Trade Adjustment Assistance for Workers, Workforce Investment Act; Amendment of Regulations, 50760-50832 [06-7067]

Agencies

• Employment and Training Administration
• DEPARTMENT OF LABOR

[Federal Register Volume 71, Number 165 (Friday, August 25, 2006)]
[Proposed Rules]
[Pages 50760-50832]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 06-7067]



[[Page 50759]]

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Part IV





Department of Labor





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Employment and Training Administration



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20 CFR Parts 617, 618, 665, and 671



Trade Adjustment Assistance for Workers, Workforce Investment Act; 
Amendment of Regulations; Proposed Rule

Federal Register / Vol. 71, No. 165 / Friday, August 25, 2006 / 
Proposed Rules

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DEPARTMENT OF LABOR

Employment and Training Administration

20 CFR Parts 617, 618, 665, 671

RIN 1205-AB32


Trade Adjustment Assistance for Workers, Workforce Investment 
Act; Amendment of Regulations

AGENCY: Employment and Training Administration, Labor.

ACTION: Notice of Proposed Rule Making (NPRM).

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SUMMARY: On August 6, 2002, President Bush signed into law the Trade 
Adjustment Assistance Reform Act of 2002 (the Reform Act), which 
amended the Trade Act of 1974, as amended (Act or Trade Act). The 
Reform Act reauthorized the Trade Adjustment Assistance (TAA) program 
through fiscal year 2007 and made significant amendments to the TAA 
program, which generally took effect on November 4, 2002. The 
Employment and Training Administration (ETA) of the United States 
Department of Labor (Department or DOL) is publishing this proposed 
rule to implement the amended TAA program.

DATES: The Department invites written comments on this proposal. 
Comments must be submitted by October 24, 2006.

ADDRESSES: You may submit written comments, identified by the proposed 
rule's Regulatory Identification Number (RIN) 1205-AB32, on the 
proposed rules by any of the following methods:
     Federal eRulemaking Portal: https://www.regulations.gov. 
Follow the instructions for submitting comments.
     E-mail: regulations.TAA@dol.gov. Include RIN 1205-AB32 in 
the subject line of the message. Your comment must be in the body of 
the e-mail message; do not send attached files.
     Fax: (202) 693-3584 (this is not a toll-free number). Only 
comments of ten or fewer pages (including a Fax cover sheet and 
attachments, if any) will be accepted by Fax.
     Mail: Submit comments (preferably with three copies) to 
Erica Cantor, Director, Division of Trade Adjustment Assistance, ETA, 
U.S. Department of Labor, Room C-5311, 200 Constitution Avenue, NW., 
Washington, DC 20210. Because of security-related concerns, there may 
be a significant delay in the receipt of submissions by United States 
Mail. You must take this into consideration when preparing to meet the 
deadline for submitting comments.
    Instructions: All submissions received must include the agency name 
and the RIN for this rulemaking: RIN 1205-AB32. If commenters transmit 
comments by Fax or through the Internet and also submit a hard copy by 
mail, please indicate that it is a duplicate copy of the Fax or 
Internet transmission.
    All comments will be available for public inspection and copying 
during normal business hours at the Division of Trade Adjustment 
Assistance, ETA, U.S. Department of Labor, 200 Constitution Avenue, 
NW., Room C-5311, Washington, DC 20210. Copies of the proposed rule are 
available in alternative formats of large print and electronic file on 
computer disk, which may be obtained at the above-stated address. The 
proposed rule is available on the Internet at the Web address https://
www.doleta.gov.

FOR FURTHER INFORMATION CONTACT: Erica Cantor, Director, Division of 
Trade Adjustment Assistance, ETA, U.S. Department of Labor, 200 
Constitution Avenue, NW., Room C-5311, Washington, DC 20210. Telephone: 
(202) 693-3560 (voice) (this is not a toll-free number); 1-800-326-2577 
(TDD); facsimile: (202) 693-3584; e-mail: regulations.TAA@dol.gov.

SUPPLEMENTARY INFORMATION: The Reform Act expanded the scope of the TAA 
program and increased benefit amounts available under that program, 
repealed the North American Free Trade Agreement Transitional 
Adjustment Assistance (NAFTA-TAA) program, provided a health coverage 
tax credit (HCTC) administered by the Internal Revenue Service (IRS) to 
subsidize private health insurance costs for qualified workers, and 
enacted a pilot program for Alternative Trade Adjustment Assistance for 
older workers (ATAA). These amendments were designed to augment and 
improve the delivery of benefits and services to certain workers 
adversely affected by foreign trade.
    To incorporate into regulations the substantial changes to the TAA 
program, including the introduction of ATAA, the Department proposes 
creating a new 20 CFR Part 618. The proposed Part 618 consists of nine 
subparts: subpart A--General; subpart B--Petitions and Determinations 
of Eligibility to Apply for Trade Adjustment Assistance [Reserved]; 
subpart C--Delivery of Services through the One-Stop Delivery System; 
subpart D--Job Search Allowances; subpart E-Relocation Allowances; 
subpart F--Training Services; subpart G--Trade Readjustment Allowances 
(TRA); subpart H--Administration by Applicable State Agencies; and 
subpart I--Alternative Trade Adjustment Assistance for Older Workers 
[Reserved]. Because of the complexity of the subject matter and the 
States' need for definitive instructions on providing TAA benefits, the 
rulemaking for Part 618 is divided into three parts. This Notice of 
Proposed Rulemaking covers the general provisions (subpart A) and TAA 
benefits portions (subpart C through subpart H) of the regulations. 
Separate notices of proposed rulemaking (RIN 1205-AB40 covering subpart 
I and RIN 1205-AB44 covering Subpart B) will be published at a later 
date.
    Consistent with the Reform Act, the Department proposes that the 
TAA regulations codified at 20 CFR Part 617 be amended to apply only to 
adversely affected workers whose certifications of eligibility to apply 
for TAA are based on petitions filed before the effective date of the 
amendments, whether the certifications were issued before or after that 
date. However, eligible workers covered by Part 617 will be able to use 
the HCTC, and the Department proposes to amend Part 617 to require the 
States to advise adversely affected workers covered by that Part of the 
qualifying requirements for the HCTC and related health insurance 
assistance. The Department also proposes revising the regulations 
governing Statewide Workforce Investment Activities, and National 
Emergency Grants, 20 CFR Parts 665 and 671, respectively. These 
revisions will incorporate into the Workforce Investment Act of 1998 
(WIA) regulations the new statutory requirement that States provide 
rapid response assistance to workers as soon as they have filed 
petitions, or petitions have been filed on their behalf, for 
certification of eligibility to apply for TAA. A new section will be 
added to Part 671 to incorporate the new statutory authority for the 
use of funds made available under WIA to make grants to provide health 
insurance coverage assistance to certain adversely affected workers 
under the Trade Act and others.
    This preamble is divided into five sections. Section I provides 
general background information on the TAA program. Section II describes 
the changes that the Reform Act made to the TAA program. Section III 
discusses the Department's guiding principles for implementing reform 
of the TAA program through the proposed rule. Section IV discusses the 
proposed rule. Section V discusses administrative requirements for this 
proposed rulemaking, as mandated by statute and executive order.

[[Page 50761]]

I. Background

    The Reform Act amended chapter 2 of title II of the Trade Act of 
1974 (Pub. L. 93-618), as amended. The TAA program, established by the 
Act in 1974 to provide improved assistance for workers injured or 
threatened with injury from increased imports, was changed extensively 
by amendments in 1981 (title XXV of Pub. L. 97-35), 1984 (sections 2671 
and 2672 of Pub. L. 98-369), 1986 (Part 1 of subtitle A of title XIII 
of Pub. L. 99-272), 1988 (Part 3 of subtitle D of title I of Pub. L. 
100-418), and 1993 (section 506 of Pub. L. 103-182).
    Before the TAA program's most recent amendment in August 2002, the 
Department conducted a fact-finding investigation in response to its 
receipt of a petition for TAA from a group of workers (or their 
representative). If the investigation resulted in the finding that a 
group of workers of a firm (or subdivision) had been adversely affected 
by import competition, then an ETA certifying officer issued a 
certification stating that workers in the identified worker group were 
eligible to apply for TAA benefits with the Cooperating State Agency 
(CSA).
    Then, as now, State agencies administered the TAA program as agents 
of the federal government through agreements signed by the Secretary 
and Governors of the States. State agencies notified certified workers 
of potential TAA benefits and services, made eligibility determinations 
for individuals, and delivered benefits and services. Individual 
workers who were members of the certified worker group applied for 
benefits and services at a local office of the State's One-Stop 
delivery system.
    Individual workers who met the qualifying criteria could receive up 
to 104 weeks of job training, generally up to 52 weeks of income 
support in the form of Trade Readjustment Allowances (TRA), job search 
allowances, and relocation allowances. In addition, all workers covered 
by a certification were eligible for basic reemployment services, 
including assistance in writing resumes, job referrals, and 
participation in job clubs.
    On December 8, 1993, the President signed into law the NAFTA 
Implementation Act of 1993, which created the NAFTA-TAA program 
(section 250 of subchapter D of chapter 2 of title II of the 1974 Act). 
Certifications of worker groups under the NAFTA-TAA program were made 
only if imports from Canada and/or Mexico caused the import impact, or 
if the workers' firm shifted production of an article to either Canada 
or Mexico. Workers (or their representatives) filed petitions with the 
Governor of the State in which they were employed, not directly with 
the Department. The State performed a preliminary investigation upon 
receipt of a NAFTA-TAA petition. If the workers appeared to be impacted 
by imports from Canada or Mexico or a shift of production to Canada or 
Mexico and the firm's (or subdivision's) sales or production decreased 
absolutely, then the State undertook rapid response activities under 
WIA. The State transmitted all information gathered in its preliminary 
investigation to DOL, which issued the final determination on whether 
to certify the group of workers as eligible to apply for NAFTA-TAA 
benefits. In order to qualify for TRA, a worker certified under the 
NAFTA-TAA program had to be enrolled in approved training within 
specific time limits; no waivers from this requirement were allowed. 
However, the TAA program allowed waivers of ``basic'' TRA (i.e., the 
first 26 weeks of TRA) if training was ``not feasible or appropriate'' 
for the worker.
    As part of its passage of the NAFTA Implementation Act, Congress 
approved the Administration's Statement of Administrative Action (SAA). 
NAFTA, H.R. Doc. No. 103-159, vol. 1, at 10 (1993). The SAA committed 
the Department to provide assistance under the Job Training Partnership 
Act (and, after the repeal of that act, under WIA) to ``secondary'' 
workers who lost their jobs as a result of the loss of business with a 
primary firm that was directly affected by imports, but who were not 
directly impacted by trade with Canada or Mexico. See id. at 450 
(1993). Workers would receive assistance if their firm supplied 
components to, or performed finishing operations for, a firm that was 
directly impacted by trade with Canada or Mexico. These ``secondary 
workers'' either filed a petition for certification under both the TAA 
program and the NAFTA-TAA program or filed a petition just under the 
NAFTA-TAA program. The Department initiated an investigation into their 
eligibility under the SAA if their certification was denied following 
the investigation of a NAFTA-TAA petition. The Department determined 
whether the worker group was impacted indirectly or ``secondarily'' by 
imports from Canada and/or Mexico or a shift of production to Canada or 
Mexico. If the Department made an affirmative determination, then 
workers in the group were eligible to apply for benefits and services 
delivered through the dislocated worker program, even though they did 
not qualify for assistance under the NAFTA-TAA program.

II. How the Reform Act Changed the TAA Program

    The TAA program has been a required partner in the workforce 
investment system since the enactment of WIA in 1998. The Reform Act 
expressly directed the Secretary and the States to coordinate the TAA 
program with the workforce investment system created under WIA to help 
adversely affected workers return to the workforce as quickly as 
possible.
    The Reform Act expanded the coverage of the TAA program and 
increased the benefits provided to adversely affected workers, in part 
by consolidating the TAA program and the NAFTA-TAA program. As a 
result, there is a uniform set of requirements that replaces the often 
different and confusing sets of rules and procedures that applied to 
the two programs when they were separate. Before the enactment of the 
Reform Act, only workers whose firms (or subdivisions) were directly 
affected by increased imports could be certified as eligible to apply 
for TAA. Eligibility requirements for the NAFTA-TAA program were more 
inclusive. Workers whose firms (or subdivision) were directly affected 
by either increased imports from or a shift in production to Mexico or 
Canada of an article that is like or directly competitive with the 
article their firm (or subdivision) produced could be certified as 
eligible to apply for NAFTA-TAA benefits. The Reform Act expanded 
eligibility even further by retaining the TAA program's eligibility for 
workers who were directly affected by increased imports from any 
country and adding provisions to include workers who lose their jobs 
when their firms (or subdivisions) shifted production to: a country 
that is a party to a free trade agreement with the United States (such 
as, but not limited to, NAFTA); a country that is a beneficiary under 
certain specified legislation enacted by Congress involving trade 
relations; or to any other foreign country when there has been or there 
is likely to be an increase in imports of articles that are like or 
directly competitive with the articles produced by their firm (or 
subdivision).
    In addition, the Reform Act expanded TAA program eligibility to 
include two categories of secondary workers in the stream of commerce: 
those who perform work upstream in the production of a trade-impacted 
article and those who perform work downstream in that production. The 
first category covers workers who perform activities for a

[[Page 50762]]

firm (or subdivision of a firm) that supplies component parts for the 
article produced by a ``primary firm'' (i.e., a firm that employed a 
certified group of workers). The Act requires that, if a significant 
number or proportion of such secondary workers have been separated (or 
threatened with separation), then they will be certified as eligible to 
apply for TAA if either the component parts sold to the primary firm 
constituted at least 20 percent of the sales of the supplier, or the 
loss of business with the primary firm contributed importantly to the 
loss of jobs at the supplying firm.
    The second category of secondary workers includes workers employed 
by ``downstream producers,'' defined as firms (or subdivisions) 
providing additional, value-added production processes, such as 
finishers or final assemblers of articles produced by a primary firm. 
These workers will be certified as eligible to apply for TAA when: 
workers of the primary firm were TAA-certified due to increased imports 
from or shifts in production to Mexico or Canada of the articles that 
were the basis for the TAA certification; a significant number or 
proportion of the workers in the secondary workers' firm (or applicable 
subdivision) were separated or threatened with separation; and the 
secondary workers' firm's (or subdivision's) loss of business from the 
primary firm (or appropriate subdivision) contributed importantly to 
their separation (or threatened separation). Both the upstream 
``supplier'' and the ``downstream producer'' categories of secondary 
workers, although not covered by the NAFTA-TAA program, may have been 
eligible under the SAA to receive adjustment assistance initially 
through the Job Training Partnership Act and later through WIA.
    The Reform Act made a number of changes in administrative 
requirements under the TAA program. One-Stop operators, One-Stop 
partners, including certain State agencies as well as employers of 
workers, are specifically added to the categories of entities who may 
file a petition, though previously these entities could have filed 
petitions only if they were duly authorized representatives of a group 
of workers. To inform workers more quickly of the availability of 
assistance and to facilitate reemployment, rapid response assistance 
under WIA is now triggered by the concurrent submission of a petition 
to the Governor and the Secretary. The Department must now make a 
determination on whether a petition for certification meets the 
approval criteria within 40 days instead of 60 days from the date of 
filing of the petition.
    To promote adjustment and accelerate reemployment, the Reform Act 
provides that eligibility for TRA, which is additional income support 
after unemployment insurance (UI) is exhausted, will be contingent on a 
worker's enrollment in training not later than 16 weeks after 
separation from employment or 8 weeks after the petition for 
eligibility has been approved, whichever date is later. In extenuating 
circumstances, these deadlines for enrollment in training may be 
extended up to 45 days; and a waiver of the enrollment in training 
requirement to receive basic TRA may be issued only under limited and 
specified conditions. The Reform Act also increased the length of time 
that TRA is available to an adversely affected worker who is in 
training by increasing the availability of ``additional'' TRA from 26 
to 52 weeks and by further adding up to 26 additional weeks of TRA if a 
worker is enrolled in a course of remedial education. The primary 
purpose of this extended income support is to minimize workers' 
financial hardship until they complete training. By requiring that 
workers expeditiously enroll in training as a condition of receiving 
TRA, the Reform Act amendments provide that workers will be more likely 
to complete the training within the duration of that income support.
    The Reform Act also established ATAA, a pilot program designed to 
encourage the rapid reemployment of workers aged 50 or older. 
Petitioners seeking ATAA certification for a group of workers on whose 
behalf TAA certification is sought should make their request on the TAA 
petition form they submit to the Department. In determining whether to 
certify a group of workers as eligible to apply for ATAA, the following 
criteria must be considered: (1) Whether a significant number of 
workers in the workers' firm are 50 years of age or older; (2) whether 
the workers in the workers' firm possess skills that are not easily 
transferable; and (3) the competitive conditions within the workers' 
industry.
    A qualified worker in a group certified as eligible to apply for 
ATAA may choose to receive payments of 50 percent of the difference 
between their pre-layoff wages and their reemployment wages in lieu of 
all other benefits available under the TAA program except the HCTC. A 
worker may receive payments for up to a two-year period, but the 
maximum amount paid may not exceed $10,000. In order to qualify, a 
worker must be at least 50 years of age, become reemployed within 26 
weeks of separation, and be reemployed at annual wages of less than 
$50,000 in a full-time job that is not the job from which he or she was 
laid off. The termination date for ATAA is August 6, 2008, five years 
after the date of its implementation. However, participants may 
continue to receive the balance of the payments for which they were 
eligible after the termination date.
    The Reform Act amended the Internal Revenue Code (IRC) to authorize 
the HCTC for certain eligible individuals in the new and old TAA 
programs and in the NAFTA-TAA program. The Reform Act added a new 
section 35 to the IRC, establishing the HCTC which is a tax credit 
covering 65 percent of the cost paid by the individual for coverage of 
the individual and the individual's qualified family members under 
qualified health insurance. Potentially eligible individuals fall into 
three groups: (1) ``eligible TAA recipients,'' meaning individuals who 
are receiving TRA or who would be eligible to receive TRA if they had 
exhausted their UI; (2) ``eligible alternative TAA recipients,'' 
meaning individuals who are receiving a benefit under the ATAA program; 
and (3) ``eligible PBGC pension recipients,'' meaning individuals who 
are at least age 55 and receiving pension benefits paid, at least in 
part, by the Pension Benefit Guaranty Corporation (PBGC). The credit 
has been available on an advance basis since August 1, 2003. With 
respect to advance payments of the credit, the Reform Act requires the 
Secretary of Labor to certify an individual as an eligible TAA 
recipient, eligible ATAA recipient, or eligible PBGC pension recipient 
to enable potentially eligible recipients to seek the credit from the 
IRS. The IRS then determines whether the other HCTC eligibility 
criteria have been met. The Department is coordinating administration 
of this responsibility and other aspects of the HCTC with the 
Department of the Treasury, the Department of Health and Human 
Services, the PBGC, and the CSAs administering the TAA program.
    The Reform Act also added two new aspects to the National Emergency 
Grant (NEG) program administered by the DOL under WIA to assist the 
States in providing health insurance coverage assistance to eligible 
individuals. One type of NEG is available primarily to provide health 
insurance coverage assistance to eligible individuals and to pay the 
administrative and startup costs of enrolling such individuals, which 
includes the processing of the eligibility certificates necessary for 
the tax credit. The other type of NEG is available

[[Page 50763]]

primarily to provide interim health insurance coverage assistance and 
supportive services (such as transportation, child and dependent care, 
and income assistance) to individuals eligible for the tax credit, 
including eligible TAA recipients under the old TAA and NAFTA-TAA 
programs.
    The Reform Act also amended the Employee Retirement Income Security 
Act, the Public Health Service Act, and the IRC to allow a temporary 
60-day extension of the period during which individuals who are ``TAA-
eligible recipients'' may elect Consolidated Omnibus Budget 
Reconciliation Act (COBRA) continuation coverage under the layoff 
employer's health insurance plan. The temporary extension provided 
under the Reform Act begins on the day the individual first meets the 
TAA eligibility requirements. The TAA-eligible worker must elect to 
receive the temporary extension within six months after the date of the 
TAA-related loss of coverage, which the statute defines as the loss of 
health benefits coverage associated with the separation of the TAA-
eligible individual from employment. If a worker elects to receive the 
extension, then either the tax credit or the NEG would be available to 
assist the worker to make the payments for the continuation coverage.
    Aspects of the tax credit that are administered by the Internal 
Revenue Service and the Department of the Treasury are not addressed in 
the proposed regulations. However, the Department proposes amendments 
to WIA regulations at 20 CFR Part 671 to reflect the new tax credit-
related changes to the NEG programs. Funds made available to States 
under WIA section 174 will be used to provide health insurance coverage 
assistance to eligible TAA recipients, eligible ATAA recipients and 
eligible PBGC pension recipients under WIA section 173(f) and (g).
    The Reform Act also created a separate TAA for Farmers program. 
Eligibility determinations for that program are the responsibility of 
the Secretary of Agriculture. Agricultural commodity producers entitled 
to cash benefits under that program are entitled to the same basic 
reemployment services and training as other workers covered by the TAA 
program, but they may not receive TRA, job search or relocation 
allowances, or the HCTC. The Department of Labor provides funding for 
the employment services and the Secretary of Agriculture oversees the 
payment of cash assistance (up to $10,000 per year) provided to 
eligible agricultural commodity producers under the Department of 
Agriculture's certification. The Secretary of Agriculture issued 
regulations implementing the Department of Agriculture's function in 
the TAA for Farmers program on August 20, 2003 (68 FR 50048) and 
November 1, 2004 (69 FR 63317-01).

III. Guiding Principles for the TAA Program Under Proposed 20 CFR Part 
618

    The Secretary seeks to ensure that States use effective strategies 
to assist adversely affected workers in rapidly obtaining sustainable 
employment through the operation of the TAA program and the 
demonstration ATAA program for older workers. State agencies must 
increase their focus on early intervention, upfront assessment and 
reemployment services for adversely affected workers. The initiation of 
rapid response activities upon the filing of a petition for 
certification of eligibility to apply for TAA allows State agencies the 
opportunity to provide workers with early assessment and identification 
of their marketable skills. A CSA's first priority should be to provide 
job search assistance and other reemployment services to improve the 
likelihood of these workers obtaining sustainable employment quickly. 
Where training is appropriate, it should be designed to return the 
worker to employment as quickly as is consistent with the worker's 
training goals.
    Career centers in the One-Stop delivery system will become the main 
point of participant intake and delivery of benefits and services by 
the States. This approach encourages coordination among workforce 
investment and other One-Stop partner programs including the TAA 
program, which will better serve workers and promote efficiencies in 
the workforce investment system.
    Fiscal integrity and performance accountability will be monitored 
to ensure that the money allocated for TAA and ATAA is used to assist 
workers and thereby strengthen the economy. Improved participant 
outcome measures for the program will assist the Department and the 
States in reaching these goals.

IV. Summary and Discussion of Regulatory Provisions

    The rules proposed in this NPRM, covering TAA program benefits and 
administration, are based largely on the current regulations codified 
at 20 CFR Part 617 (Trade Adjustment Assistance for Workers under the 
Trade Act of 1974). The proposed Part 618 regulations also incorporate 
amendments to the TAA program effectuated by the Reform Act, and 
simplify the language adopted from the current regulations in 
compliance with the Presidential directive that Federal agencies write 
new regulations in plain language (63 FR 31885, June 10, 1998). In 
accordance with the Reform Act, the claims of workers covered by 
petitions filed before November 4, 2002 continue to be governed by the 
rules of the TAA and NAFTA-TAA programs prior to that date. These rules 
will continue to be codified at 20 CFR Part 617. In addition, the 
NAFTA-TAA operating instructions previously issued by DOL, General 
Administrative Letter No. 7-94 (59 FR 3871, January 27, 1994) and 
changes 1, 2, and 3 (69 FR 60898, October 13, 2004; 69 FR 67963-03, 
November 22, 2004) will continue to apply to eligible participants of 
the TAA and NAFTA-TAA programs until superseded by these regulations.
    The proposed amendments to 20 CFR Part 617 and to the WIA 
regulations, codified at 20 CFR Parts 665 and 671, respectively, 
reflect both the Reform Act requirements for coordination between the 
workforce investment system and the TAA program and changes to the NEG 
program relating to the HCTC.

Part 617--Trade Adjustment Assistance Under the Trade Act of 1974 for 
Workers Certified Under Petitions Filed Before November 4, 2002

    The proposed revisions to Part 617 include changing the title to 
clearly identify that this Part applies only to workers certified as 
eligible to apply for trade adjustment assistance under petitions filed 
before the Reform Act changed the TAA program. Proposed Sec.  617.1 
amends this section to provide further clarification that the 
provisions for TAA assistance under this Part 617 will continue to 
apply after the effective date of Part 618 only to adjustment 
assistance, TRA, and other allowances available to adversely affected 
workers covered by certifications issued under petitions filed with the 
Secretary before November 4, 2002, the effective date of the Reform Act 
amendments to the TAA programs. Proposed Sec.  617.10 adds a new 
paragraph (e) to that section to require CSAs to advise adversely 
affected workers subject to the requirements of the TAA program in 
effect before November 4, 2002 of the qualifying requirements for the 
health coverage tax credit (HCTC) and related health insurance 
assistance established by the Reform Act.

[[Page 50764]]

Part 618--Trade Adjustment Assistance Under the Trade Act of 1974 for 
Workers Certified Under Petitions Filed After November 3, 2002.

Subpart A--General
    Subpart A describes the TAA program and the contents of all the 
subparts. In addition, it defines all relevant terms used in other 
subparts. (Several definitions related to subpart B (Petitions and 
Determinations of Eligibility to Apply for Trade Adjustment Assistance) 
are held in reserve for publication with subpart B.) Several 
definitions have been modified and simplified to clarify their 
meanings, or eliminated in response to statutory changes in the TAA 
program. In addition, definitions of new terms have been added to 
describe the amended TAA programs, including the new ATAA program. Use 
of these definitions in the NPRM is intended to facilitate the 
integration of the TAA programs into the One-Stop system under the WIA 
and to describe and implement new concepts introduced into the TAA 
programs by the Reform Act, such as the HCTC. Major changes include:
     The goal of the program has been defined as providing 
workers, so as quickly as possible, with assistance to return them to 
work that will use the highest skill levels and pay the highest wages 
given the workers' preexisting skill levels and education and the 
condition of the labor market.
     The definition of adversely affected worker has been 
clarified to include the owner of a small business adversely affected 
by foreign trade.
     A new definition of customized training has been added.
     Definitions necessary for HCTC processing have been added.
    Proposed Sec.  618.100 describes the purpose of the program, which 
the Department, based on past experience, has modified to reflect 
achievable outcomes for a worker. Under the current statement of 
purpose at 20 CFR 617.2, the stated goal of the TAA program is to 
return workers to suitable employment as quickly as possible. In this 
context, ``suitable employment'' means that after the worker received 
services under the TAA program, the worker would be re-employed at 80 
percent of his or her former salary. While that goal has not changed, 
the Department has revised the wording of the goal to make it clear 
that finding ``suitable employment'' is a goal, not a requirement of 
the Act.
    Although the ``suitable employment'' standard is a worthy goal, and 
one that the Department intends to continue to pursue, it is merely a 
goal and not a program requirement. Unfortunately, there are situations 
in which workers may be unable to obtain ``suitable employment'' either 
in the local labor market or as a result of training. This may occur 
because the workers are experienced workers for whom few jobs at their 
former wages are available, because of a depressed local labor market 
in which there are few available jobs, or because the workers have 
substantial barriers to reemployment. These factors significantly 
constrain the training opportunities that are available for these 
workers, and therefore, their employment prospects as well. Yet 
providing training, especially in a stagnant labor market, may 
significantly increase a worker's chances for obtaining a decent job 
with career advancement prospects or of succeeding in the labor market.
    The Department's goal is to provide the best possible outcome for 
each worker participating in the program. Therefore, the Department is 
committed to providing training that will allow a worker to compete for 
the highest paying employment achievable given the worker's pre-
existing skills, abilities, and education, and the current job market. 
The proposed purpose section accurately reflects the Department's goal.
    Proposed Sec.  618.105 sets forth the effective dates for various 
aspects of the TAA program, the ATAA program, and HCTC, as provided by 
the Reform Act. Until these regulations at Part 618 take effect, 
Training and Employment Guidance Letter (TEGL) No. 11-02 and its 
changes will continue to govern determinations on certifications and 
benefits for workers covered under petitions filed after November 3, 
2002. Similarly, TEGL No. 2-03, and its changes, continue to govern 
determinations on ATAA certifications and benefits made before the 
effective date of this Part 618. Part 617 will continue to apply to the 
operational and benefit provisions of the TAA program for petitions 
filed before November 4, 2002 and certifications granted under those 
petitions. General Administrative Letter (GAL) No. 7-94 (59 FR 3871, 
January 27, 1994) and its changes (69 FR 60898-60903, October 13, 2004) 
continue to apply to NAFTA-TAA petitions filed before November 4, 2002, 
even when determinations on those petitions are issued after that date.
    The terms defined in proposed Sec.  618.110 apply to both the 
petition process and the benefit provisions of the TAA program. They 
derive from six basic sources: the Act prior to the Reform Act 
amendments, the Reform Act, 20 CFR Part 617, 29 CFR Part 90, the WIA 
and its implementing regulations at 29 CFR Part 652, et seq. Several 
definitions used in 20 CFR Part 617 and 29 CFR Part 90 have been 
modified and simplified to clarify their meanings, amended to reflect 
current TAA statutory language or eliminated in response to TAA 
statutory changes.
    The particular definitions are explained as they appear in this 
section, in alphabetical order, as follows.
    Act--The citation for the Trade Act in the proposed definition is 
updated from the citations in 29 CFR Part 90 and 20 CFR 617.3(a) to 
include all amendments to the Act through the date of publication of 
this notice.
    Additional compensation--This proposed term was included in the 
description of unemployment compensation in 20 CFR 617.3(oo). The 
proposed definition of this term is the same as Sec.  617.3(oo)(2).
    Adversely affected employment--This proposed definition is based on 
the statutory definition, which was codified in 20 CFR 617.3(a), and, 
although the definition has been revised for clarity, no substantive 
change from that definition is intended.
    Adversely affected worker--This proposed definition modifies the 
definition in 20 CFR 617.3(c) to clarify the Department's 
interpretation of this statutory term. Under this proposed definition, 
an employer may be considered an adversely affected worker when the 
employer is also an employee of a business that closes or experiences a 
reduction in operation. In this circumstance, if the employer becomes 
totally or partially separated from his or her employment, the employer 
is an ``adversely affected worker.'' The proposed definition also 
changes the definition in 20 CFR 617.3(c) to include the applicable 
periods during which the worker's separation must occur in order for 
that worker to be eligible to apply for TAA, or TAA and ATAA: the 
period from the impact date to two years after the date on which the 
certification is signed or earlier if the certification is terminated 
before it expires after two years.
    Agent State--This proposed definition is substantively unchanged 
from the definition and description of agent State codified in 20 CFR 
617.3(aa)(2) and 617.16(e).
    Alternative Trade Adjustment Assistance, Alternative TAA or ATAA--
This proposed term refers to the assistance provided under the 
demonstration program introduced by the Reform Act to provide an 
alternate path for adversely affected workers over the age of 50 years 
to elect to receive benefits under the Act, as discussed in

[[Page 50765]]

subpart I (reserved for publication at a later date).
    Applicable State law--This proposed definition is substantially the 
same as in 20 CFR 617.16. The wording has been changed slightly to make 
the definition more easily understood, and the separate paragraph 
addressing adversely affected workers entitled to UI under the Railroad 
Unemployment Insurance Act (RRUI) has been dropped because it is 
duplicative of paragraph (a)(2) of this definition in 20 CFR 617.16, 
which also applies to adversely affected workers entitled to UI under 
the RRUI.
    Average weekly hours--This proposed definition is the same as in 20 
CFR 617.3(e).
    Average weekly wage--This proposed definition is substantively the 
same as in 20 CFR 617.3(f). However, it replaces the phrase ``the 
individual's appropriate week'' with the phrase ``the week in which the 
individual's first separation occurred.'' This change eliminates the 
definition of ``appropriate week,'' which was referenced only one time 
in the definition of ``average weekly wage'' at 20 CFR 617.3(f). 
Therefore, the Department proposes to remove the term ``appropriate 
week,'' as defined at 20 CFR 617.3(d), from this proposed Part 618. 
This definition otherwise did not change substantively.
    Benefit period--This proposed definition is the same as in 20 CFR 
617.3(h).
    Bona fide application for training--This proposed definition is the 
same as the definition in 20 CFR 617.3(i), except that it no longer 
includes the direction to the CSA that the form must be signed and 
dated upon receipt and the form used is not required to contain the 
local office number of the CSA. Instead, proposed Sec.  618.605(b)(2) 
directs a representative of the CSA to sign and date the application 
upon receipt. Access to CSAs and their contact information via 
telephone directories and information assistance and the Internet 
obviates the need for a bona fide application for training to contain 
the local office telephone number, which may soon be outdated.
    Certification--This proposed definition modifies the definition in 
Sec.  617.3(j)(1) to include a reference to ATAA. The procedures for 
obtaining a certification will be described in the proposed subpart B 
[reserved].
    Certification period--This proposed definition is the same as in 20 
CFR 617.3(j)(2).
    Certifying officer--This proposed definition is updated from the 
definition in 20 CFR Part 617 by changing ``Office'' to ``Division'' 
and ``Part 90'' to ``Part 618.''
    Co-enrollment--This proposed term refers to an individual who is 
participating in a TAA program and is also enrolled in another program 
administered through a State's WIA One-Stop delivery system.
    Commuting area--This proposed definition is the same as in 20 CFR 
617.3(k).
    Confidential business information--This proposed definition 
replaces the definition at 29 CFR 90.33(a), and provides a more precise 
statutory basis, under the Trade Secrets Act, 18 U.S.C. 1905, for 
withholding from disclosure commercial and financial data received by 
the Department during its investigation of petitions for certification 
of worker eligibility to apply for TAA, or TAA and ATAA. Section 
90.33(a) identifies the Freedom of Information Act, 5 U.S.C. 552 
(FOIA), and the Department's regulations implementing FOIA, 29 CFR Part 
70, as the bases for designating confidential commercial information as 
``privileged or confidential.'' FOIA exemption (b)(4) exempts from 
mandatory disclosure under FOIA certain commercial or financial 
information that is the subject of a FOIA request. The Trade Secrets 
Act affirmatively prohibits the disclosure of confidential business or 
commercial information, in the absence of legal authority. The term 
``confidential business information'' is used in connection with 
disclosure of information by the Department and by the States, as in 
proposed Sec.  618.865(b).
    Cooperating State agency or CSA--This proposed term is added to 
accurately identify the agency or agencies at the State level that 
carry out provisions of the Act because of the new emphasis on 
coordination between the TAA programs and the One-Stop delivery system. 
While the proposed definition includes the ``State agency,'' as that 
term was defined in 20 CFR 617.3(ii), it also includes the State 
Workforce Agency and other State or local agencies that cooperate in 
the administration of the TAA programs under an agreement between the 
Governor and the Secretary.
    Customized training--This proposed term is newly defined to 
identify a type of training previously not referenced in the Act. While 
the Reform Act generally did not amend the job retraining provisions of 
the Act, it changed the reference to ``on-the-job training'' to 
``employer-based training, including (i) on-the-job training and (ii) 
customized training.'' The proposed definition of customized training 
refers to Sec.  618.635(b) which describes customized training 
similarly to the definition for such training under WIA.
    Date of certification--This proposed term means the same as the 
term ``date of issuance'' in 29 CFR 90.2, but has been expanded and 
renamed to avoid any suggestion that the date on which the 
certification is signed may be different from the date on which the 
certification is issued. The phrase ``for a group of adversely affected 
workers at a firm or subdivision'' is added to the proposed definition 
to indicate that the certification will identify the group of workers 
to whom it applies.
    Date of filing--This proposed definition is modified from the 
definition in 29 CFR 90.2. The current office handling petitions under 
the TAA programs, DTAA, is substituted. The definition also makes clear 
that a petition is only considered filed on the date on which DTAA 
receives a complete petition.
    Date of separation--This proposed definition is intended to have 
the same meaning as 20 CFR 617.3(l), but is rephrased slightly for 
clarity and is stated in the disjunctive to make it clear that the 
three situations listed are alternatives.
    Department of Labor or Department or DOL--This proposed term 
identifies the Department of Labor. The abbreviations are added to 
simplify references to the agency.
    Director--This proposed definition differs from the definition in 
29 CFR 90.2 by using the term Division rather than Office to reflect 
the current ETA organizational structure, and by including any person 
who is designated to act in the place of the Director.
    Division of Trade Adjustment Assistance or DTAA--This proposed 
definition refers to the name of the organization within the Employment 
Training Administration of the Department with responsibility for 
administering the TAA programs. CSAs work under the direction of DTAA 
to provide services and benefits under the TAA programs.
    Eligible ATAA recipient, Eligible PBGC pension recipient and 
Eligible TAA recipient--These proposed definitions incorporate the 
definitions the categories of persons who may be eligible to qualify 
for the health coverage tax credit under section 35 of the Internal 
Revenue Code and health insurance coverage assistance under section 
173(g) of the WIA, 29 U.S.C. 2918, as amended by the Reform Act. These 
categories are defined in sections 35(c)(3), 35(c)(4) and 35(c)(2) of 
the Internal Revenue Code, 26 U.S.C. 35(c)(3), (c)(4) and (c)(2). The 
CSA must send a list of eligible ATAA and TAA recipients to the 
Internal Revenue Service (IRS). However, only the IRS

[[Page 50766]]

can make a determination that an individual who is on that list is 
eligible to receive the HCTC.
    Employer--This proposed definition is the same as in 20 CFR 
617.3(n).
    Employment--This proposed definition is the same as in 20 CFR 
617.3(o).
    Extended compensation or Extended Benefits or EB--This proposed 
term was included in the description of unemployment compensation in 20 
CFR 617.3(oo). The proposed definition of this term has been revised to 
simplify and update Sec.  617.3(oo)(3).
    Family--This proposed definition is the same as the definition of 
this term in 20 CFR 617.3(q), which is based on the Internal Revenue 
Code definition, except for updating the date of the Internal Revenue 
Code from ``1954'' to ``1986.''
    Federal student financial assistance--This proposed term is added 
to describe the various types of student financial assistance 
authorized by title IV of the Higher Education Act of 1965, as amended 
(20 U.S.C. 1070 et seq.) and Bureau of Indian Affairs student 
assistance programs which may be available to adversely affected 
workers.
    Federal supplemental compensation--This proposed term was included 
in the description of unemployment compensation in 20 CFR 617.3(oo). 
The proposed definition of this term has been revised to simplify and 
update the language used in Sec.  617.3(oo)(4).
    Firm--This proposed definition is substantially the same as in 29 
CFR 90.2. The definition is intended to be broad enough to encompass 
all kinds of organizations and to include closely related or affiliated 
organizations. The definition is, however, limited by basic rules of 
corporate and organizational law to entities that share the indicia of 
common ownership or control.
    First benefit period--This proposed definition is substantively the 
same as in 20 CFR 617.3(r). To achieve consistency in proposed Part 
618, the term ``worker'' is used instead of ``individual,'' which is 
used in this definition in Part 617.
    First qualifying separation--This proposed definition is 
substantially changed from 20 CFR 617.3(t)(3), which defines this term 
one way for purposes of determining the weekly and maximum amounts of 
basic TRA, and another way for all the other purposes of Part 617. For 
simplification, the proposed definition of this term applies solely for 
the purpose of determining the weekly and maximum amounts of basic TRA 
and is substantively the same as at 20 CFR 617.3(t)(3)(ii). The other 
purpose for which this term is used in 20 CFR 617.3(t)(3)(i) is now 
covered in the proposed definition of ``qualifying separation'' at 
proposed Sec.  618.110.
    First separation--This proposed definition is the same as in 20 CFR 
617.3(t)(1), except that the cross reference has been deleted as 
unnecessary.
    Health Coverage Tax Credit or HCTC--This proposed term is added to 
describe the tax benefit under section 35 of the Internal Revenue Code 
of 1986 (26 U.S.C. 35) that the Reform Act makes available to qualified 
TAA and ATAA recipients.
    Impact date--This proposed definition slightly revises the 
definition of this term at 20 CFR 617.3(v) for simplicity. The impact 
date is stated in the certification for eligibility of covered workers 
to apply for TAA. As required by section 223(b)(1) of the Act, the 
impact date may not be more than one year before the date of the 
petition on which such certification was granted.
    Individual employment plan (IEP)--This is a new definition. 
Generally, an IEP is prepared after conducting a comprehensive 
assessment of the worker's employment goals and strategies to achieve 
those goals. An IEP means an ongoing strategy jointly developed by the 
participant and the case manager that identifies the participant's 
employment goals, the appropriate achievement objectives, and the 
appropriate combination of services for the participant to achieve the 
employment goals.
    Job finding club--This proposed definition is the same as the 
definition of this term in 20 CFR 617.3(y).
    Job search program or JSP--This proposed definition is the same as 
the definition of this term in 20 CFR 617.3(w).
    Job search workshop--The proposed wording of this term varies 
slightly from 20 CFR 617.3(x) to provide a clearer description, but the 
meaning is intended to be the same.
    Lack of work--This term is used in the definitions of ``adversely 
affected worker'' in section 247(2) of the Act, as well as in the 
definitions of ``adversely affected worker'' and ``layoff'' in these 
proposed regulations. Thus, the term is defined here to clarify its 
meaning. The definition includes situations where the employer is 
downsizing the workforce by attrition or offering severance benefits to 
encourage workers to leave the workforce voluntarily, and where a 
worker's hours of employment have been reduced because sufficient work 
to maintain that worker's customary hours of work is not available. A 
worker who is separated from employment under these circumstances may 
be covered as an ``adversely affected worker'' and be eligible to 
receive TAA, or TAA and ATAA. It should be noted that some workers will 
meet this definition of a ``lack of work'' separation, but will be 
disqualified for UI under State voluntary quit provisions. The UI 
disqualification will make these workers ineligible for TRA, although 
they may qualify for other forms of TAA.
    Layoff--This proposed definition follows the definition in 20 CFR 
617.3(z) and contains two minor changes to the definition of this same 
term in 29 CFR 90.2. The phrase ``suspension or separation from 
employment'' used in Sec.  617.3(z) is adopted instead of the phrase 
``suspension from pay status'' used in the definition of this term in 
Sec.  90.2 because the Department intends for ``layoff'' to include 
persons separated from employment who receive severance pay and 
therefore may be considered to be in a pay status. This definition may 
be an issue for some States, and some workers will be able to get TAA 
services other than TRA, for which they may be disqualified based upon 
the receipt of severance pay. The Department proposes using the phrase 
``expected to be for a definite or indefinite period of not less than 
seven (7) consecutive days'' from 20 CFR 617.3(z) rather than the 
phrase ``expected to last for no less than seven (7) consecutive 
calendar days,'' which is used in the definition of this term in 29 CFR 
90.2. Use of the Part 617 language will remove any ambiguity about 
whether a suspension or separation from employment may be for a 
definite or indefinite period and still be a ``layoff'' for TAA 
purposes. Additionally, use of the Part 617 language will notify CSAs 
that they must continue to measure the duration of a suspension or 
separation from employment as they have been under Part 617.
    Liable State--This proposed definition follows 20 CFR 617.3(aa) but 
is revised for simplicity. The term ``Agent State'' is now separately 
defined at proposed Sec.  618.110.
    One-Stop delivery system--This proposed term refers to the system 
of entities within a State operating under WIA and its implementing 
regulations to provide employment and training activities, including 
coordination of services to eligible dislocated workers as defined 
under section 101(9) of WIA. WIA section 121(b)(1)(B)(viii) requires 
the TAA program to be a partner in the One-Stop delivery system.
    On-the-job training (OJT)--This proposed definition, unlike the

[[Page 50767]]

definition in 20 CFR 617.3(bb), defines this term by reference to the 
on-the-job training provision at proposed Sec.  618.635(a)(1) 
(enrollment in on-the-job and customized training).
    Partial separation--This proposed definition combines the slightly 
different definitions of this term in 20 CFR 617.3(cc) and 29 CFR 90.2. 
The definition of this term in Sec.  90.2 applies to separations ``at 
the firm or appropriate subdivision thereof,'' referring to workers who 
have not yet been certified as eligible to apply for TAA. After they 
have been determined to be eligible to apply for TAA, the workers' 
``partial separation'' is referred to in Sec.  617.3(cc) as being ``in 
adversely affected employment,'' the term that the Trade Act uses in 
section 247(6) of the Act to describe the two measures of ``partial 
separation.'' The proposed combined definition retains the statutory 
criteria of ``partial separation'' to refer to both workers on whose 
behalf a petition has been filed and workers who are covered by a 
certification. The proposed definition also clarifies the meaning of 
the term by specifying that, in order for the worker to be counted as 
partially separated from adversely affected employment, the reduction 
of hours must have occurred during a week ending on or after the impact 
date specified in a certification.
    Program of remedial education--This new proposed term is used to 
refer, as the Reform Act does, to education designed to upgrade the 
basic knowledge of adversely affected workers through such courses as 
adult basic education, basic math and literacy, English-as-a-second-
language, and high school equivalency.
    Qualifying separation--This term, as defined at 20 CFR 617.3(t)(2), 
is used to determine whether an individual qualifies as an adversely 
affected worker and for basic TRA. Under the proposed definition of 
this term, it applies for both those purposes as well as for 
determining the 16-week period for enrollment in approved training and 
the basic TRA eligibility period.
    For the purpose of determining the basic TRA eligibility period 
under proposed Sec.  618.745(a), an adversely affected worker's 
eligibility for basic TRA ends at ``the close of the 104-week [or, 
under the Reform Act amendments, if necessary to complete an approved 
training program that includes remedial education, the 130-week] period 
beginning with the first week following the week in which the adversely 
affected worker's most recent qualifying separation (defined in 
proposed Sec.  618.110) occurred.'' Thus, every time an adversely 
affected worker has a ``qualifying separation,'' he or she begins a new 
basic TRA eligibility period, as provided in section 233(a)(2) of the 
Act.
    This ``movable basic TRA eligibility period'' is the same under 
proposed Part 618 as it is under Part 617 because the Reform Act did 
not amend it. However, the Part 618 regulations achieve the same result 
in a simpler fashion. Section 617.15(a) of 20 CFR provided a 104-week 
``eligibility period.'' This term is defined at 20 CFR 617.3(m)(1)(ii) 
in reference to the ``first total qualifying separation,'' which is a 
``first qualifying separation'' under 20 CFR 617.3(t)(3)(i)(B). 
However, the definition of ``eligibility period'' in Part 617 provides 
that if an individual has a ``subsequent total qualifying separation 
within the certification period of the same certification,'' that 
individual would have a new 104-week eligibility period. Thus, the Part 
617 regulations provide for a movable basic TRA eligibility period, 
through several steps by running the eligibility period from the 
``first total qualifying separation,'' and then restarting it where the 
adversely affected worker had a ``subsequent total qualifying 
separation.'' The Part 618 regulations achieve the same result, but 
more simply, by running the eligibility period from the most recent 
``qualifying separation'' (defined as, among other things, a total 
separation).
    The definition of ``qualifying separation'' is used also for the 
purpose of determining the 16-week period for enrollment in approved 
training as a condition of TRA, a deadline added by the Reform Act. 
Proposed Sec.  618.720(b)(2) establishes this deadline as the ``last 
day of the 16th week after the adversely affected worker's most recent 
qualifying separation as defined in Sec.  618.110,'' thus establishing 
a ``movable'' 16-week period for enrollment in approved training, as 
provided in section 231(a)(5)(A)(ii)(I) of the Act.
    As noted in the preamble explanation of the definition of ``first 
qualifying separation'' at proposed Sec.  618.110, that definition 
applies only for the purposes of determining the weekly and maximum 
amount of basic TRA. The proposed definition of ``qualifying 
separation'' also modifies the 20 CFR 617.3(t)(2) definition by 
eliminating outdated provisions.
    Regional Administrator--This proposed definition is substantively 
unchanged from 20 CFR 617.3(dd).
    Regular compensation--This proposed term was included in the 
description of unemployment compensation in 20 CFR 617.3(oo). The 
proposed definition of this term is the same as Sec.  617.3(oo)(1).
    Secretary--This proposed term, used to refer to the Secretary of 
Labor, United States Department of Labor, is the same as in 20 CFR 
617.3(ff).
    State--This proposed definition is the same as the definition of 
this term in 20 CFR 617.3(hh).
    State agency--This proposed definition revises the definition of 
this term used in Part 617 by incorporating the statutory definition of 
``the agency of the State which administers the State law.'' The 
proposed definition of ``CSA'' in proposed Sec.  618.110 is the same as 
the 20 CFR 617.3(ii) definition of ``State agency,'' except that 
current terminology is used instead of ``State Employment Security 
Agency.''
    State law--This proposed definition is the same as in 20 CFR 
617.3(jj), except that the reference to the Internal Revenue Code has 
been updated.
    Suitable employment--The proposed definition of ``suitable 
employment'' comes from section 236(e) of the Act, defining it as 
``work of a substantially equal or higher skill level than the worker's 
past adversely affected employment, and wages for such work at not less 
than 80 percent of the worker's average weekly wage.'' That section 
expressly states that its definition of this term applies for purposes 
of section 236. Section 236 uses the term ``suitable employment'' only 
in section (a)(1)(A) (the first criterion for the approval of 
training), providing for approval where ``there is no suitable 
employment * * * available for an adversely affected worker.''
    The term ``suitable employment'' also is used in section 
231(c)(1)(B) of the Act to permit waiver of the training requirement 
for receiving TRA where an adversely affected worker has marketable 
skills for ``suitable employment'' and there is a reasonable 
expectation of employment at equivalent wages in the foreseeable 
future. Section 231 of the Act neither incorporates the definition of 
``suitable employment'' in section 236(e) of the Act nor provides a 
different definition of the same term. The Department has determined 
that it is appropriate to apply the section 236(e) definition of the 
term in implementing section 231 of the Act because these provisions 
are interrelated. Where ``suitable employment'' is available for an 
adversely affected worker, approval of training will be denied under 
section 236(a)(1)(A) of the Act. However, the worker may need income 
support while looking for that ``suitable employment,'' which may 
depend upon a waiver of the training requirement. Using the same

[[Page 50768]]

definition of ``suitable employment'' for purposes of section 
231(c)(1)(B) of the Act allows CSAs to decide whether to deny training 
and to grant waivers on the same basis.
    Sections 237(a)(2)(B) and 238(a)(2)(B) of the Act require, as 
conditions for receipt of job search and relocation allowances, that 
``the worker cannot reasonably be expected to secure suitable 
employment in the commuting area in which the worker resides.'' In 
implementing these provisions, the Department proposes in subparts D 
and E to use the same definition of the term ``suitable employment.'' 
This is a departure from the current regulations at 20 CFR 617.32(a)(4) 
(on job search allowances) and 617.42(a)(6) (on relocation allowances) 
which interpret ``suitable employment'' to mean ``suitable work'' as 
defined in 20 CFR 617.3(kk)(1) and (2), whichever is applicable to the 
individual. ``Suitable employment'' is generally work at higher skill 
levels and wage rates than is ``suitable work.'' By changing the 
interpretation of ``suitable employment'' to have the same meaning for 
purposes of eligibility for relocation and job search allowances that 
it has in proposed subpart F of Part 618 on training, the Department 
intends to encourage workers to use these benefits in a manner 
consistent with the purpose of the program to encourage workers to seek 
new jobs with compensation levels near the levels of those jobs from 
which they were separated. This proposed regulatory change may increase 
the number of workers who qualify for job search allowances in areas 
where ``suitable employment'' opportunities are limited. On the other 
hand, using ``suitable employment'' in the eligibility criteria for 
relocation allowances could restrict the jobs for which relocation 
allowances may be paid.
    The Department invites comment on whether it should instead define 
``suitable employment'' for purposes of job search and relocation 
allowance eligibility as a job at lower wages than ``suitable 
employment'' as defined in section 236(e) of the Act for job training 
approval. A lower standard for ``suitable employment'' would have the 
beneficial effect of increasing the number of jobs for which a worker 
might obtain a job search or relocation allowance. On the other hand, 
approval for either of these allowances requires that there be no 
reasonable expectation of securing ``suitable employment'' in the 
commuting area. Therefore, a lower standard would make it more likely 
that a disqualifying ``suitable employment'' would be available 
locally. The Department also invites comment on what level would be 
appropriate, and why.
    The proposed definition of ``suitable employment'' differs slightly 
from the definition in 20 CFR 617.22(a)(1)(i) by expressly requiring 
the CSA to take into consideration the value of fringe benefits, 
including health insurance, in determining whether the level of wages 
for work is at least 80 percent of the adversely affected worker's 
average weekly wage in the adverse employment from which the worker was 
separated. The broad definition of the term ``wages'' in 20 CFR 
617.3(pp) and proposed paragraph 618.110, which includes ``all 
compensation for employment for an employer, including commissions, 
bonuses, and the cash value of all compensation in a medium other than 
cash,'' is the basis for emphasizing to the CSAs that they must 
consider fringe benefits as part of the total wage package factor in 
making determinations as to whether ``suitable employment'' is 
available to an adversely affected worker. Comments on this change in 
definition are specifically requested.
    Suitable work--The definition proposed for Part 618 is the same as 
the definition of this term in 20 CFR 617.3(kk)(1) and (2), that is, 
either as suitable work as defined in the applicable State law for 
claimants for regular compensation, or suitable work as defined in 
applicable State law provisions consistent with section 202(a)(3) of 
the Federal-State Extended Unemployment Compensation Act (EUCA) of 
1970. State unemployment insurance laws define ``suitable work'' in 
terms of a worker's job prospects. The better the job prospects, the 
higher the level of work considered suitable