apprenticeship, 
specifically recommending that the RAP model should emphasize the 
assessment of competencies, use third-party capstone industry-
recognized certifications, and require a program evaluation component 
with an emphasis on outcomes. Another commenter, in expressing support 
for the 2021 IRAP Rescission NPRM, suggested that resources be 
refocused on aggressive oversight of RAPs to ensure the protection of 
apprentices, including investigation into the amount and source of 
funding for the operation of a RAP; the adequacy of the facilities and 
equipment used for training; adequacy of plans for retraining graduates 
to upgrade skillsets; the track record of the RAP sponsor; and whether 
the sponsor has the ability to provide broad-based training that will 
prepare apprentices to

[[Page 58275]]

be marketable in an industry-recognized occupation.
    The Department appreciates these comments that support its 2021 
IRAP Rescission NPRM. The Department also appreciates and agrees with 
the comments characterizing the RAP model as highly successful because 
of its emphasis on protections and standards that ensure high-quality 
training and apprentice safety and welfare. The Department agrees with 
the comments that assert that the IRAP model does not adequately ensure 
high-quality training or apprentice safety and welfare. With respect to 
the suggestions on how to improve Registered Apprenticeship, the 
Department acknowledges these comments and continues to be interested 
in ideas to expand Registered Apprenticeship while elevating important 
quality standards and promoting advancement opportunities for workers. 
The Department notes that the 2020 IRAP final rule does not mandate 
industry capstone certifications and that such mechanisms are not 
prohibited under the Registered Apprenticeship regulations. The 
Department continues to be interested in exploring ideas for 
strengthening the Registered Apprenticeship system and training model, 
and the Department appreciates these suggestions on how to make 
Registered Apprenticeship more successful for all workers and 
industries.
    A structured OJL model is a hallmark of a high-quality 
apprenticeship program, as this framework provides standardized 
evaluation of apprentice proficiency using a time-based model, 
competency-based model, or a hybrid of both, with benchmarks that 
ensure mastery in the apprentice's respective occupation and 
flexibility in the approach used that ensures apprenticeships can be 
developed and customized to a variety of occupations.\14\ OJL is a 
critical component for the apprentice's learning experience, and the 
Department considers a structured mentorship requirement as a strength 
for high-quality apprenticeship programs. RAPs pair apprentices with 
experienced employees (also referred to as journeyworkers) who have 
already mastered the skills and competencies associated with the 
occupation such that these individuals can mentor apprentices with on-
the-job guidance and direction that ensures safety and quality 
training. In contrast, the IRAP regulations lack a structured, 
standardized framework for OJL, resulting in inconsistent training 
across all SREs and IRAPs.
---------------------------------------------------------------------------

    \14\ RAP regulations at 29 CFR 29.5(b)(2) set forth the 
requirements for the term of apprenticeship, which for an individual 
apprentice may be measured either through the completion of the 
industry standard for OJL (at least 2,000 hours) (time-based 
approach), the attainment of competency (competency-based approach), 
or a blend of the time-based and competency-based approaches (hybrid 
approach).
---------------------------------------------------------------------------

    Another critical component of a RAP is RI.\15\ This RI provision is 
designed to ensure that apprentices uniformly receive meaningful and 
substantive knowledge in their respective occupations, creating a well-
rounded training experience that provides the educational foundation 
necessary for success in practical settings, while also retaining 
flexibility based on different industries and occupations that may 
require varying amounts of RI. In contrast, the IRAP regulations lack 
standards on minimum RI hours, and do not articulate how SREs monitor 
or evaluate RI.
---------------------------------------------------------------------------

    \15\ RI is an organized and systematic form of instruction 
designed to provide the apprentice with the knowledge of the 
theoretical and technical subjects related to the apprentice's 
occupation. Such instruction may be given in a classroom, through 
occupational or industrial courses, or by correspondence courses of 
equivalent value, electronic media, or other forms of self-study 
approved by the Registration Agency. 29 CFR 29.2. Under 29 CFR 
29.5(b)(4), a minimum of 144 hours of RI is recommended for 
Registered Apprenticeship; many RAPs exceed this 144-hour 
recommendation.
---------------------------------------------------------------------------

    The Department received several comments concerning OJL and RI. 
Several commenters, in expressing their support for the Department's 
2021 IRAP Rescission NPRM, agreed with the Department's assertion that 
the IRAP model lacks OJL and RI standards that are necessary to ensure 
high-quality training. One commenter argued that the 2020 IRAP final 
rule's lack of robust OJL requirements means that many IRAPs would not 
include this essential aspect of quality apprenticeship programs. 
Another commenter lauded the current OJL and RI requirements in the 
Registered Apprenticeship regulations \16\ and agreed with the 
Department's assertion that the 2020 IRAP final rule's requirement of 
only a written training plan \17\ means that IRAPs cannot create a 
standardized framework for quality training since quality of training 
can vary across SREs. Another commenter suggested that the RAP model 
benefits apprentices through robust requirements for OJL, which 
provides a holistic understanding of their specific field; the 
commenter also asserted that the RAP model is generally supported by a 
recommended minimum requirement for RI, which provides theoretical and 
technical education associated with an apprentice's profession. The 
same commenter argued that the absence of minimum standards and an 
articulated approach to evaluation for RI in the 2020 IRAP final rule 
results in subpar IRAP training relative to RAPs and a lower quality 
experience for employers and apprentices. Another commenter agreed with 
the Department and stated that the 2020 IRAP final rule's approach to 
OJL and RI is amorphous and inadequate. The commenter also referred to 
the Department's recent updates to its RAP guidance \18\ around 
flexibilities available in the delivery of OJL and RI to demonstrate 
that the RAP model can be flexible while still adhering to quality 
standards.
---------------------------------------------------------------------------

    \16\ See 29 CFR 29.5(b)(1) through (3) for OJL and 29.5b(4) for 
RI.
    \17\ See 29 CFR 29.22(a)(4)(ii).
    \18\ OA issued Circular 2021-01, Flexibilities Available for the 
Delivery of On-the-Job Learning (OJL) and Related Instruction (RI) 
by Registered Apprenticeship Programs (RAPs), on December 16, 2020. 
It is available at https://www.apprenticeship.gov/about-us/legislation-regulations-guidance/circulars.
---------------------------------------------------------------------------

    Another commenter, in expressing support for the proposed 
rescission, argued that the IRAP model also failed to incorporate 
apprenticeability standards, which appear at 29 CFR 29.4.\19\ The 
commenter argued that rescission of the 2020 IRAP final rule is 
important to ensure that apprentices receive broad-based training for 
in-demand skills because the 2020 IRAP final rule fails to account for 
apprentices' need to affordably retrain and update their skillsets. The 
commenter referred to three States--Delaware, New York, and 
Pennsylvania--that have included language in their apprenticeability 
standards that ensures skill development is not restricted to a single 
organization. Further, the commenter referred to Washington State's 
apprenticeability standard as one of the most stringent.
---------------------------------------------------------------------------

    \19\ Registered Apprenticeship regulations at 29 CFR 29.4 set 
forth criteria for determining when an occupation qualifies as 
apprenticeable.
---------------------------------------------------------------------------

    While not expressly opposing the Department's 2021 IRAP Rescission 
NPRM, two commenters, nevertheless, expressed their support of the 
general IRAP approach to OJL and RI, and suggested improvements to the 
RAP model based on the 2020 IRAP final rule. One of these commenters 
developed an IRAP-recognition procedure that the commenter described as 
``based on national and international standards [. . .] that, in turn, 
incorporate adult learning principles, validate content in alignment 
with industry, and produce rigorous and

[[Page 58276]]

validated assessment tools and personnel who are qualified to 
facilitate learning in the work environment.'' This commenter expressed 
the view that incorporating such a competency-based approach could 
strengthen outcomes for RAP apprentices by assuring industry and 
employers that competencies have been attained. The commenters 
recommended that all apprenticeships be based on competency and 
performance criteria rather than having the option of a time-based 
approach, and they stated that the Department should incorporate 
positive features of the 2020 IRAP final rule into a new, modified 
Registered Apprenticeship system. To this end, one of the commenters 
recommended that RAPs emphasize the assessment of competencies by using 
a third-party capstone industry-recognized certification and by 
requiring a program evaluation component with an emphasis on outcomes. 
The other commenter opined that the IRAP model's competency-based 
approach to learning is more cost effective than apprenticeship 
programs that are time-based. The commenter further asserted that IRAPs 
provide credit for prior knowledge for all workers, allowing 
individuals to complete apprenticeships more quickly. The same 
commenter stated that its IRAP ensures quality of OJL and apprentices' 
instruction by specifically using an assessment model tiered with 
several levels of quality assurance.
    The Department appreciates and agrees with the comments asserting 
that, when compared to Registered Apprenticeship, the IRAP model lacks 
OJL and RI requirements that are necessary to ensure high-quality 
training. The Department agrees with the comments that laud the RAP 
model's approach to OJL and RI, which provide a holistic understanding 
of a specific field and are generally supported by a recommended 
minimum requirement for RI that provides theoretical and technical 
education associated with an apprentice's profession. The Department 
also agrees that the standards and approach to evaluation for RI in the 
2020 IRAP final rule results in subpar training relative to RAPs and a 
lower quality experience for employers and apprentices. The Department 
concurs that the existing approach to OJL and RI in RAPs has proven 
effective in striking an appropriate balance between the structure 
necessary to ensure high-quality training and the flexibility necessary 
to adapt the apprenticeship model to different industries and 
occupations.
    In response to the comment that notes the 2020 IRAP final rule 
failed to incorporate apprenticeability standards, the Department 
concurs that the omission of the apprenticeability requirements from 
the 2020 IRAP final rule was problematic. The Department agrees that 
this omission is further support for the proposed rescission, as 
apprenticeability standards are a key component in determining whether 
an occupation's training is responsive to the needs of industry. The 
RAP model's incorporation of apprenticeability standards to determine 
whether proposed training is suitable for an occupation and responsive 
to industry needs underscores the quality of the existing RAP model.
    In response to the comments that expressed support of the IRAP 
model's approach to OJL and RI, the Department maintains that IRAPs do 
not have the same rigorous training standards for minimum skill level 
or competency baselines in their respective occupations when compared 
to RAPs. Regarding the commenter that stated that the IRAP model's 
competency-based approach to learning is more cost effective than 
apprenticeship programs that are time-based, the Department notes that 
the RAP model allows for a competency-based approach to OJL (see 29 CFR 
29.5(b)(2)(ii)) and permits RAP sponsors the ability to choose the 
approach--time-based, competency-based, or hybrid--that is best suited 
for their industry, programs, and apprentices. Regarding the same 
commenter's further assertion that IRAPs provide credit for prior 
knowledge for all workers, allowing individuals to complete 
apprenticeships more quickly, the Department notes that the RAP model 
also permits sponsors to grant advanced standing or credit for 
demonstrated competency (see 29 CFR 29.5(b)(12)). Finally, in response 
to the same commenter that stated its IRAP ensures quality of OJL and 
apprentices' instruction by specifically using an assessment model 
tiered with several levels of quality assurance, the Department 
acknowledges that while the commenter's specific IRAP may implement 
several levels of quality assurance for its OJL and RI, the 2020 IRAP 
final rule fails to ensure that all IRAPs include such quality 
standards for OJL and RI.
    In response to the comments that suggest improvements to the RAP 
model's approaches to OJL and RI, the Department appreciates the 
commenters' recommendation concerning the assessment of competencies as 
a key measure for evaluating the successful completion of a RAP by an 
apprentice but notes that adoption of these suggestions are outside the 
scope of this rulemaking. The Department also notes that the RAP 
regulations at 29 CFR 29.2 define ``competency'' as ``the attainment of 
manual, mechanical or technical skills and knowledge, as specified by 
an occupational standard and demonstrated by an appropriate written and 
hands-on proficiency measurement.'' Accordingly, competency attainment 
is the basis for advancement through and successful completion of both 
the competency-based and hybrid approaches in RAPs. The Department is 
committed to expanding competency attainment models as a feature of 
RAPs while also ensuring the acquisition of critical structured OJL 
necessary to acquire these competencies. Such models should include 
sufficient mentoring opportunities for apprentices to obtain 
proficiency in the skilled occupation.
    The Department acknowledges this comment regarding the utility of 
third-party evaluation of an apprentice's competencies in 
apprenticeship program design and is committed to continuing to study 
effective RAP models, identify research and evidence-based practices, 
and evaluate their outcomes.

B. Registered Apprenticeships Provide Better Safety and Welfare 
Protections

    The importance of apprentice safety and welfare cannot be 
overstated. As discussed in the 2021 IRAP Rescission NPRM and 
reiterated below, the Registered Apprenticeship system includes 
enhanced requirements related to safety, EEO, progressive wages, and 
other worker protections that provide apprentices with meaningful 
employment opportunities while also guaranteeing rights and protections 
on the job. In contrast, the requirements of the 2020 IRAP final rule 
fall short in these areas. That final rule's requirements include basic 
compliance with existing laws but do not create additional obligations 
that focus on safeguarding the welfare of apprentices, especially with 
respect to progressively increasing wages, safety requirements, and EEO 
protections and requirements. The 2021 IRAP Rescission NPRM also noted 
that the 2020 IRAP final rule dilutes the Department's role in 
overseeing apprenticeships, tasking SREs with this oversight role 
instead, and retaining only a minimal role in overseeing the SREs. The 
Department received several comments regarding these issues, which are 
discussed below.

[[Page 58277]]

1. Workplace Safety
    RAPs require several safety protections designed to both teach 
apprentices how to work safely within their occupation and create safe 
workplaces for apprentices.\20\ These safety requirements focus on both 
physical workplace safety and safety through training and mentorship. 
Further, they are meant to protect the safety of apprentices in each 
RAP by being tailored to the specific conditions in which those 
apprentices will be working and learning. In contrast, IRAPs are not 
covered by enhanced safety standards beyond generally applicable 
Federal, State, and local safety laws and regulations and any 
additional safety requirements of the SRE.
---------------------------------------------------------------------------

    \20\ See 29 CFR 29.5(b)(7) and (9).
---------------------------------------------------------------------------

    Several comments in support of the 2021 IRAP Rescission NPRM 
discussed the strength of Registered Apprenticeship's worker safety 
protections. For example, one commenter noted that the Registered 
Apprenticeship safety framework has proven effective in striking the 
right balance between safety, quality, and flexibility across 
industries. Further, the commenter highlighted the strength of 
Registered Apprenticeship's safety parameters, to include ratios, 
supervision, and training requirements. Another commenter highlighted 
the importance of a safe training environment for apprentices in RAPs, 
with an emphasis on data from the construction industry about the 
inherent dangers to younger, less experienced workers. The commenter 
described how RAPs include extensive safety training as well as 
supervision and on-the-job training to ensure the work environment is 
safe. These commenters also contrasted the Registered Apprenticeship 
safety protections with the 2020 IRAP final rule. One commenter 
highlighted the lack of required safety training in the 2020 IRAP final 
rule and offered that a mere pledge to comply with workplace safety 
laws was insufficient to adequately protect apprentices. Another 
commenter acknowledged the construction industry exclusion from the 
2020 IRAP final rule but expressed concern that some industry programs 
could still be recognized as IRAPs, which in the commenter's view would 
create parallel systems that would dilute safety requirements and 
affect overall industry safety for apprentices, journeyworkers, and the 
public. A commenter faulted the 2020 IRAP final rule for merely 
requiring IRAPs to abide by Federal, State, and local safety laws and 
for providing SREs with too much discretion to establish their own 
safety standards, leading to less rigorous safety requirements that 
could result in unsafe training programs and high-risk workplaces. 
Finally, a commenter contrasted the safety requirements for RAPs in the 
Registered Apprenticeship regulations at 29 CFR 29.5 with the lack of 
an apprentice-to-journeyworker ratio in the 2020 IRAP final rule at 29 
CFR 29.22 to ensure a level of supervision necessary for apprentice 
safety.
    The Department appreciates these comments and agrees that 
Registered Apprenticeship's worker safety provisions are designed to 
provide stronger protections than provided in the 2020 IRAP final rule. 
The Department views the enhanced safety requirements in Registered 
Apprenticeship regulations as an essential element of a successful 
apprenticeship program, given the nature of apprenticeship as OJL and 
training. The focus in the Registered Apprenticeship regulations on 
both workplace safety standards and safety through training and 
mentorship provides a multi-pronged approach to worker safety. 29 CFR 
29.5(b)(7) and (9). The Department agrees with the commenters' 
assessments that the safety requirements in Registered Apprenticeship 
are rigorous enough to provide essential protection and training for 
apprentices as well as flexible and adaptable enough to each workplace 
and industry needs. The Department also agrees with commenters' 
assessments of the 2020 IRAP final rule requirements at Sec.  
29.22(a)(4) as being insufficient to provide a safe training 
environment for apprentices. Likewise, the Department agrees that the 
2020 IRAP final rule instead inadvisably gives discretion to the SRE on 
the important matter of apprentice safety, potentially leading to both 
inconsistencies and deficient safety requirements across IRAPs even 
within the same industry. With respect to the construction industry 
exclusion from the 2020 IRAP final rule in Sec.  29.30, the Department 
acknowledges concerns that IRAPs could have been recognized in the 
construction industry despite the exclusion in the 2020 IRAP final 
rule. Although the Department views the explicit construction industry 
exclusion from the 2020 IRAP final rule as an appropriate safeguard 
against such potential outcomes, the Department's decision to rescind 
the 2020 IRAP final rule resolves concerns about potential weaknesses 
in the 2020 IRAP final rule's construction industry exclusion.
2. Progressive Wages
    It is a priority of the Department to grow opportunities to help 
workers access family-sustaining jobs. The RAP earn-as-you-learn model 
accomplishes this priority by providing for progressively increasing 
wages for apprentices as they progress in their apprenticeship 
experience, learning, and skills. In Registered Apprenticeship, the 
graduated scale of wages and any compensation for RI is set forth in 
the apprenticeship agreement required for each apprentice. Not only is 
this type of wage progression guaranteed per the terms of the 
apprenticeship agreement, but it also serves as an important incentive 
to attract apprentices and sets them on a path to family-sustaining 
careers. In contrast, there is no such guaranteed wage progression for 
apprentices of IRAPs--an apprentice could be earning the same wages 
over the course of the apprenticeship, and any wage progression is 
solely at the discretion of the IRAP.
    Several commenters in support of the 2021 IRAP Rescission NPRM 
discussed the importance of Registered Apprenticeship's progressive 
wage requirements. A couple of commenters cited research showing that 
apprentices who successfully complete RAPs accrue, over the course of 
their careers, approximately $300,000 more in salary and benefits than 
similarly situated workers who have not completed a RAP.\21\ Another 
commenter described RAPs as providing ``a pathway to the middle class'' 
because apprentices are guaranteed to receive higher wages as they 
advance and complete training requirements.
---------------------------------------------------------------------------

    \21\ See, e.g., Mathematica Policy Research, ``An Effectiveness 
Assessment and Cost-Benefit Analysis of Registered Apprenticeship in 
10 States: Final Report,'' July 25, 2012, https://wdr.doleta.gov/research/FullText_Documents/ETAOP_2012_10.pdf. The study cautions 
against interpreting its results, which do not control for 
unobservable skill or motivation, as having conclusively identified 
the effects of Registered Apprenticeship on earnings. Moreover, the 
estimates do not represent increments between RAPs and IRAPs (the 
latter not having been implemented at the time the study was 
conducted).
---------------------------------------------------------------------------

    These commenters also faulted the IRAP model for failing to require 
progressive wage increases for participants. One commenter expressed 
concern that failing to require progressive wages would decrease the 
attractiveness of IRAPs, lead to lower completion rates, and worsen 
employee loyalty. One commenter expressed that the 2020 IRAP final 
rule's lack of progressive wage requirement undermined the pathway to 
the middle class because IRAPs are permitted to

[[Page 58278]]

offer a single wage rate that never increases, even after apprentices' 
complete months or years of training.
    A commenter expressed concern that IRAPs could subvert Davis-Bacon 
Act provisions that provide exemptions for apprentices in RAPs to be 
paid at an amount commensurate with their skill level for Federal 
construction contract positions. The commenter noted that this 
exemption allows an apprentice to gain firsthand experience through a 
robust training program with mentorship. Citing research, a commenter 
remarked that ``robust'' prevailing wage laws help States attract more 
apprentices and lead to improved safety on construction work sites.
    The Department agrees with the commenters that progressive wages 
are a critical element in successful apprenticeship programs both 
because they guarantee increases commensurate with the apprentice's 
experience and proficiency and because they lead apprentices on a path 
to higher lifetime earnings. The Department also agrees with these 
commenters that the absence of a requirement for a progressively 
increasing schedule of apprentice wages in the 2020 IRAP final rule is 
a fundamental shortcoming and is inconsistent with the Department's 
role in promoting the highest quality apprenticeship programs. The 
Department acknowledges one commenter's concern regarding Davis-Bacon 
wages and related concern that IRAPs could subvert these wage 
provisions to create instability in the construction apprenticeship 
program. The Department does not share this view, however, because the 
construction industry exclusion in the 2020 IRAP final rule was 
specifically designed to address this concern. Moreover, the 
Department's decision to rescind the 2020 IRAP final rule in its 
entirety will obviate any concerns about its potential negative impact 
on construction industry wages.
    One commenter in support of the 2020 IRAP final rule stated that 
IRAPs provide opportunities for job seekers to obtain profitable 
employment while earning a credential and developing ``specific 
industry-related skill sets.'' The commenter remarked that its practice 
was to create apprenticeship programs that pay a living wage, as 
determined by local workforce development boards.
    The Department acknowledges and appreciates that IRAPs may 
structure their programs to provide a path to family-sustaining 
employment, and that the commenter's particular IRAP may be one that is 
beneficial to its apprentices. The issue with the 2020 IRAP final rule, 
however, is that it does not set requirements in this regard--other 
than adherence to applicable laws--and therefore, IRAPs' wage 
structures may vary widely. IRAPs have broad discretion to structure 
their wages as they please and to include stagnant wages that do not 
provide a viable path to family-sustaining employment. For this reason, 
the Department does not view IRAPs' wage requirements as sufficiently 
meeting the Department's goal of ensuring high-quality apprenticeship 
programs.
3. Equal Employment Opportunity
    The Department views equity and equal opportunity as essential to 
the success of an apprenticeship program, and it notes its 
responsibility under E.O. 13985, ``Advancing Racial Equity and Support 
for Underserved Communities Through the Federal Government,'' 86 FR 
7009 (Jan. 20, 2021), to advance equity, civil rights, racial justice, 
and equal opportunity. Accordingly, the Registered Apprenticeship 
system has structured and specific requirements regarding equal 
opportunity, anti-harassment, affirmative action, utilization analyses 
and goals, targeted recruitment, outreach and retention, compliance, 
and enforcement. In contrast, the 2020 IRAP final rule only requires 
IRAPs to affirm their adherence to applicable Federal, State, and local 
laws and regulations pertaining to EEO.
    Commenters in support of the Department's 2021 IRAP Rescission NPRM 
highlighted the strength of the Registered Apprenticeship system's EEO 
requirements. One commenter remarked that the Registered Apprenticeship 
system's EEO requirements are especially important for women, people of 
color, and veterans.\22\ Another lauded the Registered Apprenticeship 
system's requirements to take affirmative steps to ensure EEO in 
apprenticeship. One commenter specifically noted the Registered 
Apprenticeship system's requirements to develop and maintain an 
extensive affirmative action plan, comprehensive recordkeeping, and 
complaint and enforcement provisions.
---------------------------------------------------------------------------

    \22\ Pursuant to 29 CFR 30.3, all apprentices and applicants for 
Registered Apprenticeship are protected against discrimination on 
the bases of race, color, religion, national origin, sex, sexual 
orientation, age (40 or older), genetic information, or disability. 
While the EEO in apprenticeship regulations do not specify veterans 
as a protected group, sponsors may specifically seek out veterans or 
give them preference in hiring as long as doing so does not 
discriminate on the basis of any of the protected characteristics 
covered by 29 CFR 30.3.
---------------------------------------------------------------------------

    Commenters were also critical of the 2020 IRAP final rule's lack of 
enhanced EEO provisions. One commenter faulted the 2020 IRAP final rule 
for failing to ensure EEO in its apprenticeship programs for 
underrepresented groups, including women, minorities, and individuals 
with disabilities. The commenter stated that merely requiring SREs to 
develop outreach strategies was insufficient because there was no 
requirement to implement such strategies. Another commenter similarly 
faulted the 2020 IRAP final rule for failing to require programs to 
comply with Registered Apprenticeship's EEO regulations at 29 CFR part 
30 and instead only requiring IRAPs to practice ``passive 
nondiscrimination'' and comply with a ``patchwork'' of Federal, State, 
and local antidiscrimination laws. Because of this, the commenter 
asserted that IRAPs do not comply with the Biden Administration's E.O. 
13985, ``Advancing Racial Equity and Support for Underserved 
Communities Through the Federal Government.'' The commenter argued that 
the 2020 IRAP final rule undermined diversity efforts in its industry 
and fails to protect minorities and other disadvantaged populations 
that would otherwise benefit from apprenticeship programs in its 
industry. By rescinding the 2020 IRAP final rule and redirecting 
resources to expansion of the Registered Apprenticeship system, the 
commenter said the Department would promote equity and equal 
opportunities to participate in training programs with a ``proven 
record of leading to middle-class jobs for all Americans.'' Similarly, 
another commenter agreed that IRAPs would not successfully expand 
opportunities to participate in apprenticeship programs to underserved 
populations because programs under the IRAP model are only required to 
affirm they will adhere to Federal, State, and local EEO laws and 
regulations. A commenter also noted the benefits of building upon and 
strengthening the successful Registered Apprenticeship program rather 
than allowing a parallel model ``to evolve through the shedding of 
strong EEO commitments, obligations, [and] accountability.''
    The Department appreciates and agrees with the comments in support 
of the Registered Apprenticeship system's part 30 regulations. The 
Department also agrees with the comments faulting the 2020 IRAP final 
rule for falling short by only requiring the bare minimum under 
applicable laws and minimal additional outreach responsibilities by the 
SREs that do not include a mechanism for accountability. The Department 
also agrees with the commenter who stated that the Department's focus 
on building and strengthening Registered

[[Page 58279]]

Apprenticeship would be the most effective path in ensuring successful 
apprenticeship programming for all U.S. workers.
    Conversely, a commenter opposed to the proposed rescission asserted 
that both IRAPs and RAPs are required to take affirmative steps to 
ensure EEO, and that IRAPs promote increased apprenticeship 
opportunities while continuing to safeguard the welfare of apprentices.
    The Department disagrees with this assertion. As noted in the 2021 
IRAP Rescission NPRM, the current regulations governing EEO in 
Registered Apprenticeship under 29 CFR part 30 require program sponsors 
to take affirmative steps to promote diversity and equity in 
apprenticeship and provide sponsors with the tools needed to reduce 
barriers to equal opportunity within their programs. The structured and 
specific EEO requirements in Registered Apprenticeship regarding equal 
opportunity, anti-harassment, affirmative action, utilization analyses 
and goals, targeted recruitment, outreach and retention, compliance, 
and enforcement are absent from the IRAP model. The IRAP model simply 
requires programs to affirm their adherence to applicable Federal, 
State, and local laws and regulations pertaining to EEO, but provides 
no specific mechanisms by which to measure effort and outcomes.
4. Worker Empowerment
    As mentioned in the 2021 IRAP Rescission NPRM, the Department 
generally believes the relationship between workers and employers must 
be balanced so workers have a voice in ensuring fair and safe work 
conditions. The requirement that Registered Apprenticeship agreements 
include specific terms ensures the apprentices have knowledge of their 
rights and responsibilities and empowers them to be informed 
participants in the program and employment relationship. Although the 
IRAP regulation at 29 CFR 29.22(a)(4)(x) also contains a written 
apprenticeship agreement requirement, each IRAP may determine which 
terms and conditions to include as long as the agreement is consistent 
with the SRE's requirements. Without parameters, this requirement 
contains little more than an honor system to ensure apprentices have 
meaningful information about the terms and conditions of their 
apprenticeship and how they can voice their concerns.
    Commenters in support of the Department's 2021 IRAP Rescission NPRM 
praised the Department's attention to worker empowerment. One commenter 
proposed that RAPs be further strengthened to empower workers in 
industries that lack union representation and achieve the Biden 
Administration goal of creating jobs ``to be filled by diverse, local, 
well-trained workers who have a choice to join a union.'' The commenter 
also agreed with the Department's reasoning that the apprenticeship 
agreement is crucial to ``articulating the standards of apprenticeship 
and the terms and conditions of employment'' given the required 
elements of the apprenticeship agreement. The commenter additionally 
praised RAPs for protecting apprentices by requiring periodic 
performance evaluations and only canceling an apprenticeship for ``good 
cause'' after a reasonable and time-limited probationary period that 
counts toward completion of the program. Other commenters similarly 
praised the RAP apprenticeship agreement requirements as a crucial tool 
for worker empowerment and success.
    Commenters highlighted the 2020 IRAP final rule's lack of worker 
empowerment provisions. One commenter faulted the 2020 IRAP final rule 
for failing to comply with the NAA's directive to safeguard 
apprentices' welfare by leaving undue discretion to SREs, failing to 
``establish the minimum standards necessary'' to ensure industries do 
not exploit new entrants to an industry, and failing to clarify the 
process for employee grievances or complaints. A commenter similarly 
stated that the 2020 IRAP final rule fails to appropriately empower 
workers through the lack of clarity on grievance procedures. A 
commenter also agreed with the Department's reasoning that the IRAP 
model's ``hands-off approach'' enables employers to ignore apprentice 
needs and asserted that apprentices participating in IRAPs would be at 
risk of sudden, arbitrary cancellation of their participation in a 
program. Commenters noted that there were no uniform requirements for 
IRAP apprenticeship agreements to include apprentice work plans and 
number of classroom hours needed for program completion.
    The Department views an apprenticeship agreement as a foundational 
requirement for worker empowerment and agrees that the RAP requirements 
for apprenticeship agreements provide apprentices with knowledge and 
awareness of the terms of their employment and training during the 
apprenticeship. As commenters noted, unlike in the 2020 IRAP final 
rule, the apprenticeship agreement for RAPs must contain specific 
terms, including a statement of the occupation for which the apprentice 
is training, the duration of the apprenticeship, the number of hours in 
the program (to include RI hours), the schedule of work processes, the 
graduated scale of wages to be paid, the standards of the 
apprenticeship program, dispute resolution, and an EEO statement. See 
29 CFR 29.7. Registered Apprenticeship agreements must also set forth 
the requirement that the apprenticeship agreement be canceled for 
``good cause,'' which provides additional protection for apprentices, 
as does the requirement to include information on grievance procedures. 
These elements of an apprenticeship agreement are not required in the 
2020 IRAP final rule, and the Department views their absence as a 
detriment to apprentices.
    The Department further agrees with commenters that the 2020 IRAP 
final rule's requirement for an IRAP apprenticeship agreement is 
insufficient to guarantee that apprentices are fully informed of the 
terms and conditions of their apprenticeship because the IRAP can 
determine which terms to include as long as the IRAP is consistent with 
its SRE's requirements. Because there are two levels of discretion for 
IRAP apprenticeship agreements--the SRE decides its required parameters 
and the IRAP determines which terms and conditions to include--
apprenticeship agreements can vary widely among IRAPs and may not 
include all provisions the Department thinks are necessary to protect 
the interests of apprentices.
    A commenter who supported IRAPs stated that the IRAP model does 
meet workers' needs by providing them with a clear sense of career 
trajectory and increased job satisfaction while also increasing loyalty 
and reducing turnover for employers. The Department acknowledges that 
an individual IRAP may structure its program to lead to such results. 
However, the Department does not view the requirements in the 2020 IRAP 
final rule as sufficient to provide apprentices with the information 
needed to make informed decisions or be knowledgeable about their 
rights and responsibilities during their apprenticeship.
5. Departmental Oversight
    In support of its proposal, the Department noted its concern with 
the oversight structure set forth in the 2020 IRAP final rule because 
the required safety and welfare provisions of the 2020 IRAP final rule 
are primarily overseen and enforced by SREs. The Department also 
described its limited ability to intervene in any disparities in worker 
protections or outcomes among IRAPs.

[[Page 58280]]

    Commenters agreed with these concerns, faulting the 2020 IRAP final 
rule for failing to ensure adequate Departmental oversight. For 
example, a commenter noted that the 2020 IRAP final rule provided the 
Department with almost no basis for evaluating SRE standards or IRAP 
recognition. Another commenter stated that the requirement for 
``reasonable'' and ``effective'' quality control between the SREs and 
IRAPs was not sufficient to ensure IRAP compliance with the minimal 
requirements of the 2020 IRAP final rule. This commenter also noted 
that SREs and IRAPs would have no reason to comply with the higher 
fiduciary standards under the Employee Retirement Income Security Act 
of 1974 (ERISA), in contrast to the majority of apprentices in RAPs 
being protected by ERISA. A commenter also expressed concern that the 
2020 IRAP final rule lacked an adequate quality assurance framework and 
that vesting oversight responsibilities with SREs would lead to 
disparities in the quality of IRAPs available, noting that there were 
few, if any, consequences for low-performing IRAPs. One commenter 
referenced the 2008 final rule, in which the Department concluded that 
delegation of oversight responsibilities to State Apprenticeship 
Councils failed to meet its obligation under the NAA, to argue that the 
Department similarly should conclude that delegation of oversight to 
SREs is prohibited under the NAA.
    The Department generally agrees that tasking SREs with oversight in 
the manner set forth in the 2020 IRAP final rule dilutes the 
Department's role in overseeing apprenticeship and concurs with the 
notion that the 2020 IRAP final rule's oversight provisions are less 
rigorous than those in the Registered Apprenticeship framework due to 
the Department's more limited role. The Department agrees that the lack 
of uniformity in the 2020 IRAP final rule could lead to disparities in 
IRAP quality that may go unchecked. The Department also acknowledges 
that the Department's reduced role in the 2020 IRAP final rule could 
present compliance challenges and, in combination with the insufficient 
apprentice safety and welfare provisions, could lead to less protection 
for apprentices--a fundamental reason for the Department's proposed 
rescission. The Department disagrees, however, that it inappropriately 
delegated its oversight responsibilities to SREs and that it did so in 
a manner inconsistent with the NAA. The Department considered this 
issue in developing the 2019 IRAP NPRM and the 2020 IRAP final rule and 
views the oversight provisions in the 2020 IRAP final rule, which 
include SRE reporting requirements and the Department's oversight of 
SREs, to be consistent with the NAA. That said, in rescinding the 2020 
IRAP final rule, the Department has determined that, for the reasons 
discussed in the NPRM and provided by the commenters, the better 
approach is for the Department to have a more direct oversight role 
than provided for in the 2020 IRAP final rule.
6. Other Worker Protection Concerns
    The Department received comments in support of the proposed IRAP 
rescission offering additional criticisms that the 2020 IRAP final rule 
fails to protect apprentices and proposing additional bases for the 
rescission of the 2020 IRAP final rule. Commenters raised several 
concerns, in addition to the reasons set forth by the Department in the 
2021 IRAP Rescission NPRM, related to IRAPs' impact on apprentice 
safety and welfare. One commenter expressed the view that the SRE 
recognition process was flawed because it did not provide for adequate 
input from industry experts, stakeholders, or members of the public in 
reviewing SRE applications and did not provide for their subsequent 
involvement in SRE recognition of IRAPs. The commenter noted that the 
2020 IRAP final rule's processes for suspension or derecognition of an 
SRE are an ``inadequate remedy'' to protect apprentices who have spent 
their time and money on a poor-quality program. This commenter also 
expressed the view that allowing IRAPs to maintain their status for 1 
year despite their SRE's derecognition further deprives apprentices of 
protection without recourse with the IRAP regardless of the quality of 
the program that the derecognized SRE recognized.
    The Department generally agrees with the comment about the lack of 
effective industry and public involvement in the IRAP framework; such 
engagement can be instrumental to ensuring a high-quality 
apprenticeship system that is responsive to industry, employer, and 
worker needs. For example, as noted above, the apprenticeability 
process for RAPs under 29 CFR 29.4 is one instance in which interested 
stakeholders and industry are invited to share their expertise about 
the suitability of certain occupations for apprenticeship training. The 
Department also agrees that the 2020 IRAP final rule lacked protections 
for apprentices if SREs were suspended or derecognized, particularly by 
allowing IRAPs to maintain their status for 1 year after SRE 
derecognition without any additional protections for their apprentices.
    Some commenters noted that the design of SRE-IRAP recognition in 
the 2020 IRAP final rule led to inherent conflicts of interest that 
would leave apprentices vulnerable. One commenter argued that SREs and 
IRAPs were incentivized to do only the bare minimum necessary to comply 
rather than seeking to satisfy higher standards and requirements. This 
commenter also expressed the view that there were inadequate safeguards 
against self-dealing between SREs and their affiliates and that SREs 
were responsible for policing their own conflicts of interest. This 
commenter expressed the belief that IRAPs' on-the-job training could 
lead to an apprentice being treated as an independent contractor and 
that the IRAP model fails to ensure participants are protected by 
ERISA. A commenter also asserted that SREs could not be impartial in 
their recognition of IRAPs because of the industry-driven nature of the 
2020 IRAP final rule and wide flexibility in recognition of SREs and 
IRAPs.
    The Department appreciates the commenters' concerns about these 
perceived deficiencies in the 2020 IRAP final rule. The Department 
generally agrees with the commenters that IRAPs provide insufficient 
protection for apprentices, as discussed in the NPRM and above. The 
Department also generally agrees that the 2020 IRAP final rule does not 
eliminate risks of conflicts of interest or apprentice 
misclassification. Nonetheless, the Department does not view the 
concerns raised about conflicts of interest or apprentice 
misclassification as additional bases for rescission of the 2020 IRAP 
final rule. With respect to conflicts of interest, the Department notes 
that it discussed conflicts of interest at length in the 2020 IRAP 
final rule and added specific provisions to increase transparency and 
mitigate against conflicts of interest during the SRE recognition 
process. See 85 FR 14309-14312, 14336-14339 (Mar. 11, 2020). 
Additionally, the apprenticeship agreement requirement in the 2020 IRAP 
final rule provides some protection against apprentice 
misclassification, though the Department acknowledges that it does not 
eliminate the risk of such misclassification. As discussed above, the 
Department does not view the apprenticeship agreement requirement in 
the 2020 IRAP final rule as sufficient to inform apprentices of the 
terms and conditions of their apprenticeship. Finally, ERISA 
requirements are binding on all employee benefit plans, and the

[[Page 58281]]

2020 IRAP final rule does not allow SREs or IRAPs that constitute such 
plans to circumvent ERISA's obligations. While the Department does not 
agree with these commenters' specific concerns as the bases for IRAP 
rescission, these features of the 2020 IRAP final rule do not overcome 
the deficiencies that have led the Department to rescind the 2020 IRAP 
final rule.

IV. The IRAP System Is Redundant of the Registered Apprenticeship 
System

    In the 2021 IRAP Rescission NPRM, the Department asserted that a 
key premise justifying the establishment of the IRAP alternative 
framework--that the Registered Apprenticeship system is too inflexible 
and administratively burdensome to sufficiently accommodate the needs 
of both industry and workers--is contradicted by the notable gains made 
in the RAP model through such strategies as the Industry Intermediaries 
concept \23\ and the AAI grants.\24\
---------------------------------------------------------------------------

    \23\ Since 2016, the Department has launched funding 
opportunities for Industry Intermediaries to develop, promote, and 
expand the availability of and access to Registered Apprenticeships 
across the United States. See https://www.apprenticeship.gov/investments-tax-credits-and-tuition-support (last visited May 19, 
2022). Through these investments, Industry Intermediaries have 
expanded Registered Apprenticeship into new industry sectors and 
occupations, worked with sponsors to ensure that diverse and 
underrepresented populations are connected to Registered 
Apprenticeship opportunities, and promoted Registered Apprenticeship 
as a workforce solution. An OA fact sheet highlighting the 
accomplishments these entities have made to accommodate the needs of 
workers and industry is available at https://www.apprenticeship.gov/sites/default/files/Industry-and-Equity-Intermediary-Accomplishment-Fact-Sheet.pdf (last visited May 19, 2022).
    \24\ In 2015, the Department launched the AAI to expand 
Registered Apprenticeship in the United States, particularly in 
high-growth and high-tech industries, such as healthcare, IT, and 
advanced manufacturing, as well as to populations traditionally 
underrepresented in apprenticeship, including women, people of 
color, and individuals with disabilities. Through AAI, AAI grantees 
have successfully expanded the RAP model into new industries and 
extended it to more diverse populations. For more information, see 
National Governors' Association Report, ``Registered Apprenticeship 
Reimagined: Lessons Learned from the American Apprenticeship 
Initiative,'' Nov. 9, 2020, available at https://www.nga.org/center/publications/registered-apprenticeship-reimagined.
---------------------------------------------------------------------------

    Commenters in support of the Department's 2021 IRAP Rescission NPRM 
expressed concerns that the 2020 IRAP final rule would, over time, 
undermine the integrity of Registered Apprenticeship, create confusion, 
and generate unnecessary duplication. One commenter remarked that 
creating two distinct apprenticeship systems with different policies 
and regulations could lead to inconsistent training for apprentices, 
which would negatively impact their skills and marketability. The 
commenter also viewed the IRAP framework as devaluing apprenticeship. 
Another commenter echoed these concerns and asserted the establishment 
of a duplicative, parallel system, which is not responsive to employers 
or workers, would lead to confusion and disparate outcomes for 
apprentices. A number of commenters expressed concern that the IRAP 
model undermines investments in the proven RAP model and could 
disincentivize the creation of new apprenticeship programs.
    The Department agrees with the concerns expressed by these 
commenters. The inherent confusion and redundancy created by parallel 
systems was a significant factor in the Department's proposal to 
rescind the 2020 IRAP final rule, as was the Department's concern about 
disparate outcomes resulting from a lack of uniformity across programs.

V. The Effect of the Department's Rescission of the 2020 IRAP Final 
Rule

    For the reasons discussed above, the Department has determined that 
the IRAP model established in the 2020 IRAP final rule does not ensure 
access to high-quality job skills and training to American workers, nor 
does it adequately safeguard the welfare of apprentices. The Department 
has further concluded that because the IRAP system duplicates the 
Registered Apprenticeship system, though with less quality standards 
and oversight, continuing to operate the IRAP system is not a prudent 
use of Government resources and would diminish the quality and 
coherence of the Department's apprenticeship efforts.
    In considering alternatives, the Department also has determined 
that amending, rather than rescinding, the 2020 IRAP final rule would 
not address these issues. As discussed in detail above, Registered 
Apprenticeship provides for apprentice safety and welfare and continues 
to nurture apprenticeship opportunities without sacrificing crucial 
requirements for quality or worker protections. Amending the 2020 IRAP 
final rule to align with the Department's goals and priorities so that 
the IRAP model possesses more of the qualities of Registered 
Apprenticeship, however, would simply recreate the RAP model with less 
oversight by the Department. Rather than administer two parallel 
programs, the Department can better utilize its resources and provide 
better service to the public by supporting and strengthening one robust 
apprenticeship system that has been designed to incorporate the needs 
of both industry and the workforce. The Department therefore has 
decided to adopt the NPRM as proposed.
    As stated in the 2021 IRAP Rescission NPRM, the Department 
acknowledges this final rule does immediately affect current SREs, 
IRAPs, and the apprentices participating in IRAPs. The Department 
understands SREs devoted resources to developing their applications and 
the infrastructure necessary to operate effectively for a period of 5 
years, and IRAPs and their apprentices may have been drawn to the 
program given the indication of approval from the Department. However, 
the impact of this rescission will be limited. Over the 9-month period 
between May 2020, when the 2020 IRAP final rule became effective, and 
February 2021, when the Department paused the consideration of SRE 
applications, the Department received a total of 45 SRE applications, 
including from two organizations that resubmitted applications. Of 
these applications, the Department ultimately recognized 27 SREs.\25\ 
For FY 2021, covering the period of October 1, 2020, through September 
30, 2021, 6 of the 27 recognized SREs recognized 178 IRAPs, which 
served 23,975 apprentices. A single SRE recognized the majority of the 
IRAPs (167).\26\ The rescission of the 2020 IRAP final rule does not 
require that the SREs and the IRAPs they have recognized cease their 
operations; rather, this action only requires that these entities cease 
indicating that they are recognized by or associated with OA. The 
apprentices enrolled in the existing IRAPs can continue to receive 
training from the program uninterrupted. Alternatively, those 
apprenticeship programs can seek registration with a Registration 
Agency (either OA or a recognized SAA). Even if the IRAP does not seek 
such registration, those apprentices currently enrolled in an IRAP can 
seek to transfer into a RAP. In addition, IRAP apprentices moving into 
a RAP, either on their own or because their IRAP has been registered as 
a RAP with a Registration Agency, may qualify for

[[Page 58282]]

advanced standing or credit in those RAPs. Moreover, as the 2020 IRAP 
final rule requires only basic compliance with existing federal, state, 
and local laws governing employees, and does not provide any further 
protections that would enhance the safety and welfare of apprentices, 
the Department believes that the issuance of this final rule will not 
adversely affect the existing rights and protections of IRAP 
apprentices impacted by this rescission.
---------------------------------------------------------------------------

    \25\ Applications received by the Department for SREs. Approved 
SREs published at https://www.apprenticeship.gov/employers/industry-recognized-apprenticeship-program/approved-standards-recognition-entities (last visited May 19, 2022).
    \26\ According to the IRAP Program and Performance Reporting 
System, as of September 30, 2021, of the 175 IRAPs approved, 167 
were recognized by the same SRE. See https://www.apprenticeship.gov/sites/default/files/SRE-FY21-performance-data.pdf (last visited 
September 6, 2022).
---------------------------------------------------------------------------

    Several commenters referred to the Department's acknowledgement 
that rescinding the 2020 IRAP final rule would affect current SREs, 
IRAPs, and any apprentices participating in IRAPs. Two commenters 
agreed with the Department's position that the overall impact of the 
rescission to SREs, IRAPs, and apprentices in IRAPs would be minimal 
based on the reported data. Of these comments, one commenter said the 
data suggest that IRAPs have not been widely adopted and therefore will 
not likely be effective or successful. One commenter presented an 
alternative view, suggesting that the number of recognized SREs and 
IRAPs since the issuance of the 2020 IRAP final rule is significant 
relative to the amount of time for which the rule has been effective. 
Another commenter remarked that the number of recognized SREs and IRAPs 
since the issuance of the 2020 IRAP final rule should not be understood 
as a lack of interest from the business community but rather as a 
reflection of the broader impact of the COVID-19 pandemic on industry.
    The Department appreciates the comments supporting its analysis in 
the 2021 IRAP Rescission NPRM of the potential impact of the rescission 
of the 2020 IRAP final rule for SREs, IRAPs, and any apprentices 
participating in IRAPs. The Department acknowledges the comment 
suggesting the number of recognized SREs and IRAPs since the issuance 
of the 2020 IRAP final rule is significant relative to the amount of 
time for which the rule has been effective. As discussed below in 
Section VI.A.2, Economic Analysis of Executive Orders 12866 (Regulatory 
Planning and Review and 13563 (Improving Regulation and Regulatory 
Review), the Department notes that the actual number of recognized SREs 
and IRAPs is lower than anticipated in Economic Analysis of the 2020 
IRAP final rule (85 FR 14357-14358, Mar. 11, 2020). However, regardless 
of the number of current SREs and IRAPs, the Department, for the 
reasons discussed above, has concluded that rescission of the IRAP 
regulation is appropriate. The rescission of the 2020 IRAP final rule 
does not require that the SREs and the IRAPs they have recognized cease 
their operations. This rescission only requires that these entities 
cease indicating that they are recognized by or associated with OA. 
Further, as stated above, there are multiple avenues for IRAPs to 
continue operation, either as independent apprenticeship programs or by 
seeking registration with OA, and for apprentices to receive training, 
either in their current program or in a RAP. Thus, the Department 
maintains that the impact of the rescission will be limited and 
outweighed by the benefits of rescission discussed above.
    The Department also acknowledges that the COVID-19 pandemic had 
broad societal impacts, including on the business community, which may 
have had an impact on both RAPs and IRAPs. While the COVID-19 pandemic 
may have had a negative impact on IRAPs, as the commenter asserted, in 
contrast, despite the COVID-19 pandemic, FY 2021 represented the 
fourth-highest year of new RAP development over the past decade, with 
over 2,800 new RAPs developed.\27\
---------------------------------------------------------------------------

    \27\ These figures reflect Registered Apprenticeship national 
results and are available at https://www.dol.gov/agencies/eta/apprenticeship/about/statistics/2021 (last visited September 6, 
2022).
---------------------------------------------------------------------------

    In the 2021 IRAP Rescission NPRM, the Department considered other 
options with respect to the currently recognized SREs or IRAPs, 
including a proposed ``sunset'' period during which SREs and IRAPs 
would operate for a set number of years before the Department ceased 
its recognition, and recasting IRAPs as Certified Work-Based Learning. 
The Department did not receive any specific comments on these two 
options. One commenter stated that returning to a single RAP model and 
``[i]mmediate rescission of the [2020 IRAP final rule] is superior to 
any other alternative course of action.'' The commenter noted that, 
based on the reported data at the time of the NPRM, it was evident that 
private industry has rejected IRAPs as a vehicle for training workers. 
As such, the commenter asserted there are no disadvantages to 
rescinding the 2020 IRAP final rule now. The Department agrees that 
rescinding the 2020 IRAP final rule and immediate cessation of 
recognition for currently recognized SREs or IRAPs is appropriate in 
light of the concerns discussed above.

Transition to and Implementation of the Final Rule

    In the 2021 IRAP Rescission NPRM, the Department sought comments on 
how to address the effects of the proposed immediate cessation of 
recognition on SREs, IRAPs, and apprentices in IRAPs, including 
comments on the alternatives considered, but ultimately not adopted, by 
the Department. One commenter suggested the Department continue to 
explore efforts to develop industry-driven apprenticeship programs and 
continue to establish and strengthen workforce development initiatives 
that partner with business. Another commenter recommended that the 
Department provide technical assistance to build the capacity of SREs 
and IRAPs to offer high-quality apprenticeships, even if they operate 
outside of the Registered Apprenticeship system.
    The Department, as noted, is rescinding its recognition of SREs 
under this final rule; however, it continues to expand and further 
develop the Registered Apprenticeship system as a premier workforce 
development strategy. The Department appreciates the suggestions that 
it continue to develop workforce development initiatives that partner 
with business and industry, and it notes their integral role in the 
Registered Apprenticeship system. This final rule does not prevent 
IRAPs from continuing to offer a range of training options to job 
seekers. The Department is interested in continuing to promote more 
work-based learning strategies in its employment and training programs, 
with an increased emphasis on RAP models as a proven solution for both 
career seekers and business.
    Additionally, the Department has provided and will continue to 
provide technical assistance and support to SREs or IRAPs that are 
interested in becoming program sponsors or intermediaries under the 
Registered Apprenticeship system. Similarly, as a component of the 
Department's technical assistance to SREs, the Department will provide 
SREs and IRAPs with information and resources the SREs can share with 
any apprentices in IRAPs who may seek placement in a RAP.

VI. Regulatory Analysis and Review

A. Executive Orders 12866 (Regulatory Planning and Review) and 13563 
(Improving Regulation and Regulatory Review) and Subtitle E of the 
Small Business Regulatory Enforcement Fairness Act of 1996

    Under E.O. 12866, the Office of Management and Budget's (OMB) 
Office of Information and Regulatory Affairs (OIRA) determines whether 
a regulatory action is significant and, therefore, subject to the 
requirements of the E.O. and review by OMB. See 58 FR 51735

[[Page 58283]]

(Oct. 4, 1993). Section 3(f) of E.O. 12866 defines a ``significant 
regulatory action'' as an action that is likely to result in a rule 
that: (1) has an annual effect on the economy of $100 million or more, 
or adversely affects in a material way a sector of the economy, 
productivity, competition, jobs, the environment, public health or 
safety, or State, local, or Tribal Governments or communities (also 
referred to as economically significant); (2) creates serious 
inconsistency or otherwise interferes with an action taken or planned 
by another agency; (3) materially alters the budgetary impacts of 
entitlement grants, user fees, or loan programs, or the rights and 
obligations of recipients thereof; or (4) raises novel legal or policy 
issues arising out of legal mandates, the President's priorities, or 
the principles set forth in the E.O. Id. OIRA has determined that this 
final rule is an economically significant regulatory action under 
section 3(f) of E.O. 12866.
    E.O. 13563 directs agencies to propose or adopt a regulation only 
upon a reasoned determination that its benefits justify its costs; the 
regulation is tailored to impose the least burden on society, 
consistent with achieving the regulatory objectives; and in choosing 
among alternative regulatory approaches, the agency has selected those 
approaches that maximize net benefits. E.O. 13563 recognizes that some 
benefits are difficult to quantify and provides that, where appropriate 
and permitted by law, agencies may consider and discuss qualitatively 
values that are difficult or impossible to quantify, including equity, 
human dignity, fairness, and distributive impacts.
    Pursuant to Subtitle E of the Small Business Regulatory Enforcement 
Fairness Act of 1996, also known as the Congressional Review Act (5 
U.S.C. 801 et seq.), OIRA designated this rule as a ``major rule,'' as 
defined by 5 U.S.C. 804(2).
1. Public Comments
    In the preliminary economic analysis in the 2021 IRAP Rescission 
NPRM, the Department invited written comments from the public 
concerning the potential number of SREs and IRAPs in the absence of the 
proposed rule and the removal of the February 17, 2021, suspension, as 
well as on possible alternatives to the proposed rule. Only one 
commenter submitted comments pertaining to the preliminary economic 
analysis. The commenter stated that the rescission of the 2020 IRAP 
final rule will result in cost savings in excess of those set forth in 
the proposed rule; in particular, savings will be realized when 
Government grant money that would otherwise go to ``ineffective IRAPs 
and SREs'' is better used by RAPs. The commenter stated that, if 
resources are used for RAPs instead of ``wasted on IRAPs,'' workers 
will be safer, better protected, and more justly compensated, plus 
society will benefit from a greater diversity of apprentices, a larger 
tax base, increased employee loyalty, higher productivity, and 
additional skilled labor that will help address labor market demands. 
The commenter suggested that the monetary value of those additional 
benefits should be factored into the cost analysis.
    The Department appreciates the commenter's recognition of the 
benefits of RAPs to the U.S. economy and workforce. The Department 
agrees that supporting RAPs is a better use of grant funds than 
supporting IRAPs; accordingly, the Department has not issued grant 
funding specifically for IRAPs and does not plan to do so. The 
Department agrees that RAPs provide numerous benefits to apprentices, 
employers, taxpayers, and society, and that a quantification of these 
benefits would be ideal to include in the economic analysis. Due to 
data limitations, however, the Department cannot quantify the benefits 
listed by the commenter and has maintained a qualitative discussion in 
this final rule.
    The same commenter stated that returning to a single RAP model is 
the best course of action and rescinding the 2020 IRAP final rule is 
superior to any alternative. The commenter anticipates that the cost of 
transferring current IRAP participants to RAPs will be minimal and will 
be offset by the increased benefits that will accrue to IRAP trainees 
when they become RAP apprentices. The Department agrees that rescinding 
the 2020 IRAP final rule is the best course of action.
2. Economic Analysis
    E.O. 14016, ``Revocation of Executive Order 13801,'' instructed the 
Director of OMB and the heads of executive departments and agencies to 
``promptly consider taking steps to rescind any orders, rules, 
regulations, guidelines, or policies, or portions thereof, implementing 
or enforcing'' E.O. 13801. Accordingly, the Department identified for 
review the 2020 IRAP final rule. The Department is issuing this final 
rule because the Department has determined that a single apprenticeship 
system, namely, the Registered Apprenticeship system, will provide 
clearer messaging and more consistent outcomes than two parallel 
apprenticeship systems that likely would lead to disparate outcomes and 
incur duplicative costs.
    In accordance with the regulatory analysis guidance articulated in 
OMB Circular A-4 and consistent with the Department's practices in 
previous rulemakings, this regulatory analysis focuses on the likely 
consequences of this final rule. The Department anticipates that this 
final rule will result in cost savings for SREs and IRAPs since they 
will no longer need to comply with the provisions of the 2020 IRAP 
final rule.
    The Department has estimated the cost savings of this final rule 
relative to the existing baseline (i.e., 27 SREs and 178 IRAPs). The 
analysis covers 10 years to ensure it captures the major cost savings 
that are likely to accrue over time. The Department expresses the 
quantifiable impacts in 2021 dollars and uses discount rates of 3 and 7 
percent, pursuant to OMB Circular A-4. The Department also considered 
an alternative baseline in which the Department's February 17, 2021, 
suspension of consideration of SRE applications was temporary and would 
be removed. That analysis is discussed qualitatively in the Total Cost 
Savings section below.
a. Number of SREs, IRAPs, and Apprentices
    To calculate the annual cost savings, the Department first needed 
to estimate the number of SREs, IRAPs, and apprentices over the 10-year 
analysis period. The Department used the number of SREs (27), the 
number of IRAPs (178), and the number of apprentices in IRAPs (23,975) 
as of September 30, 2021, for this analysis.
b. Compensation Rates
    The compensation rates used to quantify the cost savings of this 
final rule are based on the compensation rates in the 2020 IRAP final 
rule. The Department updated the compensation rates with 2021 data. The 
Department anticipates that the bulk of the workload for private sector 
workers would have been performed by employees in occupations similar 
to those associated with the following Standard Occupational 
Classification (SOC) codes: SOC 11-3131 (Training and Development 
Managers) and SOC 43-0000 (Office and Administrative Support 
Occupations).
    According to the U.S. Bureau of Labor Statistics (BLS), the mean 
hourly wage rate for Training and Development Managers in May 2021 was 
$61.92.\28\ For this analysis, the Department used

[[Page 58284]]

a fringe benefits rate of 45 percent \29\ and an overhead rate of 54 
percent,\30\ resulting in a fully loaded hourly compensation rate for 
Training and Development Managers of $123.22 [= $61.92 + ($61.92 x 
0.45) + ($61.92 x 0.54)].
---------------------------------------------------------------------------

    \28\ BLS, ``Occupational Employment and Wages, May 2021,'' 
https://www.bls.gov/oes/current/oes113131.htm (last updated March 
31, 2022).
    \29\ BLS, ``Employer Costs for Employee Compensation'' (ECEC), 
https://www.bls.gov/ncs/data.htm (last visited May 19, 2022). Wages 
and salaries averaged $27.22 per hour worked in 2021, while benefit 
costs averaged $12.24, which is a benefits rate of 45 percent.
    \30\ U.S. Department of Health and Human Services (HHS), 
``Guidelines for Regulatory Impact Analysis,'' 2016, https://aspe.hhs.gov/system/files/pdf/242926/HHS_RIAGuidance.pdf. In its 
guidelines, HHS states, as ``an interim default, while HHS conducts 
more research, analysts should assume overhead costs (including 
benefits) are equal to 100 percent of pre-tax wages.'' HHS explains 
that 100 percent is roughly the midpoint between 46 and 150 percent, 
with 46 percent based on ECEC data that suggest benefits average 46 
percent of wages and salaries, and 150 percent based on the private 
sector ``rule of thumb'' that fringe benefits plus overhead equal 
150 percent of wages. To isolate the overhead costs from HHS's 100-
percent assumption, the Department subtracted the 46-percent 
benefits rate that HHS references, resulting in an overhead rate of 
approximately 54 percent.
---------------------------------------------------------------------------

    According to BLS, the mean hourly wage rate for Office and 
Administrative Support Occupations in May 2021 was $20.88.\31\ The 
Department used a fringe benefits rate of 45 percent and an overhead 
rate of 54 percent, resulting in a fully loaded hourly compensation 
rate for Office and Administrative Support Occupations of $41.55 [= 
$20.88 + ($20.88 x 0.45) + ($20.88 x 0.54)].
---------------------------------------------------------------------------

    \31\ BLS, ``Occupational Employment and Wages, May 2021,'' 
https://www.bls.gov/oes/current/oes430000.htm (last visited May 19, 
2022).
---------------------------------------------------------------------------

    The Department estimated the compensation rate for a Program 
Analyst in OA using the midpoint (Step 5) for Grade 13 of the General 
Schedule (GS), which is $56.31 in the Washington, DC, locality 
area.\32\ The Department used a fringe benefits rate of 69 percent \33\ 
and an overhead rate of 54 percent, resulting in a fully loaded hourly 
compensation rate for Program Analysts of $125.57 [= $56.31 + ($56.31 x 
0.69) + ($56.31 x 0.54)].
---------------------------------------------------------------------------

    \32\ Office of Personnel Management, ``General Schedule (GS) 
Locality Pay Tables,'' https://www.opm.gov/policy-data-oversight/pay-leave/salaries-wages/salary-tables/pdf/2021/DCB_h.pdf (last 
visited May 19, 2022).
    \33\ Congressional Budget Office, ``Comparing the Compensation 
of Federal and Private-Sector Employees, 2011 to 2015,'' Apr. 25, 
2017, https://www.cbo.gov/publication/52637. The wages of Federal 
workers averaged $38.30 per hour over the study period, while the 
benefits averaged $26.50 per hour, which is a benefits rate of 69 
percent.
---------------------------------------------------------------------------

c. Time Estimates
    The hourly time burdens used to quantify the cost savings of this 
final rule are based on the Department's time estimates in the 2020 
IRAP final rule. The following time burdens are annual estimates.
Cost Savings Components for SREs
 Notifying the Administrator of any major change to processes 
or programs: 10 hours (50 percent of SREs)
 Informing the Administrator of IRAP recognition, suspension, 
or derecognition: 30 minutes
 Provision of data or information to the Administrator: 2 hours 
(10 percent of SREs)
 Provision of written attestation to the Administrator: 10 
minutes per IRAP
 Disclosure of the credentials that apprentices will earn: 30 
minutes
 Quality control of IRAPs: 4 hours per IRAP
 Submission of performance data to the Administrator: 4 hours 
per IRAP
 Making publicly available IRAP performance data: 2 hours per 
IRAP
 Recordkeeping: 20 hours per IRAP
Cost Savings Components for IRAPs
 Submission of performance data to the SRE: 25 hours
 Preparation of written apprenticeship agreement: 10 minutes 
per apprentice
Cost Savings Components for the Federal Government
 Compliance assistance reviews of SREs: 10 hours per SRE (5 
percent of SREs)
 Maintenance of online application form and internal review 
system: $125,000
 Maintenance of online resource for performance measures: 
$245,909
 Maintenance of online resource for list of SREs and IRAPs: 
$18,000
d. Total Cost Savings
    Exhibit 1 shows the total estimated cost savings of the final rule 
over 10 years (2022-2031) at discount rates of 3 and 7 percent. The 
final rule is expected to have first-year cost savings of $1.8 million 
in 2021 dollars. Over the 10-year analysis period, the annualized cost 
savings are estimated at $1.8 million at a discount rate of 7 percent 
in 2021 dollars. In total, over the first 10 years, the final rule is 
estimated to result in cost savings of $12.9 million at a discount rate 
of 7 percent in 2021 dollars.
[GRAPHIC] [TIFF OMITTED] TR26SE22.007

    The Department also contemplated including an alternative baseline 
that assumed the Department's February 17, 2021, suspension of 
consideration of SRE applications would be removed. If the suspension 
were to be removed, there could be additional SREs and IRAPs in future 
years. OMB Circular A-4 defines a no action baseline as ``what the 
world will be like'' if the rule is not adopted. If the world did not 
include this rule, but included the removal of

[[Page 58285]]

the February 17, 2021, suspension as well as decision making by 
potential SREs in the manner anticipated in the 2020 IRAP final rule, 
it is possible that there would be more than 27 SREs and 178 IRAPs in 
each year of the analysis period. Given the potential temporary nature 
of the February 17, 2021, suspension, some members of the public may 
believe there will be an opportunity to participate in the program 
again in the absence of this rule. Under such a scenario, 27 SREs and 
178 IRAPs may be only fractions of the numbers of SREs and IRAPs that 
would come into existence, and perhaps those numbers would continue to 
grow throughout the analysis period. As such, this rule would then 
prevent some of the eventual effects of the 2020 IRAP final rule.
    The Department is unable, however, to provide a quantitative 
analysis of this alternative baseline. The Department does not have a 
way to accurately estimate the number of SREs or IRAPs that would be 
established in the absence of this rule and the removal of the February 
17, 2021, suspension. Specifically, the Department is unable to 
estimate a reasonable growth rate for SREs over the analysis period or 
a realistic number of IRAPs per SRE each year. Without these two key 
data points, a quantitative analysis is not possible.
    The Department believes that the numbers of SREs and IRAPs 
estimated in the 2020 IRAP final rule are not an appropriate source for 
quantifying an alternative baseline in this final rule. Over the 9-
month period between May 2020, when the 2020 IRAP final rule became 
effective, and February 2021, when the Department paused the 
consideration of SRE applications, data indicate that participation was 
far lower than what was projected in the 2020 IRAP final rule. To begin 
with, the number of SRE applications was far fewer than the number 
anticipated in the 2020 IRAP final rule. For the 2020 IRAP final rule, 
the Department used the number of entities that submitted grant 
applications under the AAI grant program in FY 2016 as a guidepost for 
estimating the number of SRE applications. It now seems that this 
guidepost was unrealistic because millions of dollars were awarded to 
each successful AAI grant application whereas similar grant funds were 
not available to SREs. The lack of Federal funding may largely explain 
the low number of SREs (27) and IRAPs (178) compared to the numbers 
anticipated in the 2020 IRAP final rule (203 SREs and 2,030 IRAPs in 
Year 1).
    While the estimated number of SRE applications in the 2020 IRAP 
final rule was based on the number of entities that submitted AAI grant 
applications, the estimated number of IRAPs was not based on a specific 
source of data because the IRAP system was a new concept in the United 
States. Accordingly, the Department does not have a guidepost to 
realistically estimate the number of IRAPs for an alternative baseline 
that assumes the absence of this rule and the removal of the February 
17, 2021, suspension.
    Without a reasonable way to estimate the number of SREs and IRAPs 
or to quantify the cost savings, benefits, and transfer payments, the 
Department acknowledges that this rule may have an annual effect on the 
economy of $100 million or more; therefore, this rule has been 
designated as an economically significant regulatory action under 
section 3(f) of E.O. 12866.
e. Nonquantifiable Effects
    The Department is rescinding the 2020 IRAP final rule and, instead, 
refocusing its efforts on expanding, modernizing, strengthening, and 
diversifying the Registered Apprenticeship system. As explained in the 
previous sections, the Registered Apprenticeship system is highly 
successful for industry. Industries that have adopted RAPs have cited 
the standards, skillsets, and retention offered by skilled workers 
associated with RAPs as advantageous to their bottom line. In one 
survey, nearly three-fourths of surveyed employers stated that RAPs 
drove increased worker productivity.\34\ A skilled workforce is 
foundational to a strong economy, and Registered Apprenticeship 
provides a proven avenue by which to deliver talent development to 
various industry sectors.
---------------------------------------------------------------------------

    \34\ Urban Institute Research Report, ``The Benefits and 
Challenges of Registered Apprenticeship: The Sponsors' 
Perspective,'' June 12, 2009, https://www.urban.org/research/publication/benefits-and-challenges-registered-apprenticeship-sponsors-perspective.
---------------------------------------------------------------------------

    In addition to the demonstrated success of RAPs as a workforce 
training model for industry, RAPs have proven to be highly beneficial 
to workers because of their emphasis on high-quality training as well 
as apprentice safety and welfare. During training, apprentices are 
guaranteed wage increases, and research shows that RAP completers earn 
over $300,000 (including benefits) more over their lifetimes as 
compared with similar individuals who do not complete a RAP.\35\
---------------------------------------------------------------------------

    \35\ See, e.g., Mathematica Policy Research, ``An Effectiveness 
Assessment and Cost-Benefit Analysis of Registered Apprenticeship in 
10 States: Final Report,'' July 25, 2012, https://wdr.doleta.gov/research/FullText_Documents/ETAOP_2012_10.pdf. This report 
categorizes reduced payments of unemployment insurance, welfare, and 
food stamps as benefits (separate from productivity increases) 
associated with Registered Apprenticeship; however, for purposes of 
this E.O. 12866 analysis, adding these effects would constitute 
double-counting and they should instead be presented as an 
assessment of who, other than workers themselves, receives some 
portion of productivity benefits. Moreover, as noted earlier in this 
regulatory preamble, the report does not speak to the relative 
effects of RAPs and IRAPs.
---------------------------------------------------------------------------

    The Registered Apprenticeship system has successfully been adopted 
across a diverse range of sectors, with significant growth in recent 
years. The expansion of the Registered Apprenticeship system into 
``nontraditional'' sectors indicates that the IRAP model may be 
superfluous and not a good use of Government resources that could 
support the proven activities of the Registered Apprenticeship system.
3. Regulatory Alternatives
    OMB Circular A-4 directs agencies to analyze alternatives if such 
alternatives best satisfy the philosophy and principles of E.O. 12866. 
Accordingly, the Department considered two regulatory alternatives. 
Under the first alternative, the Department would allow the SREs and 
any related IRAPs to operate with the Department's recognition for a 
transitional period not to exceed the previously approved 5-year 
period. As noted above, the approach of permitting the continued 
recognition of SREs and any related IRAPs would continue to temporarily 
retain a parallel system that does not ensure sufficient protections 
for apprentices, would diminish Departmental resources available for 
expansion of Registered Apprenticeship, and would generate confusion 
among both entities interested in establishing apprenticeship programs 
and the potential apprentices in such programs. This alternative would 
result in lower cost savings over the 10-year analysis period than the 
cost savings presented in Exhibit 1 because SREs and IRAPs would be 
obligated to follow the provisions of the 2020 IRAP final rule for a 
longer period of time. Therefore, the costs of the 2020 IRAP final rule 
would accumulate for a longer duration and the cost savings would be 
delayed.
    Under the second alternative, the Department would recast IRAPs as 
Certified Work-Based Learning. The Department considers the most 
effective and efficient use of its resources is to oversee a national 
system of Registered Apprenticeship that is more protective of the 
welfare of apprentices and that

[[Page 58286]]

has demonstrated its capacity to grow and adapt across a range of 
industries and sectors. Similarly, recasting IRAPs as a type of 
Certified Work-Based Learning would not address the concerns identified 
in the discussions above regarding an indirect and insufficient 
oversight role for the Department in IRAPs. This alternative would also 
result in lower cost savings over the 10-year analysis period than the 
cost savings presented in Exhibit 1 because SREs and IRAPs would incur 
costs under the revised program. The Department cannot estimate the 
costs without details about the provisions of such a program.

B. Regulatory Flexibility Act and Executive Order 13272 (Proper 
Consideration of Small Entities in Agency Rulemaking)

    In accordance with the Regulatory Flexibility Act, 5 U.S.C. ch. 6 
(as amended), the Department examined the regulatory requirements of 
this final rule to determine whether they will have a significant 
economic impact on a substantial number of small entities. As explained 
in the E.O. 12866 economic analysis above, this final rule is expected 
to lead to cost savings for IRAPs because these entities will no longer 
be required to comply with the provisions of the 2020 IRAP final rule. 
Cost savings for IRAPs will primarily arise from no longer needing to 
submit performance data to the SRE and no longer needing to prepare or 
sign a written apprenticeship agreement with each apprentice.
    In the 2020 IRAP final rule, the Department estimated that it would 
take IRAPs approximately 25 hours per year to collect and provide the 
relevant performance data. To estimate the cost savings per IRAP under 
this final rule, the Department multiplied the number of IRAPs (178) by 
25 hours and by the hourly compensation rate for Training and 
Development Managers ($123.22 per hour). In the 2020 IRAP final rule, 
the Department estimated that it would take IRAPs approximately 10 
minutes per apprentice to prepare and sign a written apprenticeship 
agreement. To estimate the cost savings per IRAP under this final rule, 
the Department multiplied the number of apprentices (23,975) by 10 
minutes and by the hourly compensation rate for Training and 
Development Managers ($123.22 per hour). In total, the first-year cost 
savings per IRAP is estimated at $5,516 at a discount rate of 7 
percent. The annualized cost savings per IRAP is estimated at $5,902 at 
a discount rate of 7 percent.
    As of September 30, 2021, the number of IRAPs recognized by SREs 
stood at 178. Of the 178 IRAPs, 167 are in the health care industry; 
specifically, the vast majority of the 167 IRAPs are associated with 
hospitals and medical centers. As shown in Exhibit 2, the first-year 
and annualized cost savings for IRAPs in the hospitals subsector are 
not expected to have a significant economic impact (3 percent or more) 
on small entities of any size.
[GRAPHIC] [TIFF OMITTED] TR26SE22.008

    Similarly, the final rule will result in cost savings for SREs. The 
cost savings will arise from SREs no longer needing to perform the 
activities listed in the E.O. 12866 economic analysis above: notifying 
the Administrator of any major change to processes or programs; 
informing the Administrator of IRAP recognition, suspension, or 
derecognition; provision of data or information to the Administrator; 
provision of written attestation to the Administrator; disclosure of 
the credentials that apprentices will earn; quality control of IRAPs; 
submission of performance data to the Administrator; making publicly 
available IRAP performance data; and recordkeeping. The first-year cost 
savings per SRE is estimated at $13,555 at a discount rate of 7 
percent. The annualized cost savings per SRE is estimated at $14,504 at 
a discount rate of 7 percent.
    The Department has recognized 27 SREs. Only 6 of the 27 SREs have 
recognized IRAPs, and of those 6 SREs, 1 has 99.2 percent of all 
apprentices in IRAPs (23,781 out of 23,975 apprentices). This 
particular SRE is unlikely to be considered a small entity based on its 
annual revenue,\36\ which exceeds the Small Business Administration's 
Small Business Size Standard of $20.5 million for professional 
organizations (North American Industry Classification System code 
813920).\37\
---------------------------------------------------------------------------

    \36\ IRS Form 990 filing data available from the Internal 
Revenue Service, ``Tax Exempt Organization Search,'' https://apps.irs.gov/app/eos (last visited May 19, 2022).
    \37\ U.S. Small Business Administration, ``Table of Small 
Business Size Standards,'' https://www.sba.gov/document/support-table-size-standards (last updated May 2, 2022).

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

[[Page 58287]]

    Accordingly, the Department certifies that this final rule will not 
have a significant economic impact on a substantial number of small 
entities. Moreover, any economic impact experienced by IRAPs or SREs 
will be cost savings.

C. Paperwork Reduction Act

    As explained in the ``Background'' section above, the Department is 
rescinding subpart B, ``Standards Recognition Entities of Industry-
Recognized Apprenticeship Programs,'' from 29 CFR part 29, the 
regulatory framework for the Department's recognition of SREs and SREs' 
role in recognizing IRAPs.
    As part of the implementation and rollout of the 2020 IRAP final 
rule, the Department developed and received OMB approval for two 
information collections (ICs), an application form and a performance 
report. The first active IC is entitled ``Industry-Recognized 
Apprenticeship Program Standards Recognition Entity Regulation and 
Application'' (OMB Control Number 1205-0536) and includes an annual 
approved burden of 141,819 responses and 285,310 hours. The second 
active IC is entitled ``IRAP Program and Performance Report for 
Standards Recognition Entities'' (OMB Control Number 1205-0545) and 
includes an annual approved burden of 12,447 responses and 111,118 
hours. This rule does not result in any additional cost burden for 
either IC.
    Because this final rule rescinds subpart B, which is the authority 
for these information collections, the Department will no longer use 
the ``Industry-Recognized Apprenticeship Program Standards Recognition 
Entity Regulation and Application'' IC and the ``IRAP Program and 
Performance Report for Standards Recognition Entities'' IC.
    The Department has submitted requests to discontinue both OMB 
Control Number 1205-0536 and OMB Control Number 1205-0545, eliminating 
all paperwork burden associated with the ICs. These ICs will 
discontinue upon the effective date of this final rule.

D. Executive Order 13132: Federalism

    This final rule does not have federalism implications because it 
does not have substantial direct effects on the States, on the 
relationship between the National Government and the States, or on the 
distribution of power and responsibilities among the various levels of 
Government. Accordingly, E.O. 13132, Federalism, requires no further 
agency action or analysis.

E. Unfunded Mandates Reform Act of 1995

    Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), 2 
U.S.C. 1532, requires each Federal agency to prepare a written 
statement assessing the effects of any Federal mandate in a proposed 
agency rule that may result in $100 million or more in expenditures 
(adjusted annually for inflation) in any one year by State, local, and 
tribal Governments, in the aggregate, or by the private sector.
    This final rule does not exceed the $100-million expenditure in any 
one year when adjusted for inflation, and this rulemaking does not 
contain such a mandate. The requirements of title II of UMRA, 
therefore, do not apply, and the Department has not prepared a 
statement under the Act.

F. Executive Order 13175 (Indian Tribal Governments)

    The Department has reviewed this final rule in accordance with E.O. 
13175 and has determined that it does not have tribal implications. The 
final rule does not have substantial direct effects on one or more 
Indian tribes, on the relationship between the Federal Government and 
Indian tribes, or on the distribution of power and responsibilities 
between the Federal Government and Indian tribes.

List of Subjects in 29 CFR Part 29

    Apprenticeability criteria, Apprentice agreements and complaints, 
Apprenticeship programs, Program standards, Registration and 
deregistration, Sponsor eligibility, State Apprenticeship Agency 
recognition and derecognition.

    For the reasons stated in the preamble, the Department amends 29 
CFR part 29 as follows:

PART 29--LABOR STANDARDS FOR THE REGISTRATION OF APPRENTICESHIP 
PROGRAMS

0
1. The authority citation for part 29 is revised to read as follows:

    Authority: 29 U.S.C. 50; 40 U.S.C. 3145; 5 U.S.C. 301; 5 U.S.C. 
App. P. 534.


0
2. Remove the subpart A heading.

0
3. Amend Sec.  29.1 by:
0
a. Revising the section heading; and
0
b. In paragraph (b), removing the word ``subpart'' and adding the word 
``part'' in its place.
    The revision reads as follows:


Sec.  29.1  Purpose and scope.

* * * * *


Sec.  29.2  [Amended]

0
4. Amend Sec.  29.2 by:
0
a. In the introductory text, removing the word ``subpart'' and adding 
the word ``part'' in its place;
0
b. In the definitions of ``Apprenticeship program'' and ``Registration 
agency'', removing the citation ``29 CFR part 29 subpart A, and part 
30'' and adding the citation ``this part and 29 CFR part 30'' in its 
place; and
0
c. In the definition of ``Technical assistance'', removing the word 
``subpart'' and adding the word ``part'' in its place.


Sec.  29.3  [Amended]

0
5. In Sec.  29.3 amend paragraphs (b)(1), (g) introductory text, and 
(h) by removing word ``subpart'' and add in its place the word 
``part''.


Sec.  29.6  [Amended]

0
6. In Sec.  29.6 amend paragraph (b)(2) by removing word ``subpart'' 
and add in its place the word ``part''.


Sec.  29.10  [Amended]

0
7. In Sec.  29.10 amend paragraph (a)(2) by removing word ``subpart'' 
and add in its place the word ``part''.


Sec.  29.11  [Amended]

0
8. In Sec.  29.11 amend the introductory text removing word ``subpart'' 
and add in its place the word ``part''.


Sec.  29.13  [Amended]

0
9. Amend Sec.  29.13 by:
0
a. In paragraph (a)(1), removing the citation ``29 CFR part 29 subpart 
A, and part 30'' and adding the citation ``this part and 29 CFR part 
30'' in its place;
0
b. In paragraph (b)(1), removing the citation ``29 CFR part 29 subpart 
A'' and adding ``this part'' in its place;
0
c. In paragraphs (c) and (e) introductory text, removing the word 
``subpart'' and adding the word ``part'' in its place; and
0
d. In paragraph (e)(4), removing the citation ``part 29 subpart A'' and 
adding ``this part'' in its place.


Sec.  29.14  [Amended]

0
10. Amend Sec.  29.14 by:
0
a. In the introductory text, removing the citation ``part 29 subpart A, 
and part 30'' and adding the citation ``this part and 29 CFR part 30'' 
in its place; and
0
b. In paragraphs (e)(1) and (i), removing the word ``subpart'' and 
adding the word ``part'' in its place.

[[Page 58288]]

Subpart B--[Removed]

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11. Remove subpart B, consisting of Sec. Sec.  29.20 through 29.31.

Brent Parton,
Acting Assistant Secretary for Employment and Training, Labor.
[FR Doc. 2022-20560 Filed 9-23-22; 8:45 am]
BILLING CODE 4510-FR-P