Workforce Innovation and Opportunity Act Title I Non-Core Programs Effectiveness in Serving Employers Performance Indicator, 13595-13614 [2024-03279]

Agencies

• Employment and Training Administration
• DEPARTMENT OF LABOR

[Federal Register Volume 89, Number 37 (Friday, February 23, 2024)]
[Rules and Regulations]
[Pages 13595-13614]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-03279]


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DEPARTMENT OF LABOR

Employment and Training Administration

20 CFR Parts 684, 686, and 688

[Docket No. ETA-2022-0005]
RIN 1205-AC08


Workforce Innovation and Opportunity Act Title I Non-Core 
Programs Effectiveness in Serving Employers Performance Indicator

AGENCY: Employment and Training Administration (ETA), Labor.

ACTION: Final rule.

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SUMMARY: The Workforce Innovation and Opportunity Act (WIOA) 
establishes six primary indicators of performance for certain WIOA-
authorized programs and defines five of the six performance indicators. 
The U.S. Departments of Labor and Education (the Departments) published 
a final rule under RIN 1205-AC01 to define the sixth performance 
indicator--effectiveness in serving employers--as Retention with Same 
Employer into the implementing regulations for the six WIOA core 
programs. In this related final rule, the Department of Labor (DOL or 
the Department) is incorporating the same definition of the ESE 
performance indicator into regulations for the following WIOA title I 
non-core programs: the Indian and Native American (INA), the Job Corps, 
and the YouthBuild program. This final rule makes two changes from the 
notice of proposed rulemaking (NPRM) for the WIOA title I non-core 
programs: the final rule permits the use of supplemental wage 
information in the definition of the effectiveness in serving employers 
performance indicator, and it specifies that the definition is 
measuring retention in unsubsidized employment.

DATES: This final rule is effective March 25, 2024.

FOR FURTHER INFORMATION CONTACT: Michelle Paczynski, Administrator, 
Office of Policy Development and Research, U.S. Department of Labor, 
Employment and Training Administration, 200 Constitution Avenue NW, 
Room N-5641, Washington, DC 20210, Telephone: 202-693-3700 (voice) 
(this is not a toll-free number), 1-877-872-5627, or 1-800-326-2577 
(telecommunications device for the deaf).

SUPPLEMENTARY INFORMATION:

Preamble Table of Contents

I. Background and Rulemaking Authority
    A. WIOA Background
    B. Summary of Changes From NPRM to Final Rule of the 
Effectiveness in Serving Employers Performance Indicator for WIOA 
Non-Core Programs
    C. Effectiveness in Serving Employers Performance Indicator 
Approaches for WIOA Core Programs, as Relevant to WIOA Title I Non-
Core Programs
    D. Effectiveness in Serving Employers Performance Indicator for 
WIOA Title I Non-Core Programs
    E. Public Comments Received on the Proposed Rule
II. Section-by-Section Analysis of This Final Rule
    A. Comments Received on Effectiveness in Serving Employers 
Performance Indicator Approaches, as Relevant to WIOA Non-Core 
Programs
    B. Part 684--Indian and Native American Programs
    C. Part 685--National Farmworker Jobs Program
    D. Part 686--Job Corps Program
    E. Part 688--YouthBuild Programs
    F. Impacts of the Final Rule on Other Non-Core WIOA Programs for 
Which the Department Has Applied WIOA Sec. 116 Primary Indicators of 
Performance
III. 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, 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
    F. Executive Order 13175 (Indian Tribal Governments)

Acronyms and Abbreviations

AEFLA Adult Education and Family Literacy Act
AJC American Job Center
CFR Code of Federal Regulations
Departments U.S. Departments of Labor and Education
DOL or Department U.S. Department of Labor
E.O. Executive Order
ES Employment Service
ETA Employment and Training Administration
FR Federal Register
GPMS Grantee Performance Management System
ICR Information Collection Request
INA Indian and Native American
MSFW migrant and seasonal farmworker
NAETC Native American Employment and Training Council
NFJP National Farmworker Jobs Program
NPRM or proposed rule notice of proposed rulemaking
OIRA Office of Information and Regulatory Affairs
OMB Office of Management and Budget
PIRL Participant Individual Record Layout
PRA Paperwork Reduction Act of 1995
Pub. L. Public Law

[[Page 13596]]

PY Program Year
REO Reentry Employment Opportunities
RFA Regulatory Flexibility Act
RIA Regulatory impact analysis
RIN Regulation Identifier Number
Stat. United States Statutes at Large
UI unemployment insurance
UMRA Unfunded Mandates Reform Act
U.S.C. United States Code
TEGL Training and Employment Guidance Letter
VR Vocational Rehabilitation
WIOA Workforce Innovation and Opportunity Act
WIPS Workforce Integrated Performance System

I. Background and Rulemaking Authority

A. WIOA Background

    President Barack Obama signed WIOA into law on July 22, 2014. WIOA 
superseded the Workforce Investment Act of 1998 and amended the Wagner-
Peyser Act and the Rehabilitation Act of 1973. In WIOA sec. 503(f), 
Congress directed the Department to issue regulations implementing 
statutory requirements to ensure that the public workforce system 
operates as a comprehensive, integrated, and streamlined system to 
provide pathways to prosperity and continuously improve the quality and 
performance of its services to job seekers and employers. Additionally, 
WIOA sec. 189(a) permits the Secretary of Labor to prescribe rules and 
regulations to carry out title I of WIOA.
    The law includes a common performance accountability system, 
consisting of six statutory primary indicators of performance, 
applicable to all WIOA core programs: adult, dislocated worker, and 
youth programs under title I of WIOA; the Adult Education and Family 
Literacy Act (AEFLA) program under title II; the Employment Service 
(ES) program authorized under the Wagner-Peyser Act as amended by WIOA 
title III; and the Vocational Rehabilitation (VR) program authorized 
under title I of the Rehabilitation Act as amended by WIOA title IV. 
WIOA also requires that the six statutory primary indicators of 
performance apply to four WIOA title I, DOL-administered non-core 
programs: INA programs (WIOA sec. 166(e)(5)), the NFJP (WIOA sec. 
167(c)(2)(C)), Job Corps (WIOA sec. 159(c)(1)), and YouthBuild (WIOA 
sec. 171(f)(1)) (hereinafter ``title I non-core programs'').
    Although not mandated by WIOA, the Department requires several 
other DOL-administered WIOA title I non-core programs and projects also 
to report on the WIOA sec. 116 primary indicators of performance. For 
example, the Department requires Reentry Employment Opportunities (REO) 
grants (authorized under WIOA sec.169 and annual appropriation acts) to 
report on the sec. 116 primary indicators of performance. The 
Department anticipates applying the definition of the effectiveness in 
serving employers performance indicator adopted in this final rule to 
those programs.
    In WIOA, Congress directed the Department to issue regulations 
implementing statutory requirements to ensure that the public workforce 
system operates as a comprehensive, integrated, and streamlined system 
in order to provide pathways to prosperity and continuously improve the 
quality and performance of its services to job seekers and employers. 
On August 19, 2016, the Department issued the Workforce Innovation and 
Opportunity Act; Final Rule (DOL WIOA Final Rule) to implement WIOA for 
the title I non-core programs (81 FR 56071). That same day the 
Departments jointly issued the Workforce Innovation and Opportunity 
Act; Joint Rule for Unified and Combined State Plans, Performance 
Accountability, and the One-Stop System Joint Provisions; Final Rule 
(Joint WIOA Final Rule) to implement WIOA for the six core programs (81 
FR 55791).
    The WIOA statute defines five of the six performance indicators. 
However, the statute did not specify how the sixth performance 
indicator, effectiveness in serving employers, should be measured. 
Instead, WIOA directed the Departments to develop a definition for the 
effectiveness in serving employers performance indicator (WIOA sec. 
116(b)(2)(A)(iv)).\1\ At that time, the Departments concluded that 
there was not enough evidence of what should be measured to assess the 
effectiveness in serving employers to adopt a standard definition. 
Therefore, in the Joint WIOA Final Rule, the Departments determined 
that it was prudent to pilot three definitions for the sixth 
performance indicator to test the feasibility and rigor of three 
approaches to measure a State's effectiveness in serving employers 
through its WIOA-authorized core programs. As discussed more fully 
below, during the pilot period, the Department, through guidance \2\ 
and the ``DOL-Only Performance Accountability, Information, and 
Reporting System'' Information Collection Request (ICR), approved under 
Office of Management and Budget (OMB) Control Number 1205-0521, 
required the WIOA title I non-core programs to report on Retention with 
the Same Employer, one of the three definitions being piloted by the 
six WIOA core programs.
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    \1\ Section 116(b)(2)(A)(i) of WIOA states the primary 
indicators of performance: (1) the percentage of participants who 
are employed during the second and (2) fourth quarters after exit 
from the program, (3) the median earnings of participants who are 
employed during the second quarter after exit, (4) the percentage of 
participants who obtain a recognized postsecondary credential during 
the program or within 1 year of exit, (5) the percentage of 
participants who achieve measurable skill gains during a program 
year, and (6) ``indicators of effectiveness in serving employers.'' 
This last indicator is the subject of this final rule. Definitions 
of the others were included in the WIOA regulations promulgated in 
August 2016 (81 FR 55791; see 20 CFR 677.155, 34 CFR 361.155, 34 CFR 
463.155).
    \2\ ETA, TEGL No. 14-18, ``Aligning Performance Accountability 
Reporting, Definitions, and Policies Across Workforce Employment and 
Training Programs Administered by the U.S. Department of Labor 
(DOL),'' Mar. 25, 2019, https://wdr.doleta.gov/directives/corr_doc.cfm?docn=7611.
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    That pilot, as well as a study of the results from the pilot, are 
now complete. The definition in this final rule applies to both WIOA 
core programs--which are addressed in the concurrently published 
Workforce Innovation and Opportunity Act Effectiveness in Serving 
Employers Performance Indicator; Joint Final Rule (RIN 1205-AC01) 
(hereinafter referred to as Joint WIOA Effectiveness in Serving 
Employers Final Rule)--as well as the four title I non-core programs, 
which are addressed in this final rule.
    WIOA secs. 159(c)(1) (Job Corps), 166(e)(5) (INA), 167(c)(2)(C) 
(NFJP), and 171(f)(1) (YouthBuild) specify that performance for these 
title I non-core programs must be assessed using the primary indicators 
of performance in sec. 116 of WIOA. On September 14, 2022, the 
Departments published a joint NPRM in which the Departments proposed to 
codify the approach for evaluating a WIOA core program's effectiveness 
in serving employers (87 FR 56318) (Joint WIOA Effectiveness in Serving 
Employers NPRM). On the same day, DOL published an NPRM in which the 
Department proposed to codify the approach for evaluating a WIOA title 
I non-core program's effectiveness in serving employers (87 FR 56340) 
(hereinafter referred to as the NPRM).

B. Summary of Changes From NPRM to Final Rule of the Effectiveness in 
Serving Employers Performance Indicator for WIOA Non-Core Programs

    This final rule implements Retention with the Same Employer as the 
definition for effectiveness in serving employers for WIOA title I non-
core programs, as proposed in the NPRM, with two changes from the NPRM 
made in response to comments received on the Joint WIOA Effectiveness 
in Serving

[[Page 13597]]

Employers NPRM, which were also relevant to the NPRM.
    Specifically, in the Joint WIOA Effectiveness in Serving Employers 
Final Rule the Departments determined that supplemental wage 
information plays a vital role when wage records are either unavailable 
for a participant or difficult to obtain. For this reason, the 
Departments revised Sec.  677.155(a)(1)(vi) and (c)(6) in the Joint 
WIOA Effectiveness in Serving Employers Final Rule to remove the 
requirement that wage records be used to document a participant's 
employment status for purposes of the effectiveness in serving 
employers performance indicator, thereby allowing for the use of 
supplemental wage data. Second, the Joint WIOA Effectiveness in Serving 
Employers Final Rule definition for effectiveness in serving employers 
adds the requirement that the participant must have been in 
``unsubsidized employment'' in the second and fourth quarters after 
exit. The reasons for changing the Joint WIOA Effectiveness in Serving 
Employers Final Rule text also apply to the WIOA title I non-core 
programs. Therefore, the changes to the Sec.  677.155 regulatory text 
have been carried over to this final rule at revised Sec.  
684.460(a)(6) for INA Youth, revised Sec.  684.620(a)(6) for INA, 
revised Sec.  686.1010(f) for Job Corps, and revised Sec.  688.400(f) 
for YouthBuild.

C. Effectiveness in Serving Employers Performance Indicator Approaches 
for WIOA Core Programs, as Relevant to WIOA Title I Non-Core Programs

    Section 677.155 sets forth the primary indicators by which the 
performance of core programs is evaluated, as required by WIOA sec. 
116(b)(2)(A)(i). These primary indicators of performance apply to the 
core programs described in WIOA sec. 116(b)(3)(A)(ii), as well as to 
the title I non-core programs. These primary indicators of performance 
create a common language shared across the programs' performance 
metrics, support system alignment, enhance programmatic decision 
making, and help participants make informed decisions related to 
training. Sections 116(b)(2)(A)(i)(VI) and (b)(2)(A)(iv) of WIOA 
require the Secretaries of Labor and Education to jointly develop and 
establish the sixth performance indicator--effectiveness in serving 
employers--after consultation with representatives of State and local 
governments, business and industry, and other interested parties.
    In the Joint WIOA Effectiveness in Serving Employers NPRM, the 
Departments proposed to define the effectiveness in serving employers 
performance indicator in Sec.  677.155(a)(1)(vi) as the percentage of 
participants with wage records who exited a program and were employed 
by the same employer in the second and fourth quarters after exit and 
specified that this is a statewide indicator reported by one core 
program on behalf of all six core programs in the State. In the NPRM, 
the Department proposed this same language for the WIOA title I non-
core programs; however, as proposed in the NPRM, the statewide aspect 
of the proposed definition in the Joint WIOA Effectiveness in Serving 
Employers NPRM would not apply to WIOA title I non-core programs. The 
Department sought comment on how the proposed definition of 
effectiveness in serving employers performance indicator would impact 
the WIOA title I non-core programs.
    Prior to selecting this single approach to propose, the Departments 
selected three approaches for measuring effectiveness in serving 
employers to be piloted by WIOA core programs. The Departments assessed 
the use of each of the three approaches with a focus on minimizing 
employer burden and using information that would provide an accurate 
picture of how well the public workforce system serves employers.
    Under the guidance of the Departments,\3\ each State piloted its 
choice of any two of three definitions for the effectiveness in serving 
employers performance indicator for WIOA core programs: (1) Retention 
with the Same Employer: Percentage of participants with wage records 
who exited from WIOA core programs and were employed by the same 
employer in the second and fourth quarters after exit; (2) Repeat 
Business Customer: Percentage of employers who have used WIOA core 
program services more than once during the last three reporting 
periods; and (3) Employer Penetration: Percentage of employers using 
WIOA core program services out of all employers in the State.
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    \3\ This joint guidance, ``Performance Accountability Guidance 
for Workforce Innovation and Opportunity Act (WIOA) Title I, Title 
II, Title III, and Title IV Core Programs,'' was concurrently issued 
on December 19, 2016, as TEGL No. 10-16 by the Department of Labor, 
and as Office of Career, Technical, and Adult Education Program 
Memorandum 17-2 and Rehabilitation Services Administration Technical 
Assistance Circular (TAC) TAC-17-01 by the Department of Education.
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    The Departments assessed the pilot through a DOL contract that 
resulted in a final report titled Measuring the Effectiveness of 
Services to Employers: Options for Performance Measures under the 
Workforce Innovation and Opportunity Act (Final Pilot Study Report).\4\ 
Specifically, the study assessed each approach to defining the 
effectiveness in serving employers performance indicator for validity, 
reliability, practicality, and unintended consequences.\5\ Though the 
study did not definitively recommend one approach, in assessing the 
study's findings for each of the three approaches of the effectiveness 
in serving employers performance indicator, the Departments concluded 
that the Retention with the Same Employer approach provides a valid and 
reliable approach to measuring the indicator, while also placing the 
least amount of burden on States to implement.
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    \4\ S. Spaulding, et al., ``Measuring the Effectiveness of 
Services to Employers: Options for Performance Measures under the 
Workforce Innovation and Opportunity Act,'' Jan. 2021, https://wdr.doleta.gov/research/FullText_Documents/ETAOP2021-17%20Measures%20of%20Effectiveness%20in%20Serving%20Employers_Final%20Report.pdf (hereinafter ``Final Pilot Study Report'').
    \5\ See id. at 3-6 (stating that validity ``is used to assess 
whether you are measuring what you intend to measure''; that 
reliability ``refers to the ability to maintain consistency in data 
collection over time and across the organizations collecting the 
data''; that practicality means that the measure ``must be 
relatively uncomplicated and simple to administer to avoid threats 
to reliability and validity'' and ``must be practical to use in 
administrating programs''; and that unintended consequences are 
``negative consequences or behaviors that result . . . such as the 
displacement of other goals or conflict between goals'').
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D. Effectiveness in Serving Employers Performance Indicator for WIOA 
Title I Non-Core Programs

    Although the four WIOA title I non-core programs discussed in this 
rule--Job Corps, INA, NFJP, and YouthBuild--did not participate in the 
core program pilot, these title I non-core program fund recipients 
(i.e., Job Corps contractors and INA, NFJP, and YouthBuild grantees) 
have been required to report on Retention with the Same Employer since 
2019, following the issuance of Training and Employment Guidance Letter 
(TEGL) No. 14-18 on March 25, 2019.\6\ In TEGL No. 14-18, the 
Department

[[Page 13598]]

implemented WIOA's performance reporting requirements by requiring the 
title I non-core programs to use the Retention with the Same Employer 
definition of the effectiveness in serving employers performance 
indicator.
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    \6\ See Joint WIOA Final Rule, 81 FR 55791, 55845-55846 
(discussing the pilot and the three proposed definitions for the 
effectiveness in serving employers performance indicator); ETA, TEGL 
No. 10-16, ``Performance Accountability Guidance for Workforce 
Innovation and Opportunity Act (WIOA) Title I, Title II, Title III, 
and Title IV Core Programs,'' Dec. 19, 2016, https://wdr.doleta.gov/directives/corr_doc.cfm?DOCN=8226; ETA, TEGL No. 14-18, ``Aligning 
Performance Accountability Reporting, Definitions, and Policies 
Across Workforce Employment and Training Programs Administered by 
the U.S. Department of Labor (DOL),'' Mar. 25, 2019, https://wdr.doleta.gov/directives/corr_doc.cfm?docn=7611 (referring the 
title I non-core programs to TEGL No. 10-16 for a description of the 
pilot).
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    Under this final rule, the WIOA title I non-core programs will be 
subject to the same data collection and reporting requirements as they 
have been under TEGL No. 14-18. The TEGL specified that, starting in 
Program Year (PY) 2018 (or the point at which wage matching data 
becomes available to the program), the Job Corps, INA, NFJP, and 
YouthBuild programs were to begin tracking the effectiveness in serving 
employers performance indicator using the Retention with the Same 
Employer definition.
    Consistent with related guidance issued in PYs 2016, 2017, and 
2018,\7\ these programs were required to use the Workforce Integrated 
Performance System (WIPS), the online performance reporting system for 
the Department's employment and training grants,\8\ to submit 
information that would be used for calculating the effectiveness in 
serving employers performance indicator.\9\ These requirements are all 
included in an existing information collection, the WIOA Participant 
Individual Record Layout (PIRL) (ETA 9172), in the ``DOL-Only 
Performance Accountability, Information, and Reporting System'' ICR, 
approved under OMB Control Number 1205-0521.
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    \7\ ETA, Training and Employment Notice (TEN) No. 08-16, 
``Implementation of an Integrated Performance Reporting System for 
Multiple Employment and Training Administration (ETA) and Veterans' 
Employment and Training Service (VETS) Administered Programs,'' Aug. 
24, 2016, https://wdr.doleta.gov/directives/attach/TEN/TEN_08-16.pdf; ETA, TEN No. 40-16, ``Workforce Integrated Performance 
System (WIPS) User Resource Library Information Page,'' Apr. 11, 
2017, https://wdr.doleta.gov/directives/attach/TEN/TEN_40-16_Acc.pdf.; ETA, TEGL No. 14-18, ``Aligning Performance 
Accountability Reporting, Definitions, and Policies Across Workforce 
Employment and Training Programs Administered by the U.S. Department 
of Labor (DOL),'' Mar. 25, 2019, https://wdr.doleta.gov/directives/corr_doc.cfm?docn=7611.
    \8\ ETA, ``Workforce Integrated Performance System (WIPS),'' 
https://www.dol.gov/agencies/eta/performance/wips (last visited 
October 30, 2023).
    \9\ Specifically, the programs are required to report the Social 
Security Number (SSN) from the relevant participants who chose to 
disclose their SSN in order to obtain an unemployment insurance (UI) 
wage record match or may use available supplemental wage 
information, as directed in program-specific guidance. These data 
are used to identify whether a program participant's employer is the 
same in the second and fourth quarters after exit from the program.
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    By codifying the use of Retention with the Same Employer for this 
indicator, this final rule requires programs to use already-collected 
data and the existing performance reporting system, WIPS. Thus, 
programs will not have additional burden to collect and report on any 
other type of additional data to calculate and report results for other 
possible approaches to defining this performance indicator.
    Finally, TEGL No. 14-18 also put forth program-specific timelines 
for implementation of the WIOA reporting requirements factoring in data 
lags associated with the performance indicator as well as known 
implementation actions such as case management system development, 
which are further detailed in each program-specific section in the 
section-by-section discussion of the final rule below (Section II).
    In summary, for the Job Corps, INA, and YouthBuild programs, this 
final rule codifies in regulation the existing practice of reporting 
Retention with the Same Employer in order to measure a program's 
effectiveness in serving employers and adds the option for WIOA title I 
grantees and Job Corps contractors to choose to provide supplemental 
wage information on the measure. The Department will use this same 
definition for the effectiveness in serving employers performance 
indicator for the NFJP program. Existing guidance in Appendix VI of 
TEGL No. 14-18 addresses the use of supplemental wage information for 
WIOA core performance indicators, so the use of supplemental wage 
information will not be new to the regulated community. The Department 
intends to issue updated guidance regarding use of supplemental wage 
information specifically for the effectiveness in serving employers 
performance indicator for these programs.
    In the NPRM, the Department solicited comments to better inform 
implementation of the effectiveness in serving employers performance 
indicator for these programs, particularly challenges that they might 
face in implementing this proposed definition of the effectiveness in 
serving employers performance indicator; challenges they have faced 
under TEGL No. 14-18; and other definitions that might be more 
suitable.

E. Public Comments Received on the Proposed Rule

    The NPRM invited written comments from the public concerning the 
proposed rule through November 14, 2022. No commenters requested an 
extension of the comment period. The comments received may be viewed by 
entering docket number ETA-2022-0005 at https://www.regulations.gov.
    The Department received 18 comments in the docket for this 
rulemaking. Of these 18 comments, 10 were unique, 6 were form letter 
copies, 1 was a duplicate, and 1 was outside the scope of the proposed 
rule. Public sector commenters included State and local government 
agencies and one-stop operators. Non-profit sector commenters included 
professional associations and career or employment services providers. 
The Department also received comments from anonymous commenters.
    This section of the final rule provides a general overview of the 
comments received. Section II (Section-by-Section Discussion of this 
Final Rule) describes the comments in more detail and provides the 
Department's responses to them.
    Some commenters expressed overall concerns about and opposed the 
proposed Retention with the Same Employer definition of the 
effectiveness in serving employers performance indicator. Other 
commenters suggested that the Department consider other potential 
approaches for defining the effectiveness in serving employers 
performance indicator. The Department's responses to concerns about 
Retention with the Same Employer definition and suggestions for 
alternative are discussed below in Section II.A.
    With regard to impact or concerns about the four specific WIOA 
title I non-core programs subject to this rule, the Department received 
a total of three comments. The Department did not receive any comments 
on the impacts of the proposed Retention with the Same Employer 
effectiveness in serving employers definition on three of the four 
programs: NFJP, Job Corps, or YouthBuild programs. The proposed 
regulatory changes for the INA programs received one comment submission 
that expressed concerns about reporting burden for INA programs under 
the proposed rule and requested that the Department consult with the 
WIOA sec. 166 programs, the Native American Employment and Training 
Council (NAETC), and Tribal officials to develop and establish the 
effectiveness in serving employers performance indicator. Another 
commenter discussed the impact of the proposed rule on non-core WIOA 
programs providing employment services to two specific target 
demographics: justice-involved individuals and older workers. The 
Department's responses to the INA-related comments are discussed below 
in Section II.B and responses to comments for programs serving justice-

[[Page 13599]]

involved individuals and older workers are discussed below, in Section 
II.F.

II. Section-by-Section Discussion of This Final Rule

    Section II of this final rule provides the Department's responses 
to comments and explains the two changes in the final rule from the 
proposed rule. Section II.A discusses comments received on the proposed 
definition for and implementation of the effectiveness in serving 
employers performance indicator for the WIOA title I non-core programs. 
Sections II.B, II.C, II.D, and II.E address comments received on the 
proposed changes to ETA's INA program regulations (20 CFR part 684), 
NFJP regulations (20 CFR part 685), Job Corps program regulations (20 
CFR part 686), and YouthBuild program regulations (20 CFR part 688) to 
adopt Retention with the Same Employer as the definition for the 
effectiveness in serving employers performance indicator, respectively. 
Section II.F discusses comments received relating to impacts that this 
final rule could have on other non-core WIOA programs for which the 
Department has applied the WIOA sec. 116 primary indicators of 
performance.

A. Comments Received on the Effectiveness in Serving Employers 
Performance Indicator, as Relevant to WIOA Title I Non-Core Programs

Support for Retention With the Same Employer Definition
    Comments: Expressing support for Retention with the Same Employer, 
one commenter argued that Retention with the Same Employer is easy to 
administer and consistent across WIOA programs. Similarly, another 
commenter stated that it would be the least burdensome of the WIOA core 
programs' three piloted approaches to administer.
    Department Response: We appreciate commenters supporting Retention 
with the Same Employer as the definition for effectiveness in serving 
employers. We agree that this definition best aligns with WIOA 
employment performance indicators by using existing PIRL terms and data 
elements (i.e., use of ``participants,'' ``unsubsidized employment,'' 
and ``exit'') and measuring the same quarters as the employment rate 
indicators (i.e., the second and fourth quarters after program exit). 
Additionally, we agree that Retention with the Same Employer is the 
least burdensome definition of the WIOA core programs' three piloted 
measures, effectively illustrates the workforce system's ability to 
serve employers by reducing new employee turnover, and minimizes the 
burden on WIOA title I non-core grantees and Job Corps contractors and 
employers in measuring effectiveness in serving employers.
Retention With the Same Employer and Job Seeker/Worker Mobility
    Comments: One commenter expressed concern that the Retention with 
the Same Employer measure could limit job seekers' ability to move from 
low-wage jobs into higher wage jobs. Another commenter stated that 
measuring success through Retention with the Same Employer is contrary 
to American Job Center (AJC) practice and DOL guidance encouraging job 
seekers to work to gain skills and experience that allow them to move 
to higher paying jobs. A third commenter also opposed the proposed 
definition, stating that service providers do not play a significant 
role in how long a participant decides to stay with the same employer. 
Another commenter stated that high housing costs and inflation have 
caused many workers to move and change employers, and Retention with 
the Same Employer is a particularly undesirable measure in States where 
many workers are transient.
    Department Response: In the NPRM, the Department acknowledged that 
the limitations for Retention with the Same Employer could include the 
unintended consequences that this approach may be at odds with an 
employee seeking a higher paying job or employment benefits, and the 
possibility that the performance outcome for this indicator might not 
be the result of an employer receiving a service from the workforce 
development system. The Department agrees that many circumstances 
affect an employer's retention of employees, some of which may be 
outside the purview of WIOA services, including the general economy and 
business landscape of an area, which may include seasonal employers, 
transient worker populations, or industries with cyclical work cycles 
that could impact calculated retention rates. However, the Department 
determined that Retention with the Same Employer is the preferred 
approach of measuring effectiveness in serving employers, due to the 
prioritization of and weight placed on the advantages of Retention with 
the Same Employer: stable data collection mechanism, alignment with 
other employment performance indicators, and demonstrating maintained 
relationships between employers and employees. For these reasons, the 
Department defines effectiveness in serving employers for WIOA title I 
non-core programs using Retention with the Same Employer in this final 
rule.
    The Department notes that individuals who move to a new job with 
the same employer would be considered a successfully retained 
participant under this indicator because the indicator measures 
retention ``with the same employer'' in the second and fourth quarters; 
there is no requirement the participant remain in the same employment 
status (e.g., full-time vs. part-time) or position with the employer to 
count as a positive outcome. The Department also notes that the 
employer that will be measured for purposes of this indicator for this 
particular participant is not always the same employer that received 
services from a WIOA title I non-core program and initially hired the 
participant.
    The Department acknowledges that individuals may leave for higher 
wages with a new employer, but WIOA title I non-core grantees and 
program operators can seek to address these concerns in a variety of 
ways that are beneficial to both the employer and the participant, such 
as striving to find quality job placements or working with employers to 
develop career pathways and good jobs that more effectively incentivize 
participants they have hired to maintain their employment with the same 
employer. Despite these concerns, the Department is adopting the 
Retention with the Same Employer definition of the indicator for 
multiple reasons, specifically because it: is the least burdensome 
since it uses data elements reported by WIOA title I non-core grantees 
and Job Corps contractors for other performance indicators; has a 
stable data collection mechanism in that the requisite data are already 
reported via an OMB-approved information collection request; aligns 
with other employment performance indicators in that it uses similar 
terminology and data elements; and demonstrates maintained 
relationships between employers and employees, thereby demonstrating 
that the services provided by the WIOA programs not only meet the long-
term needs of the participants but also the needs of employers in each 
State. The Department gives particular weight to reporting burden, 
especially for the competitive grantees with generally less reporting 
capacity than States, in order to allow WIOA title I non-core grantees 
and Job Corps contractors to focus on services and improve the accuracy 
and completeness of the data.

[[Page 13600]]

Retention With the Same Employer and Other Aspects of Effectiveness in 
Serving Employers
    Comments: One commenter asserted that Retention with the Same 
Employer has no mechanism for linking the retention of a particular 
employee with instances of employer services being provided, therefore 
only indirectly reflecting effectiveness in serving employers and 
failing to inform strategic action to improve performance.
    Another commenter noted Retention with the Same Employer does not 
speak to ``acuity'' of a job placement (e.g., how difficult a position 
was to fill, how in demand the position is, whether the role was 
seasonal specific and not intended to maintain retention, rarity of 
skill set, or time to hire).
    One commenter asserted that the proposed measure is not a good 
indicator of WIOA program performance because it is significantly 
impacted by employers' choices as to wages, working conditions, and 
workplace culture, over which WIOA programs have little control.
    Another commenter expressed concern that Retention with the Same 
Employer would not capture all services provided to employers by 
workforce systems; in particular, services to employers that are not 
attached to WIOA-funded job seekers.
    Department Response: The Department recognizes that there are many 
factors beyond the control of the programs that can impact a 
participant's retention with the same employer. However, as noted 
previously, the Department has determined that an indication that an 
employee maintains employment with the same employer in both the second 
and fourth quarters after exiting from a WIOA program demonstrates a 
level of success for employers (i.e., successfully preparing 
participants to fill jobs that meet employers' needs), as well as a 
success for WIOA service providers in matching the employer with the 
job seeker.
    Regarding the commenter's concern that it would be inappropriate to 
only measure success for WIOA-enrolled customers, the Department notes 
that the services delivered by WIOA-funded program operators routinely 
benefit the broader employer community by increasing basic skills of 
the candidate pool, enhancing free job posting and search tools, and 
preparing workplaces and job seekers with disabilities for successful 
employment. Program participants who receive services that successfully 
prepare them to fill jobs that meet employers' needs benefit all the 
employers in the local economy, regardless of whether a specific 
employer directly received services from a grantee. Therefore, the 
Department has determined that excluding employers that have not 
received a service from a grantee under a non-core program or a Job 
Corps contractor within the reporting period is not an appropriate 
holistic measure of the workforce system's impact on Retention with the 
Same Employer.
    In fact, such an approach would be contrary to the purpose of the 
performance measure itself. For example, it would be possible for a 
participant to obtain employment as a result of services received under 
a WIOA title I non-core program, but change jobs within the first 
quarter after exiting the program to a new job where the participant 
remained for at least a year. In this final rule, the Department 
defines the effectiveness in serving employers performance indicator as 
the participant's Retention with the Same Employer in the second and 
fourth quarters after exiting the program. In other words, in this 
example, the employer that will be measured for purposes of this 
indicator for this particular participant is not the same employer that 
received services from a WIOA title I non-core program and initially 
hired the participant. Regarding concerns that the Retention with the 
Same Employer indicator does not measure the acuity of the WIOA 
participant's job placement, the Department acknowledges that this 
metric is one of many aspects of effectiveness in serving employers but 
believes that retention is an important aspect to measure as stated by 
employer representatives during stakeholder engagements. The Department 
encourages grantees and contractors under WIOA title I non-core 
programs to also measure effectiveness in serving employers using other 
methods for their own program management purposes, though these other 
methods are not required to be reviewed or submitted to the Department.
    Regarding whether the proposed indicator measures all aspects of 
effectiveness in serving employers, the Department believes there are 
many aspects to a program's effectiveness in serving employers, some of 
which are very difficult to quantify and report. Therefore, the 
Department chose one aspect of effectiveness that employers stated 
would be beneficial and can be measured across WIOA core programs and 
title I non-core programs with minimal burden to employers--employee 
retention.
Retention With the Same Employer Is Not a Good Fit for Certain Sectors
    Comments: A commenter argued that Retention with the Same Employer 
would be particularly problematic for seasonal employment in 
agriculture, hospitality, and construction. This commenter urged the 
Department to modify the statistical adjustment model to account for 
fluctuations in the seasonal workforce.
    Department Response: In cases of temporary seasonal work, WIOA 
title I non-core grantees and Job Corps contractors should strive to 
place participants into long-term employment opportunities when 
possible. While a seasonal employee may not be a positive outcome in 
the indicator, the Department understands this concern and does not 
expect grantees and Job Corps contactors to achieve a 100 percent 
positive outcome. The Department will take these factors into account 
when analyzing a grantee's performance on this indicator. For example, 
the Department could exercise its discretion when establishing 
performance goals to set feasible targets for the grantee to meet 
taking into account that programs that have high placement in seasonal 
employment might have a lower retention rate than other programs. 
Furthermore, for the INA and NFJP programs, the WIOA statute requires 
the Department to use a statistical adjustment model, when practicable. 
When the Department uses a statistical adjustment model for 
establishing effectiveness in serving employers indicator targets for 
WIOA title I non-core programs, the Department anticipates that the 
statistical adjustment model will adjust for these issues.
Performance Goals for Retention With the Same Employer
    Comment: One commenter asserted that, while the proposed measure 
might be the least burdensome of the piloted measures, meeting 
performance goals under it would be challenging and negate any cost 
savings.
    Department Response: The Department recognizes that drawbacks to 
this definition exist for the WIOA title I non-core programs, 
especially due to the unique nature of each of these programs. 
Nevertheless, the Department believes that the benefits of this 
approach outweigh those drawbacks. As explained above, the benefits of 
this definition are that Retention with the Same Employer will be 
straightforward to implement because the measure uses already-collected 
data and the existing performance reporting system, thereby

[[Page 13601]]

avoiding any additional burden. Moreover, the Department intends to 
mitigate any drawbacks, if necessary, by exercising its discretion, to 
establish appropriate performance goals and place appropriate weight on 
the effectiveness in serving employers performance indicator. WIOA 
title I non-core programs that serve youth, for example, focus on 
employment, career readiness, retention in education, and life skills 
to support youth participants in obtaining academic and career skills 
necessary to be successful in the job market, and success for youth is 
more likely to include progression in jobs. Recognizing the unique 
circumstances WIOA title I non-core programs may face, the Department 
expects variability in the reported outcomes from program to program, 
especially for programs serving youth, and intends to take this 
variability into account when negotiating levels of performance. These 
considerations are consistent with TEGL No. 14-18 guidance for 
applicability of primary performance indicators, which specifies that, 
as a general matter, participants' outcomes on the applicable primary 
indicators of performance may be relevant for negotiating levels of 
performance, decisions related to contract awards and renewal, and the 
award of competitive grants.\10\
---------------------------------------------------------------------------

    \10\ ETA, TEGL No. 14-18, ``Aligning Performance Accountability 
Reporting, Definitions, and Policies Across Workforce Employment and 
Training Programs Administered by the U.S. Department of Labor 
(DOL),'' p. 8, Mar. 25, 2019, https://wdr.doleta.gov/directives/corr_doc.cfm?docn=7611.
---------------------------------------------------------------------------

Other Approaches To Measuring Effectiveness in Serving Employers
    Comments: One commenter opposed to the proposed Retention with the 
Same Employer definition and stated that the other piloted measures for 
the WIOA core programs more directly relate to WIOA employer services 
delivered. The commenter stated that the Repeat Business Customer 
measure would reflect the employer's perception or experience of the 
quality of services received and that the Employer Penetration measure 
would represent the level of impact of employer services in a State. 
Another commenter remarked that Retention with the Same Employer was 
the least selected approach among the piloted measures for the WIOA 
core programs.
    Another commenter recommended that the Department review other 
methods of assessing effectiveness in serving employers, including: 
measuring the use of incumbent worker training to serve local 
businesses, scored based on the overall percentage of WIOA funds used 
and the number of businesses served. Another commenter recommended that 
effectiveness in serving employers should positively count any 
individual who is employed in the fourth quarter after exit and who has 
improved either their wages, benefits, or working conditions since the 
second quarter after exit, rather than only those with the same 
employer. Another commenter asserted that the proposed rule does not 
establish an objective standard for measuring effectiveness in serving 
employers, and suggested that the measure could address timeliness, 
professionalism, or English proficiency.
    Department Response: The Department appreciates these suggestions 
and acknowledges the potential benefits of the different proposed 
approaches for measuring the effectiveness in serving employers 
indicator, however the Department does not think that these metrics 
apply well to the WIOA title I non-core programs due to differences in 
program design. Additionally, the Department considered the possibility 
of implementing more than one metric for measuring effectiveness in 
serving employers. However, the Department determined a single 
indicator approach is most logistically feasible due to its alignment 
with the existing performance indicator structure (i.e., the 
performance indicators for employment in the second and fourth quarters 
after exit, which are existing performance indicators on which all 
programs already report) and its reporting burden to WIOA title I non-
core program grantees and contractors and employers relative to the 
other definitions piloted by the core programs.
    The suggested alternative approaches mentioned in the comments, 
such as Employer Penetration and Repeat Business Customer, were 
ultimately not selected as the definition for the effectiveness in 
serving employer performance indicator due to: (1) the nature of a very 
low employer penetration rate compared to all businesses within a 
State, leading to difficulties in improving the measure over time; and 
(2) the fact that a satisfied business may not need to partner with the 
State workforce system again. Additionally, these alternative measures 
are not based on existing standardized reporting mechanisms and would 
be impractical to apply to all grantees across WIOA core programs and 
WIOA title I non-core programs.
    Regarding the commenter's observation that the fewest number of 
States selected Retention with the Same Employer measure for the WIOA 
core program pilot and the commenter's interpretation that this lowest 
adoption rate indicates that States did not think it was a useful 
measure for the WIOA core program, the Department did not inquire why 
States chose certain measures during the pilot period and notes that 
there is no evidence that a lower adoption rate correlates with a lack 
of usefulness in measuring effectiveness in serving employers in the 
State . The Department notes that Retention with the Same Employer was 
the easiest measure for States to implement for the WIOA core programs 
based on it being calculated from existing PIRL elements. Therefore, it 
is plausible that fewer States chose to pilot this measure for WIOA 
core programs because they already knew how to calculate this measure 
and would not have needed to test how to implement it in their State. 
They may have wanted to assess how the two other pilot measures would 
work for WIOA core programs.
    The Department appreciates the commenters' ideas for additional 
data points to be collected and encourages WIOA title I non-core 
program grantees and Job Corps contractors to do so where it aids in 
guiding service delivery policies. Specifically, a commenter 
recommended including collecting and reporting data on: the number of 
job orders posted and number of candidates referred per posting; use of 
incumbent worker training (by percentage of WIOA funds used and number 
of businesses served); number, array, and availability of business 
services offered by a workforce development board or AJC; funding 
passed from workforce development boards or AJCs through to local 
businesses; or number of businesses engaged with Registered 
Apprenticeship opportunities through workforce development boards or 
AJCs. The Department declines to use these additional data points in 
defining the effectiveness in serving employers indicator because they 
are not applicable to all of the WIOA title I non-core programs and 
would, therefore, not further the goal of consistent performance 
measurement across all WIOA programs. In cases where the metric is a 
count of services, these suggested data collection points would merely 
measure the quantity of services provided to employers rather than the 
effectiveness of those services rather than quality or effectiveness. 
The Department believes these suggestions would measure outputs 
compared to an outcome. In most cases, an output like the number of 
services provided may not correlate to the ultimate goal, placing and 
retaining quality employees

[[Page 13602]]

in this case, and therefore is not ideal for measuring effectiveness in 
serving employers.
    Regarding suggestions that the measure could address timeliness, 
professionalism, or English proficiency of participants, the Department 
has considered these approaches, but rejects them and declines to make 
revisions. These types of factors are subjective, not easily 
measurable, and may require the use of surveys. The Department notes 
that employer satisfaction surveys introduce a higher level of burden 
and potentially inconsistent results compared to the Retention with the 
Same Employer metric. Furthermore, during previous webinars and town 
halls with State workforce agencies, members of the employer community, 
and other stakeholders that the Departments held in September and 
October 2014 to inform the development of the Joint WIOA NPRM (80 FR 
20609) and the Joint WIOA Final Rule (81 FR 55848), employers 
specifically commented that they consider satisfaction surveys 
burdensome and recommended they not be used in this indicator.
    After careful consideration of public comment opportunities, 
ongoing stakeholder engagement efforts,\11\ review of WIOA core program 
pilot data and narrative input submitted since 2017 through required 
annual performance reports for WIOA core programs,\12\ and a third-
party study, the Department is not persuaded to change course and adopt 
either of the other alternative definitions for the effectiveness in 
serving employers performance indicator for the WIOA title I non-core 
programs. Instead, as discussed above, the Department concluded that 
the Retention with the Same Employer approach provided a valid and 
reliable approach to measuring the indicator while placing the least 
amount of burden on WIOA title I non-core program grantees and Job 
Corps contractors to implement.
---------------------------------------------------------------------------

    \11\ ETA's WorkforceGPS technical assistance website provides 
access to materials from trainings and stakeholder engagements, 
including: (1) the Effectiveness in Serving Employers Resource Page 
accessible at https://performancereporting.workforcegps.org/resources/2018/01/29/21/13/Effectiveness-in-Serving-Employers-Resource-Page; (2) the 2019 Performance Accountability Training 
accessible at https://performancereporting.workforcegps.org/resources/2019/10/03/20/25/WIOA_2019_Performance_Accountability_Training; and (3) the January 
2020 Peer Learning Group event accessible at https://www.workforcegps.org/events/2020/01/13/17/40/WIOA-Performance-Peer-Learning-Group-Effectiveness-in-Serving-Employers.
    \12\ Annual performance reports can be found on ETA's website. 
ETA, ``Workforce Performance Results,'' https://www.dol.gov/agencies/eta/performance/results (last visited Oct 30, 2023).
---------------------------------------------------------------------------

Data Sources for Retention With Same Employer
    Comment: One commenter stated that workforce programs may not 
receive hiring outcome information and may be unable to report data for 
performance measures. The commenter also expressed concern that wage 
records are not readily available for Federal, military, and self-
employment, which could significantly impact the reported performance 
of States with high proportions of such employment.
    Department Response: The Department proposed that the effectiveness 
in serving employers indicator only include participants whose 
employment status is obtainable through wage records because wage 
records are the least burdensome records to use and they are the most 
standardized and statistically valid records available. Most employers 
are covered through unemployment insurance (UI) wage records and, 
therefore, wage records remain the most accurate and least burdensome 
method of calculating this indicator.
    However, the Department acknowledges that certain categories of 
employment, such as entrepreneurial employment, Federal employment, 
employment with the U.S. Postal Service and the military, and farmwork, 
are not reflected in State UI wage record databases. Additionally, 
participants are not required to provide Social Security numbers, which 
are needed to use wage records, to obtain services and some 
participants may be reluctant to share this information.
    To ensure that effectiveness in serving these additional employers 
is assessed, the Department concurs with commenters that the Retention 
with the Same Employer measure should be expanded to include the number 
of participants with wage records or supplemental wage information who 
exit during the reporting period and were employed by the same employer 
during the second quarter after exit and the fourth quarter after exit 
divided by the number of participants with wage records or supplemental 
wage information who exit and were employed during the second quarter 
after exit. Organizations collecting supplemental wage information for 
the purposes of calculating Retention with the Same Employer must be 
able to ascertain that the participant's wage information reflects the 
same establishment (which may include tax documents, payroll records, 
employer records, and follow-up surveys from program participants) in 
both the second and fourth quarters after exit.
    The Department agrees that supplemental wage information could play 
a vital role when wage records are either unavailable for a participant 
or difficult to obtain. For this reason, we have revised proposed 
Sec. Sec.  684.460(a)(6), 684.620(a)(6), 686.1010(f), and 688.400(f) to 
remove the requirement that wage records be used to document a 
participant's employment status for purposes of the effectiveness in 
serving employers performance indicator. This change allows for the 
effectiveness in serving employers indicator to include the same data 
sources as other employment-based primary indicators of performance, 
including supplemental wage information.
    As noted above, the Department also wants to make clear the final 
rule uses the term ``unsubsidized employment'' to align the 
effectiveness in serving employers performance indicator to WIOA 
statutory language, specifically referring to unsubsidized employment 
in the second and fourth quarters after exit, which are key inputs to 
this indicator's definition of Retention with the Same Employer. These 
changes to the Sec.  677.155 regulatory text for WIOA core programs 
have been carried over to this final rule at revised Sec.  
684.460(a)(6) for INA Youth, revised Sec.  684.620(a)(6) for INA, 
revised Sec.  686.1010(f) for Job Corps, and revised Sec.  688.400(f) 
for YouthBuild, where the regulatory text changes were intended to 
align with the Sec.  677.155 WIOA core programs definition of the 
effectiveness in serving employers performance indicator.

B. Part 684--Indian and Native American Programs

    Part 684 governs the INA programs authorized under WIOA sec. 166, 
including programs for Native American youth (INA Supplemental Youth 
Services). The INA programs are intended to support employment and 
training activities for INA program participants in order to develop 
more fully academic, occupational, and literacy skills and to serve 
unemployed and low-income Indian and Native American populations 
seeking to achieve economic self-sufficiency consistent with the goals 
and values of the particular communities. Where active, INA programs 
are required one-stop center partners. The Department administers these 
programs to maximize Federal commitment to support the growth and 
development of INAs and their communities as determined by 
representatives of such communities while meeting the applicable 
statutory and regulatory requirements.

[[Page 13603]]

    WIOA sec. 166(h)(2) requires the Department to reach an agreement 
with the entities described in WIOA sec. 166(c) as to the levels of 
performance required for each core indicator, including an 
effectiveness in serving employers performance indicator. The 
Department is also required to work with the NAETC to develop a set of 
performance indicators and standards for the INA adult and youth 
programs in addition to the primary indicators used to measure 
performance (WIOA sec. 166(h)(1)(A)).
    Section III.F of this document, which pertains to Executive Order 
(E.O.) 13175 (Indian Tribal Governments), summarizes details from the 
Department's efforts to engage with INA program grantees and 
representatives of Tribal entities to explain how the indicator works 
and receive feedback on concerns INA program grantees may have with the 
effectiveness in serving employers performance indicator.
    In response to the NPRM, the Department received feedback on the 
proposed use of Retention with the Same Employer as the effectiveness 
in serving employers performance indicator for INA programs.
    Comments: A commenter expressed concern that the proposed rule 
would increase the reporting burden for the INA programs under WIOA 
sec. 166 due to the greater complexity of the performance measures used 
and urged the Department to consider how effectiveness in serving 
employers performance indicator will be implemented and managed. The 
commenter suggested that grantees should not be penalized if reported 
outcomes do not meet established target levels for the effectiveness in 
serving employers performance indicator, and that the indicator should 
instead serve only as ``credit for job retention as required by the 
program.''
    The commenter also discussed the regulatory background requiring 
WIOA sec. 166 programs to be consistent with the self-determined 
economic and social development goals of the Indian, Alaska Native, and 
Hawaiian communities served, the Indian Self-Determination and 
Education Assistance Act, and the government-to-government relationship 
between the Federal Government and Indian Tribal Governments, and 
concluded that the effectiveness in serving employers performance 
measure does not meet the needs of the communities represented and 
should not be applied to the WIOA INA programs for adult and youth.
    Department Response: The Department appreciates concerns about 
reporting burden and acknowledges the challenges related to reporting 
for INA program grantees. The Department continues to work to ensure 
that all INA program grantees have the systems and resources needed to 
report the information required for this performance indicator. Part of 
this is accomplished by the Department continuing to conduct UI wage 
record matching on behalf of grantees for all employment-related 
performance indicators to mitigate any reporting burdens. Because the 
final rule adds the option for grantees to provide supplemental wage 
information, but does not require use of supplemental information, 
grantees may elect to rely on UI wage record matching as the Department 
conducts wage matching on behalf of INA grantees. The Department also 
notes that this final rule is codifying in regulations what is already 
required of grantees currently in the ``DOL-Only Performance 
Accountability, Information, and Reporting System'' ICR, approved under 
OMB Control Number 1205-0521, and therefore grantees should not see an 
increased burden in reporting on the effectiveness in serving employers 
indicator.
    The Department acknowledges the commenter's concern about the 
impact of the effectiveness in serving employers indicator on grantee 
performance reports. The Department intends to exercise its discretion 
to place appropriate weight on the effectiveness in serving employers 
performance indicator relative to other indicators of performance in 
assessing current or past grantee performance. For example, the 
Department could exercise its discretion when reviewing grantee 
performance during monitoring in order to take all indicators into 
consideration including the additional measures described in TEGL No. 
04-19, ``Waiver Authority for the INA Program and Implementation of 
Additional Indicators of Performance,'' discussed further below. The 
Department could also exercise its discretion when setting criteria in 
grant competitions, such as limiting the weight the Department places 
on previous performance of this measure or only considering it 
alongside the employment goals, economic situation, and unique 
circumstances of the individuals the grantee serves. Recognizing the 
unique circumstances WIOA title I non-core programs may face, the 
Department expects variability in the reported outcomes from program to 
program, especially for programs serving youth, and intends to take 
this variability into account when establishing levels of performance. 
These considerations are consistent with TEGL No. 14-18 guidance for 
applicability of primary performance indicators, which specifies that, 
as a general matter, participants' outcomes on the applicable primary 
indicators of performance may be relevant for establishing levels of 
performance, decisions related to contract awards and renewal, and the 
award of competitive grants.\13\
---------------------------------------------------------------------------

    \13\ ETA, TEGL No. 14-18, ``Aligning Performance Accountability 
Reporting, Definitions, and Policies Across Workforce Employment and 
Training Programs Administered by the U.S. Department of Labor 
(DOL),'' p. 8, Mar. 25, 2019, https://wdr.doleta.gov/directives/corr_doc.cfm?docn=7611.
---------------------------------------------------------------------------

    The Department also notes that WIOA sec. 166(i)(3) and the WIOA 
regulations at 20 CFR part 684, subpart I allow the Department to waive 
requirements, including performance requirements, that are inconsistent 
with the specific needs of INA grantees if certain conditions are met. 
Based on consultation with the NAETC, the Department issued guidance 
TEGL No. 04-19, ``Waiver Authority for the INA Program and 
Implementation of Additional Indicators of Performance,'' \14\ which 
explains how INA grantees can request waivers of performance 
indicators. With this final rule and consistent with this waiver 
guidance, the Department will accept and promptly make determinations 
on requests submitted by grantees for waivers of performance 
indicators, including effectiveness in serving employers, so that 
grantees can structure their performance indicators to best fit the 
economic circumstances of the communities served and improve positive 
outcomes.
---------------------------------------------------------------------------

    \14\ ETA, TEGL No. 04-19, ``Waiver Authority for the INA Program 
and Implementation of Additional Indicators of Performance,'' Aug. 
29, 2019, https://wdr.doleta.gov/directives/attach/TEGL/TEGL_4-19_acc.pdf.
---------------------------------------------------------------------------

    The Department appreciates the commenter's suggestion to use the 
effectiveness in serving employers indicator as a ``credit,'' rather 
than for assessing the performance of the grantee. However, the 
Department has determined that WIOA sec. 166(h) requires the use of all 
performance indicators under WIOA sec. 116(b)(2)(A), including the 
indicator on effectiveness in serving employers at sec. 
116(b)(2)(A)(i)(VI), for assessing performance. Moreover, the 
Department disagrees that using this measure as a ``credit'' is 
appropriate. The Department recognizes that there are many ways to 
consider the success of grantees in addition to performance measurement 
outcomes. The Department gathers qualitative information from grantees 
in grant competitions and through grant

[[Page 13604]]

monitoring to consider the totality of grantee performance. Therefore, 
the Department will not use this indicator as a ``credit.'' The 
Department notes that WIOA sec. 116(h)(2) requires the Department to 
reach agreement on the levels of performance with grantees taking into 
account economic conditions, characteristics of the individuals served, 
and other appropriate factors. The Department will take these factors 
into consideration in establishing the anticipated level of performance 
on this indicator and, as mentioned above, the Department intends to 
exercise its discretion and apply appropriate weight to the 
effectiveness in serving employers performance indicator relative to 
the other primary indicators of performance in assessing current or 
past grantee performance.
    Regarding the commenter's conclusion that performance measures do 
not meet the needs of the communities represented and should not be 
applied to the WIOA INA programs for adult and youth, the Department 
acknowledges the concerns of Tribal communities and their unique needs. 
The Department notes that WIOA makes provision for the Department to 
negotiate additional performance indicators and standards taking into 
account the needs of participants and the economic circumstances of the 
communities INA program grantees serve. See WIOA sec. 166(h)(1). The 
Department has negotiated these additional performance indicators which 
are described in TEGL No. 04-19. INA program grantee performance also 
is assessed based on these outcomes. Effectiveness in serving employers 
is not the only metric for assessing INA program grantee performance.
    We also note that WIOA requires the performance of these programs 
to be measured using the WIOA sec. 116 six statutory indicators of 
performance, including effectiveness in serving employers. 
Specifically, WIOA sec. 166(h)(2) requires the Secretary to reach 
agreement on the levels of performance for each of the primary 
indicators of performance described in WIOA sec. 116(b)(2)(A), which 
includes the effectiveness in serving employers indicator.
    Further, as explained above, the benefits of defining this measure 
using Retention with the Same Employer, including that it minimizes 
reporting burdens for INA program grantees, outweigh the drawbacks, as 
well as providing more benefits than the use of either of the other 
performance indicator definitions piloted by the core programs. To 
fulfill the intent of WIOA's common performance accountability system, 
the final rule defines effectiveness in serving employers for the INA 
programs using the Retention with the Same Employer approach so that 
the Department can measure effectiveness in serving employers 
consistently across core programs and the WIOA title I non-core 
programs.
    The commenter also requested that the Department consult with the 
WIOA sec. 166 programs, the NAETC, and Tribal officials in the 
development and establishment of the effectiveness in serving employers 
performance indicator definition. As further detailed below in Section 
III.F, the Department conducted a Tribal consultation to consult with 
Tribal leaders and WIOA sec. 166 grantees.
Section 684.460--What performance indicators are applicable to the 
supplemental youth services program?
    Section 684.460(a) sets out the performance indicators that apply 
to INA youth programs, including an indicator of the effectiveness of 
serving employers--specifically in paragraph (a)(6)--as established 
under WIOA sec. 116(b)(2)(A)(iv). The NPRM proposed to change the 
language in paragraph (a)(6) to align with the effectiveness in serving 
employers performance indicator language proposed at Sec.  
677.155(a)(1)(vi) in the Joint WIOA Effectiveness in Serving Employers 
NPRM. For the reasons discussed earlier in this section, the Department 
affirms the approach of aligning changes to Sec.  684.460(a)(6) with 
the effectiveness in serving employers performance indicator language 
adopted for WIOA core programs in the Joint WIOA Effectiveness in 
Serving Employers Final Rule.
    The final rule implements the Sec.  684.460(a)(6) changes as 
proposed, except with minor modifications reflecting the revisions made 
to Sec.  677.155(a)(1)(vi) in the Joint WIOA Effectiveness in Serving 
Employers Final Rule. Specifically, Sec.  684.460(a)(6) defines the 
required effectiveness in serving employers performance indicator as 
the percentage of participants in unsubsidized employment during the 
second quarter after exit from the program who were employed by the 
same employer in the second and fourth quarters after exit. As 
discussed above, these revisions from the proposed rule align the 
regulations for INA youth program with the Joint WIOA Effectiveness in 
Serving Employers Final Rule and remove the requirement that wage 
records be used to document a participant's employment status for 
purposes of the effectiveness in serving employers performance 
indicator, thereby allowing for the use of supplemental wage 
information. Additionally, Sec.  684.460(a)(6) now uses the term 
``unsubsidized employment'' to better align with WIOA statutory 
language, specifically referring to unsubsidized employment in the 
second and fourth quarters after exit, which are key inputs to the 
definition of Retention with the Same Employer.
Section 684.620--What performance indicators are in place for the 
Indian and Native American program?
    Section 684.620(a) lists the performance indicators used to 
evaluate the INA programs, including an effectiveness in serving 
employers performance indicator. Like the changes to Sec.  
684.460(a)(6), the Department is revising the language at Sec.  
684.620(a)(6) to define the required effectiveness in serving employers 
performance indicator as the percentage of participants in unsubsidized 
employment during the second quarter after exit from the program who 
were employed by the same employer in the second and fourth quarters 
after exit. This definition of effectiveness in serving employers at 
Sec.  684.620(a)(6) aligns with the effectiveness in serving employers 
performance indicator language at Sec.  677.155(a)(1)(vi), as discussed 
above.

C. Part 685--National Farmworker Jobs Program

    Part 685 establishes regulations for NFJP, authorized in title I, 
subtitle D of WIOA. The NFJP is a nationally directed, locally 
administered program of services for migrant and seasonal farmworkers 
(MSFW) and their dependents. Grant recipients help program participants 
acquire new skills to either stabilize or advance their agricultural 
careers or obtain employment in a new industry. The program also works 
to meet the critical need of safe and sanitary permanent and temporary 
housing for farmworkers and their families.
    Section 167(c)(3) of WIOA (29 U.S.C. 3222) requires the Department 
to use the six WIOA primary indicators of performance, including the 
effectiveness in serving employers performance indicator, to assess the 
performance of the NFJP. As explained in the proposed rule, part 685 
specifies that NFJP grantees providing career services and training 
must use the indicators of performance described in WIOA sec. 
116(b)(2)(A) (Sec.  685.400(a) and (b)) but does not list each 
performance indicator. Therefore, the Department did not propose any 
changes to part 685.

[[Page 13605]]

    NFJP housing grantees, which provide housing assistance rather than 
training and employment placement services, are required to report a 
different set of performance indicators as defined in Sec.  685.400(c), 
specifically the total number served of eligible MSFWs, other 
individuals, eligible MSFW families, and other families. Therefore, the 
revised definition of the effectiveness in serving employers 
performance indicator in 20 CFR part 677 finalized in the Joint WIOA 
Effectiveness in Serving Employers Final Rule applies to NFJP career 
services grantees but not housing grantees.
    The Department notes that this will have no noticeable change to 
procedures for career services grantees, as they already report this 
information in accordance with TEGL No. 14-18, using the Retention with 
the Same Employer definition of the performance indicator.
    No comments were received on the applicability of the effectiveness 
in serving employers performance indicator to the NFJP in response to 
the proposed rule. With the Joint WIOA Effectiveness in Serving 
Employers Final Rule, NFJP career services grantees will use the 
revised definition of the effectiveness in serving employers 
performance indicator in 20 CFR part 677.

D. Part 686--Job Corps Program

    Part 686 establishes regulations for the Job Corps program, 
authorized in title I, subtitle C of WIOA. Job Corps is a no-cost 
education and career technical training program administered by the 
Department, which includes 121 Job Corps centers across the United 
States. The program aims to help young people--ages 16 to 24--gain 
academic credentials and career technical training skills and secure 
quality employment. No comments were received on the proposed changes 
to part 686 and, thus, the Department adopts the proposed changes to 
Sec.  686.1010, with minor revisions, as described below.
    Job Corps historically has used post-separation surveys to capture 
post-program employment results. Job Corps' current surveys (OMB 
Control Number 1205-0426) are administered to participants immediately 
following the second and fourth quarters after exit and capture 
information related to whether they are employed or in an educational 
or training program during those quarters and if they have attained any 
additional certifications or credentials after exit from the program. 
In PY 2018, Job Corps revised the reporting periods in the post-
separation surveys to replace program-specific definitions of the 
second and fourth quarters after exit with the same definitions used by 
other DOL employment and training programs.
    This definitional shift created alignment with quarterly wage 
records and facilitated calculation of common exit and outcomes across 
WIOA programs. With this change in definition, Job Corps has been able 
to apply the effectiveness in serving employers performance indicator 
as it is described in TEGL No. 14-18, using the Retention with the Same 
Employer definition of the performance indicator. While the post-
separation surveys are a supplemental data source for reporting on the 
primary indicators of performance, Job Corps did not gain access to 
wage record matches, the primary data source, until the fourth quarter 
of PY 2020. All reported outcomes for Job Corps prior to this period 
were based solely on the supplemental data source. Job Corps began 
certifying its program results in WIPS for all the primary measures of 
performance, including the Retention with the Same Employer indicator, 
in the first quarter of PY 2020.
    Starting with the fourth quarter of PY 2020, Job Corps obtained 
quarterly wage record matches and, combined with the supplemental data 
from the surveys, has been able to report fully on the primary measures 
of performance, including the Retention with the Same Employer 
indicator.
Section 686.1010--What are the primary indicators of performance for 
Job Corps centers and the Job Corps program?
    Section 686.1010 lists the primary indicators used to measure the 
performance of Job Corps centers, which includes the effectiveness in 
serving employers performance indicator. This performance indicator is 
reported based on data collected from former students during the second 
and fourth quarters after exit.
    No comments were received on the applicability of the effectiveness 
in serving employers performance indicator to the Job Corps Program in 
response to the proposed rule. However, as discussed above, the final 
rule implements the Sec.  686.1010(f) changes as proposed, but with 
minor modifications reflecting the revisions made to Sec.  
677.155(a)(1)(vi) in the Joint WIOA Effectiveness in Serving Employers 
Final Rule. Specifically, revised Sec.  686.1010(f) defines the 
required effectiveness in serving employers performance indicator as 
the percentage of participants in unsubsidized employment during the 
second quarter after exit from the program who were employed by the 
same employer in the second and fourth quarters after exit.

E. Part 688--YouthBuild Programs

    Part 688 establishes regulations for the YouthBuild programs, 
authorized in title I, subtitle D of WIOA. YouthBuild is a pre-
apprenticeship program that provides education and job training 
opportunities for at risk youth (ages 16-24) who have dropped out of 
school, or subsequently re-enrolled, and meet certain other 
requirements. Program participants learn vocational skills focused on 
the construction industry, as well as other in-demand industries 
including healthcare, information technology, and hospitality, while 
also earning their high school diploma. No comments were received on 
the proposed changes to part 688 and, thus, the Department adopts the 
proposed changes to Sec.  688.400, with minor revisions, as described 
below.
Section 688.400--What are the performance indicators for YouthBuild 
grants?
    Section 688.400 lists the primary indicators used to measure the 
performance of YouthBuild programs, which also includes a performance 
indicator for effectiveness in serving employers.
    No comments were received on the applicability of the effectiveness 
in serving employers performance indicator to the YouthBuild programs 
in response to the proposed rule. However, as discussed above, the 
final rule implements the Sec.  688.400(f) changes as proposed, but 
with minor modifications reflecting the revisions made to Sec.  
677.155(a)(1)(vi) in the Joint WIOA Effectiveness in Serving Employers 
Final Rule. Specifically, finalized Sec.  688.400(f) defines the 
required effectiveness in serving employers performance indicator as 
the percentage of participants in unsubsidized employment during the 
second quarter after exit from the program who were employed by the 
same employer in the second and fourth quarters after exit.

F. Impacts of the Final Rule on Other Non-Core WIOA Programs for Which 
the Department Has Applied WIOA Sec. 116 Primary Indicators of 
Performance

    Although WIOA only mandated the use of the sec. 116 performance 
indicators for the four non-core programs addressed in this final rule, 
the Department has chosen to apply the sec. 116 performance indicators 
to other non-core programs to assess program performance, including REO 
grants (authorized under WIOA sec. 169 and

[[Page 13606]]

annual appropriations acts).\15\ The NPRM stated that, for these 
programs, the proposed definition of the effectiveness in serving 
employers performance indicator also would be applied. The Department 
maintains this same position in this final rule and intends to continue 
to apply the same definition of effectiveness in serving employers to 
these other non-core programs after publication of this final rule.
---------------------------------------------------------------------------

    \15\ Pages 2 through 5 of TEGL No. 14-18, ``Aligning Performance 
Accountability Reporting, Definitions, and Policies Across Workforce 
Employment and Training Programs Administered by the U.S. Department 
of Labor (DOL),'' provide the current list of DOL-administered non-
core programs for which DOL has chosen to apply these performance 
reporting requirements, which include programs authorized by WIOA, 
as well as programs authorized by other Federal legislation. ETA, 
TEGL No. 14-18, Mar. 25, 2019, https://wdr.doleta.gov/directives/corr_doc.cfm?docn=7611.
---------------------------------------------------------------------------

    Comment: One commenter discussed the impact of the proposed rule on 
the REO grants program, which provides employment services to justice-
involved individuals. The commenter argued that performance 
accountability for the WIOA non-core programs should reflect the 
distinct populations served by those programs (e.g., reentry programs 
help justice-involved individuals overcome barriers to employment). As 
the NPRM noted, the commenter remarked, a limitation of the Retention 
with the Same Employer measure of effectiveness in serving employers is 
that it may not reflect the career path of greatest opportunity for 
those employment program participants who seek to change their jobs for 
improved opportunities, which the commenter said is a point of 
particular concern for REO grant program participants who are 
reentering the job market after leaving the justice system. The 
commenter wrote that while gaining work experience is ``an important 
first step toward a rewarding career'' for justice-involved 
individuals, continuing with the same employer could deny them 
opportunities to achieve greater financial stability and advance in 
their careers.
    The commenter also stated a concern with the proposed requirement 
that REO programs collect and report supplemental wage information, 
discussing the ways this requirement to retain paystubs or other wage 
documentation would put a distinct burden on REO program staff to 
collect additional information and follow up with program participants. 
The commenter also expressed concern that disclosure of a program 
participant's criminal background to an employer could limit the 
participant's prospects for job placement. The commenter suggested that 
supplemental wage data should be accessible from the employment 
programs themselves, not the employers, in order to give program 
participants the best chance at moving forward and to best fulfill the 
missions of these programs.
    To address these concerns, the commenter recommended the Department 
do the following:
     Provide clear program guidance for REO program grantees on 
regulatory definitions.
     Determine that grantees can access wage record data in 
order to report employment outcomes of program participants.
     Consider other performance outcomes that would capture 
effectiveness in serving employers and provide a benefit to fair-chance 
employers, like the Federal bonding program and Work Opportunity Tax 
Credit do.
     Find measures of program performance that align with the 
goals of providing the best chances for success for justice-involved 
individuals.
    Department Response: While reporting this performance indicator 
contributes to the holistic data analysis of the workforce system, the 
Department recognizes that drawbacks to this proposed definition exist 
for the title I non-core programs, especially due to the unique nature 
of programs focused on youth and justice-involved individuals. 
Nevertheless, the Department believes that the benefits of this 
approach outweigh those drawbacks. Moreover, the Department intends to 
mitigate these drawbacks, if necessary, by exercising its discretion to 
place appropriate weight on the effectiveness in serving employers 
performance indicator relative to the other primary indicators of 
performance in assessing current or past grantee performance.
    As the commenter mentions, success for justice-involved individuals 
is more likely to include progression in jobs. Recognizing the unique 
circumstances such as this, the Department expects variability in the 
reported outcomes from program to program and intends to take this 
variability into account when negotiating levels of performance. These 
considerations are consistent with TEGL No. 14-18 guidance for 
applicability of primary performance indicators, which specifies that, 
as a general matter, participants' outcomes on the applicable primary 
indicators of performance may be relevant for negotiating levels of 
performance, decisions related to contract awards and renewal, and the 
award of competitive grants.\16\
---------------------------------------------------------------------------

    \16\ ETA, TEGL No. 14-18, ``Aligning Performance Accountability 
Reporting, Definitions, and Policies Across Workforce Employment and 
Training Programs Administered by the U.S. Department of Labor 
(DOL),'' p. 8, Mar. 25, 2019, https://wdr.doleta.gov/directives/corr_doc.cfm?docn=7611.
---------------------------------------------------------------------------

    It should be kept in mind that the effectiveness in serving 
employers performance indicator is unique among all other indicators in 
that it is employer-focused. Employers are critical partners with WIOA 
title I non-core programs in providing quality services and employment 
opportunities to program participants. Furthermore, there is anecdotal 
evidence from employers, as well as a few small studies that suggest 
justice-involved individuals tend to have lower turnover rates relative 
to the average employee.\17\ Tracking this performance indicator will 
provide further evidence to evaluate the potential employer benefit for 
hiring justice-involved individuals.
---------------------------------------------------------------------------

    \17\ Patricia M. Harris and Kimberly S. Keller, ``Ex-Offenders 
Need Not Apply: The Criminal Background Check in Hiring Decisions,'' 
Journal of Contemporary Criminal Justice, 2005, pages 6-30, https://journals.sagepub.com/doi/10.1177/1043986204271678; Jennifer Hickes 
Lundquist, Devah Pager, and Eiko Strader, ``Does a Criminal Past 
Predict Worker Performance? Evidence from One of America's Largest 
Employers,'' Social Forces, March 2018, pages 1039-1068, https://academic.oup.com/sf/article-abstract/96/3/1039/4802355?redirectedFrom=fulltext; Dylan Minor, Nicola Persico, and 
Deborah M. Weiss, ``Criminal Background and Job Performance,'' Feb. 
3 2017, https://insight.kellogg.northwestern.edu/article/should-you-hire-someone-with-a-criminal-record; Oluwasegun Obatusin and Debbie 
Ritter-Williams, ``A phenomenological study of employer perspectives 
on hiring ex-offenders,'' Cogent Social Sciences, Feb. 14, 2019, 
https://doi.org/10.1080/23311886.2019.1571730; Pamela D. Paulk, 
``The Johns Hopkins Hospital Success in Hiring Ex-Offenders,'' May 
2015, https://www.bgcheckinfo.org/sites/default/files/public/5thMtg_1-0c-Plenary_Pamela_Paulk_Presentation.pdf; SHRM Foundation, 
``2021 Getting Talent Back to Work Report,'' 2021, https://www.gettingtalentbacktowork.org/wp-content/uploads/2021/05/2021-GTBTW_Report.pdf; Prison Fellowship, ``6 Lessons for Employers 
Considering Hiring Former Prisoners,'' Prison Fellowship,'' https://www.prisonfellowship.org/resources/support-friends-family-of-prisoners/supporting-successful-prisoner-reentry/6-lessons-for-employers-considering-hiring-former-prisoners/ (last visited Nov. 9, 
2023).
---------------------------------------------------------------------------

    The Department also notes that while this indicator allows for the 
use of supplemental wage information, collecting such information is 
not mandatory. ETA will continue to conduct UI wage matching on behalf 
of reentry grantees for this and other employment-related performance 
indicators to reduce the burden of collecting this information 
manually. Therefore, it is not necessary for grantees to have access to 
wage record data to comply with this reporting requirement.

[[Page 13607]]

    The Department considered the commenter's request that the other 
performance outcomes be used such as is done with the Federal bonding 
program and the Work Opportunity Tax Credit. However, the Department 
has determined Retention with the Same Employer is appropriate after 
piloting three approaches of the effectiveness in serving employers 
performance indicator. The Department concluded that the Retention with 
the Same Employer approach provides a valid and reliable approach to 
measuring the indicator, while also placing the least amount of burden 
on REO grant recipients to implement.
    The Department will update guidance and technical assistance on 
this topic for reentry grantees as needed following the publication of 
the final rule.
    Comment: One commenter discussed the impact of the proposed rule on 
Senior Community Service Employment Program (SCSEP), which provides 
employment services to older workers. The commenter discussed the 
unique needs and employment patterns of the older workers served by 
SCSEP programs, who may have more ``fluid'' employment patterns than 
other workers due to health issues, caregiving obligations, or 
preferences for part-time employment. The commenter wrote that the 
SCSEP program it administers uses surveys to assess employer 
satisfaction and expressed interest in continuing this practice, 
stating that it provides depth of analysis and affords careful delivery 
of targeted programs utilizing strong employer partnerships. The 
commenter urged the Department to allow these assessment practices to 
continue in order to best maintain targeted SCSEP program deliverables 
for the target population of older workers.
    To address these concerns, the commenter recommended the Department 
do the following:
     Retain the current definition and practices for assessing 
effectiveness of SCSEP programs in serving employers.
     Provide clear guidance on any intentions to change 
definitions of the performance indicator of effectiveness in serving 
employers for SCSEP programs.
    Department Response: The Department notes that this indicator does 
not apply to the SCSEP program grantees, and the Department will not be 
making changes to any SCSEP definitions as a result of this rule.
    Comment: Discussing the impact of the proposed rule on non-core 
WIOA programs providing employment services to justice-involved 
individuals and older workers, a commenter argued that the Department 
has an obligation to provide clear guidance to program grantees working 
with these target populations on the implications of the rulemaking 
process and possible implementation of rule changes. Relatedly, the 
commenter suggested that the Department should continue to work with 
reentry service providers, SCSEP providers, and related stakeholders to 
best address the needs of the target populations by providing further 
opportunities to share insights, present feedback, and raise concerns 
and questions on the proposed rule.
    Department Response: The Department is committed to providing clear 
guidance and technical assistance to grantees in implementing any 
changes, and notes that this rule does not change any current practices 
for reentry providers and SCSEP providers.

III. Regulatory Analysis and Review

A. Executive Orders 12866 (Regulatory Planning and Review), 13563 
(Improving Regulation and Regulatory Review), and 14094 (Modernizing 
Regulatory Review) and Subtitle E of the Small Business Regulatory and 
Fairness Act of 1996)

    Under E.O. 12866, the 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 (Oct. 4, 1993). Section 1(b) of E.O. 14094 amends sec. 
3(f) of E.O. 14094 to define a ``significant regulatory action'' as an 
action that is likely to result in a rule that may: (1) have an annual 
effect on the economy of $200 million or more, or adversely affect in a 
material way the economy, a sector of the economy, productivity, 
competition, jobs, the environment, public health or safety, or State, 
local, territorial, or tribal governments or communities (also referred 
to as economically significant); (2) create a serious inconsistency or 
otherwise interfere with an action taken or planned by another agency; 
(3) materially alter the budgetary impact of entitlements, grants, user 
fees, or loan programs, or the rights and obligations of recipients 
thereof; or (4) raise legal or policy issues for which centralized 
review would meaningfully further the President's priorities or the 
principles set forth in the E.O. See 88 FR 21879 (Apr. 11, 2023). This 
final rule is a significant regulatory action under section 3(f) of 
E.O. 12866, as amended by E.O.14094.
    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.
1. Outline of the Analysis
    Section III.A.2 provides a summary of the results of the RIA. 
Section III.A.3 describes the need for the final rule, and Section 
III.A.4 describes the process used to estimate the costs of the final 
rule and the general inputs used, such as wages and number of affected 
entities. Section III.A.5 explains how the provisions of the final rule 
will result in quantifiable costs and presents the calculations the 
Department used to estimate them. In addition, Section III.A.5 
describes the qualitative benefits of the final rule. Section III.A.6 
summarizes the estimated first-year and 10-year total and annualized 
costs of the final rule. Finally, Section III.A.7 describes the 
regulatory alternatives considered when developing the final rule.
2. Analysis Overview
    The Department did not receive comments on the proposed rule 
economic analysis. Changes in this final rule economic analysis include 
updating wage rates and the number of affected entities to reflect the 
most recent data available. The new wage rates and affected entities 
are presented in Section III.A.4.
    The Department estimates that the final rule will result in costs 
and qualitative benefits. As shown in Exhibit 1, the final rule is 
expected to have a one-time cost of $52,223. The Department estimates 
that the final rule will result in an annualized net quantifiable cost 
of $7,435 at a discount rate of 7 percent and expressed in 2022 
dollars.

         Exhibit 1--Estimated Monetized Costs of the Final Rule
                             [2022 dollars]
------------------------------------------------------------------------
                                                               Cost
------------------------------------------------------------------------
10-Year Total with a Discount Rate of 3%................         $52,223
10-Year Total with a Discount Rate of 7%................          52,223
10-Year Average.........................................           5,222

[[Page 13608]]

 
Annualized at a Discount Rate of 3%.....................           6,122
Annualized at a Discount Rate of 7%.....................           7,435
------------------------------------------------------------------------

    The cost of the final rule is associated with rule familiarization 
for all 121 Job Corps centers and 97 career transition service 
providers for a total of 218 Job Corps entities, 53 NFJP career service 
and training grantees, 64 INA youth grantees, 97 INA adult grantees, 
and 237 YouthBuild grantees.\18\ See the costs subsections of Section 
III.A.5 (Subject-by-Subject Analysis) below for a detailed explanation.
---------------------------------------------------------------------------

    \18\ The 237 YouthBuild entities consist of grantees within each 
of the four currently active grant classes (68 grantees in the 2022 
class, 68 grantees in the 2021 class, 68 grantees in the 2020 class, 
and 34 grantees in the 2019 grant class).
---------------------------------------------------------------------------

    The Department cannot quantify the benefits of the final rule; 
therefore, Section III.A.5 (Subject-by-Subject Analysis) describes the 
benefits qualitatively.
3. Need for Regulation
    This final rule is necessary to complete implementation of the 
performance accountability requirements as discussed in the Joint WIOA 
Final Rule and required by statute. WIOA included a common performance 
accountability system, consisting of six statutory primary indicators 
of performance, applicable to all WIOA core programs: adult, dislocated 
worker, and youth programs under title I of WIOA; the AEFLA program 
under title II; the ES program authorized under the Wagner-Peyser Act 
as amended by WIOA title III; and the VR program authorized under title 
I of the Rehabilitation Act, as amended by WIOA title IV. WIOA also 
required that the six statutory primary indicators of performance apply 
to four WIOA title I, DOL-administered non-core programs: INA, NFJP, 
Job Corps, and YouthBuild (``title I non-core programs''). The statute 
defines five of the six performance indicators. However, WIOA did not 
specify how effectiveness in serving employers should be measured. 
Instead, WIOA directed the Departments to develop a definition for the 
effectiveness in serving employers performance indicator (WIOA sec. 
116(b)(2)(A)(iv)). In the Joint WIOA Final Rule, the Departments 
determined that it was prudent to pilot three definitions for the sixth 
performance indicator, which measures a State's effectiveness in 
serving employers through its WIOA-authorized programs. As explained 
earlier in this final rule, that pilot, as well as a study of the 
results from the pilot, Measuring the Effectiveness of Services to 
Employers: Options for Performance Measures Under the Workforce 
Innovation and Opportunity Act \19\ (Final Pilot Study Report), is now 
complete. The Departments are engaging in two rulemakings to 
incorporate into the WIOA regulations a standard definition of the 
performance indicator for effectiveness in serving employers. This 
performance indicator definition is meant to apply to both WIOA core 
programs--which are addressed in the concurrently published Joint WIOA 
Effectiveness in Serving Employers Final Rule--as well as the four 
title I non-core programs, which are addressed in this final rule. This 
rule codifies the use of all the primary performance indicators for the 
evaluation of title I non-core program performance--including the 
effectiveness in serving employers indicator--just as with the WIOA 
core programs.
---------------------------------------------------------------------------

    \19\ See S. Spaulding, et al., ``Measuring the Effectiveness of 
Services to Employers: Options for Performance Measures under the 
Workforce Innovation and Opportunity Act,'' Jan. 2021, Chapter 5 
(Alternative Measures and Data Sources), https://wdr.doleta.gov/research/FullText_Documents/ETAOP2021-17%20Measures%20of%20Effectiveness%20in%20Serving%20Employers_Final%20Report.pdf.
---------------------------------------------------------------------------

4. Analysis Considerations
a. Baseline for Title I Non-Core Programs: Indian and Native American, 
National Farmworker Jobs, Job Corps, and YouthBuild
    The Department estimated the costs of the final rule relative to 
the existing baseline. The Department determined that the final rule 
will result in no change from the baseline for the title I non-core 
programs. As a result, the Department estimates only the costs of rule 
familiarization for the title I non-core programs.
    WIOA secs. 159(c)(1) (Job Corps), 166(e)(5) (INA), 167(c)(2)(C) 
(NFJP), and 171(f)(1) (YouthBuild) specify that performance for these 
title I non-core programs must be assessed using the WIOA sec. 116 
primary indicators of performance for WIOA core programs. In this final 
rule, the Department is codifying the approach for evaluating a 
program's effectiveness in serving employers, as put into practice 
through previously issued guidance \20\ and the ``DOL-Only Performance 
Accountability, Information, and Reporting System'' ICR, approved under 
OMB Control Number 1205-0521 for the title I non-core programs.
---------------------------------------------------------------------------

    \20\ ETA, TEGL No. 14-18, ``Aligning Performance Accountability 
Reporting, Definitions, and Policies Across Workforce Employment and 
Training Programs Administered by the U.S. Department of Labor 
(DOL),'' Mar. 25, 2019, https://wdr.doleta.gov/directives/corr_doc.cfm?docn=7611.
---------------------------------------------------------------------------

    All title I non-core programs, except the INA Supplemental Youth 
Services program, are able to report the Retention with the Same 
Employer definition of effectiveness in serving employers performance 
indicator, as required in TEGL No. 14-18, through WIPS or GPMS. Unlike 
the other title I non-core programs, the INA Supplemental Youth 
Services program is not currently reporting, and will not immediately 
be able to report, the effectiveness in serving employers performance 
indicator. The INA Supplemental Youth Services case management system 
is available for grantees to enter data for youth participants who were 
served on or after April 15, 2023, and produces program reports. 
Because grantees are still tracking in legacy systems the data for 
participants whose services began before April, INA youth grantees 
will, for a period of time, use WIOA transition authority with regard 
to collecting and reporting on WIOA performance indicators, including 
the effectiveness in serving employers performance indicator. The 
Department is continuing, independent of this rulemaking, to build new 
functionality into the recent case management system for INA youth 
grantees that provides for the collection and reporting of the 
effectiveness in serving employers performance indicator. Therefore, 
this final rule does not impose any new cost associated with the case 
management system. When the case management system is built, the INA 
youth grantees will use it to collect and report the outcomes for the 
effectiveness in serving employers performance indicator. The use of 
the new system to report the effectiveness in serving employers 
performance indicator will impose a de minimis cost for the INA youth 
grantees. When the INA Supplemental Youth Services case management 
system is complete, the INA youth program grantees would face a de 
minimis cost associated with reporting the effectiveness in serving 
employers performance indicator in the new system.
    Exhibit 2 presents the number of entities the Department expects 
the final rule to affect. The Department provides these estimates and 
uses them to

[[Page 13609]]

calculate the cost of rule familiarization for the title I non-core 
programs.

Exhibit 2--Title I Non-Core Programs Number of Affected Entities by Type
------------------------------------------------------------------------
                       Entity type                            Number
------------------------------------------------------------------------
Job Corps:
    Current centers.....................................             121
    Career transition service providers.................              97
NFJP:
    Career services and training grantees...............              53
Indian and Native American:
    Number of INA youth grants awarded under WIOA sec.                64
     166................................................
    Grantees for the Comprehensive Services Program/INA               97
     adult program......................................
YouthBuild:
    Grantees in active grant classes....................             237
------------------------------------------------------------------------

b. Compensation Rates
    In Section III.A.5 (Subject-by-Subject Analysis), the Department 
presents the costs, including labor, associated with the final rule. 
Exhibit 3 presents the hourly compensation rates for the occupational 
categories expected to experience a change in level of effort 
(workload) due to the final rule. We use the Bureau of Labor Statistics 
(BLS) mean hourly wage rate for local government employees.\21\ To 
reflect total compensation, wage rates include nonwage factors such as 
overhead and fringe benefits (e.g., health and retirement benefits). We 
use an overhead rate of 17 percent \22\ and a fringe benefits rate of 
62 percent,\23\ which represents the ratio of average total 
compensation to average wages for State and local government workers in 
March 2022. We then multiply the sum of the loaded wage factor and 
overhead rate by the corresponding occupational category wage rate to 
calculate an hourly compensation rate.
---------------------------------------------------------------------------

    \21\ BLS, ``May 2022 National Industry-Specific Occupational 
Employment and Wage Estimates: NAICS 999300--Local Government, 
excluding schools and hospitals (OEWS Designation),'' https://www.bls.gov/oes/current/naics4_999300.htm (last updated April 25, 
2023).
    \22\ U.S. Environmental Protection Agency, ``Wage Rates for 
Economic Analyses of the Toxics Release Inventory Program,'' June 
10, 2002, https://www.regulations.gov/document/EPA-HQ-OPPT-2018-0321-0046. DOL has used 17 percent in prior final rules including 
the Adverse Effect Wage Rate Methodology for the Temporary 
Employment of H-2A Nonimmigrants in Non-Range Occupations in the 
United States Final Rule (RIN 1205-AC05), Temporary Agricultural 
Employment of H-2A Nonimmigrants in the United States (RIN 1205-
AB89), Cranes and Derricks in Construction: Railroad Roadway Work 
(RIN 1218-AD07), and Occupational Exposure to Beryllium and 
Beryllium Compounds in Construction and Shipyard Sectors Final Rule 
(RIN 1218-AD29).
    \23\ BLS, ``Employer Costs for Employee Compensation--March 
2022,'' June. 16, 2022, https://www.bls.gov/news.release/archives/ecec_06162022.pdf. Calculated using Table 1. Employer Costs for 
Employee Compensation by ownership

                                                              Exhibit 3--Compensation Rates
                                                                     [2022 dollars]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                              Hourly
                         Position                          Grade level    Base hourly      Loaded wage factor         Overhead costs       compensation
                                                                           wage rate                                                           rate
                                                                                   (a)                      (b)                      (c)   d = a + b + c
--------------------------------------------------------------------------------------------------------------------------------------------------------
Management Analyst.......................................          N/A          $43.61   $27.04 ($43.61 x 0.62)    $7.41 ($43.61 x 0.17)          $78.06
--------------------------------------------------------------------------------------------------------------------------------------------------------

5. Subject-by-Subject Analysis
    The Department's analysis below covers the estimated cost of the 
final rule.
c. Costs
    The following sections describe the costs of the final rule.
(1) DOL-Only Non-Core Programs Rule Familiarization
    INA, YouthBuild, NFJP, and Job Corps programs would need to 
familiarize themselves with the new regulation. Consequently, this will 
impose a one-time cost in the first year.
    To estimate the first-year cost of rule familiarization for INA, 
YouthBuild, NFJP, and Job Corps programs, the Department multiplied the 
estimated number of management analysts (1) by the time required to 
read and review the rule (1 hour), and by the applicable hourly 
compensation rate ($78.06/hour). We multiplied this result by the 
number Job Corps active centers (218), NFJP grantees (53), INA Youth 
program grantees (64), INA Adult program grantees (97), and the number 
of YouthBuild grantees (237). This calculation yields $52,536 in one-
time labor costs for Job Corps, NFJP, YouthBuild, INA Youth, and INA 
Adult programs to read and review the rule. Over the 10-year period of 
analysis, these estimated one-time costs result in an average annual 
cost of $5,222 undiscounted, or $6,122 and $7,435 at discount rates of 
3 and 7 percent, respectively.
d. Qualitative Benefits Discussion
(1) General Benefits of Measuring Effectiveness in Serving Employers
    The Department cannot quantify the final rule's benefits associated 
with improving the title I non-core programs' effectiveness in serving 
employers. Measuring effectiveness in serving employers allows title I 
non-core programs to set goals, monitor, and learn how to serve 
employers more effectively.\24\ Reporting a measure of effectiveness in 
serving employers also helps Federal, State, and local policymakers 
evaluate program performance and inform future policy changes to better 
meet program goals, particularly providing employers with skilled 
workers and other services.
---------------------------------------------------------------------------

    \24\ S. Spaulding, et al., ``Measuring the Effectiveness of 
Services to Employers: Options for Performance Measures under the 
Workforce Innovation and Opportunity Act (Research Report),'' Jan. 
2021, https://www.urban.org/sites/default/files/publication/104160/measuring-the-effectiveness-of-services-to-employers_1_0.pdf.
---------------------------------------------------------------------------

    The Department cannot quantify these estimated benefits because we 
do not have quantitative data on how the effectiveness in serving 
employers performance indicator has influenced program implementation 
and how much it would influence future policies.
(2) Specific Benefits of Reporting Retention With the Same Employer
    Requiring the calculation and reporting of Retention with the Same 
Employer as the effectiveness in serving employers performance 
indicator will make it easier to compare WIOA title I

[[Page 13610]]

non-core programs' effectiveness in serving employers performance 
across grant programs. Retention with the Same Employer demonstrates a 
continued relationship between the employer and participants who have 
exited WIOA programs. While many circumstances can have an impact on an 
employer's retention of employees, an indication that an employee is 
still working for the same employer in both the second and fourth 
quarters after exiting from a WIOA program demonstrates a level of 
success for both parties, as retention of an employee reduces the costs 
to the employer associated with employee turnover and retraining. Thus, 
reporting Retention with the Same Employer can help inform design and 
implementation of program services to reduce job turnover and improve 
employer-employee match quality. Improved matching and reduced turnover 
allow employees and employers to operate closer to their productive 
potential and can make it more worthwhile for employers to invest in 
training its employees and for employees to invest in learning 
employer-specific skills.
6. Summary of the Analysis
    The Department estimates the total net cost of the final rule at 
$52,223 at a discount rate of 7 percent. The Department estimates the 
annualized net cost of the final rule at $7,435 at a discount rate of 7 
percent. Exhibit 4 summarizes the estimated cost of the final rule over 
the 10-year analysis period.

         Exhibit 4--Estimated Monetized Costs of the Final Rule
                             [2022 dollars]
------------------------------------------------------------------------
                                                               Costs
------------------------------------------------------------------------
2024....................................................         $52,223
2025....................................................               0
2026....................................................               0
2027....................................................               0
2028....................................................               0
2029....................................................               0
2030....................................................               0
2031....................................................               0
2032....................................................               0
2033....................................................               0
10-Year Total with a Discount Rate of 3%................          52,223
10-Year Total with a Discount Rate of 7%................          52,223
10-Year Average.........................................           5,222
Annualized with a Discount Rate of 3%...................           6,122
Annualized with a Discount Rate of 7%...................           7,435
------------------------------------------------------------------------

7. Regulatory Alternatives
    The Department considered two alternatives to the finalized 
definition of the effectiveness in serving employers performance 
indicator. First, the Department considered requiring use of the 
Employer Penetration pilot approach, which reports the percentage of 
employers using services out of all employers in the State. This 
approach would have required counts of services provided to employers 
requiring States and local areas to report unique counts of employer 
establishments receiving services through WIOA's programs. Employer 
Penetration would require a more data-intensive analysis than the 
Retention with the Same Employer approach. Employer Penetration would 
have the benefit of capturing the extent to which employers within a 
State are engaged with WIOA-funded services and would provide State 
programs an incentive to work with additional employers. In the Final 
Pilot Report Study, the Department found weaknesses in this pilot 
approach including: (1) emphasis on quantity rather than quality or 
intensity of the employer service provided; (2) reliability issues 
associated with data entry and the process to count unique 
establishments; (3) measurement of program output rather than outcome; 
(4) potential for creation of perverse incentives to prioritize program 
breadth rather than depth in service and delivery; and (5) lack of 
sensitivity to industry sectors targeted by State and local workforce 
agencies.\25\
---------------------------------------------------------------------------

    \25\ S. Spaulding, et al., ``Measuring the Effectiveness of 
Services to Employers: Options for Performance Measures under the 
Workforce Innovation and Opportunity Act (Research Report),'' Jan. 
2021, https://www.urban.org/sites/default/files/publication/104160/measuring-the-effectiveness-of-services-to-employers_1_0.pdf.
---------------------------------------------------------------------------

    The Department considered a second regulatory alternative that 
would require the use of the Repeat Business Customer approach to the 
effectiveness in serving employers performance indicator, which reports 
the percentage of employers receiving services in a year who also 
received services within the previous 3 years. This approach to the 
effectiveness in serving employers measure requires counts of services 
provided to employers through WIOA's programs. Repeat Business Customer 
requires a more data-intensive analysis than the proposed approach of 
Retention with the Same Employer. Repeat Business Customer captures the 
extent to which employers within a State can find workers and the 
employer's level of satisfaction with the public workforce system 
services. In the Final Pilot Study Report, the Department found 
weaknesses in this pilot approach including that it: (1) may provide a 
disincentive to reach out to new employers; (2) is subject to variation 
in industry and sector economic conditions; and (3) may require a SAM 
to mitigate the weaknesses and improve implementation and 
interpretation.\26\
---------------------------------------------------------------------------

    \26\ S. Spaulding, et al., ``Measuring the Effectiveness of 
Services to Employers: Options for Performance Measures under the 
Workforce Innovation and Opportunity Act,'' Jan. 2021, https://wdr.doleta.gov/research/FullText_Documents/ETAOP2021-17%20Measures%20of%20Effectiveness%20in%20Serving%20Employers_Final%20Report.pdf.
---------------------------------------------------------------------------

    The Department prefers the Retention with the Same Employer 
approach because it has data more readily available and, therefore, it 
is less burdensome. The Retention with the Same Employer approach 
better aligns with workforce system goals of matching employers with 
job seekers and reducing turnover without the weaknesses associated 
with the other two approaches to defining the effectiveness in serving 
employers performance indicator. In addition, because title I non-core 
programs are already required to report the Retention with the Same 
Employer measure, the two alternative measures would impose new costs 
to affected entities associated with collecting data, calculation of, 
and reporting the alternative measure.

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

    The Regulatory Flexibility Act of 1980 (RFA), 5 U.S.C. 601 et seq., 
as amended by the Small Business Regulatory Enforcement Fairness Act of 
1996, Public Law 104-121 (Mar. 29, 1996), requires Federal agencies 
engaged in rulemaking to consider the impact of their proposals on 
small entities, consider alternatives to minimize that impact, and 
solicit public comment on their analyses. The RFA requires the 
assessment of the impact of a regulation on a wide range of small 
entities, including small businesses, not-for-profit organizations, and 
small governmental jurisdictions. Agencies must perform a review to 
determine whether a proposed or final rule would have a significant 
economic impact on a substantial number of small entities. 5 U.S.C. 603 
and 604.
    The Department finds that this final rule will not have a 
significant economic impact on a substantial number of small entities. 
Based on this determination, the Department certifies

[[Page 13611]]

that this final rule does not have a significant economic impact on a 
substantial number of small entities. This finding is supported, in 
large measure, by the fact that small entities are already receiving 
financial assistance under WIOA. In addition, the calculated cost of 
this rule is a one-time per-entity cost of $78.06 associated with rule 
familiarization and would therefore have a de minimis impact on any 
particular entity.
    This final rule can be expected to impact small entities within the 
Job Corps, NFJP, and INA programs. These small entities can be, for 
example, Tribal or non-profit grantees, including regionally focused 
entities. The Department has estimated costs that are new to this final 
rule. As discussed in Section III.A, the calculated cost of this rule 
is a one-time per-entity cost of $78.06 associated with rule 
familiarization and would, therefore, have a de minimis impact on any 
one particular entity. Therefore, the Department certifies that this 
final rule does not have a significant economic impact on a substantial 
number of small entities.

C. Paperwork Reduction Act

    The Department previously submitted and received OMB approval for 
the information collection discussed above (OMB Control Number 1205-
0521) in Section I, Background and Rulemaking Authority. See ICR 
Reference Number 202104-1205-003 (OMB Control Number 1205-0521). This 
final rule does not modify any of the content in the exiting OMB 
Control Number 1205-0521.

D. Executive Order 13132 (Federalism)

    E.O. 13132 aims to guarantee the division of governmental 
responsibilities between the National Government and the States and to 
further the policies of the Unfunded Mandates Reform Act of 1995 
(UMRA). Accordingly, E.O. 13132 requires executive departments and 
agencies to ensure that the principles of federalism guide them in the 
formulation and implementation of policies. Further, agencies must 
adhere to constitutional principles, examine the constitutional and 
statutory authority supporting a regulation that would limit the 
policymaking discretion of the States, and assess the need for such a 
regulation. To the extent practicable, agencies must consult State and 
local officials before implementing any such regulation.
    E.O. 13132 further provides that agencies must implement a 
regulation that limits the policymaking discretion of the States only 
where there is constitutional and statutory authority for the 
regulation and it addresses a problem of national significance. For a 
regulation administered by the States, the National Government must 
grant the States the maximum administrative discretion possible to 
avoid intrusive Federal oversight of State administration, and agencies 
must adhere to special requirements for a regulation that preempts 
State law. E.O. 13132 also sets forth the procedures that agencies must 
follow for certain regulations with federalism implications, such as 
preparation of a summary impact statement.
    Accordingly, the Department has reviewed this WIOA-required final 
rule and has concluded that the rule has no Federalism implications. 
This final rule has no substantial direct effects on States, on the 
relationships between the States, or on the distribution of power and 
responsibilities among the various levels of government as described by 
E.O. 13132. Therefore, the Department has concluded that this final 
rule does not have a sufficient Federalism implication to warrant the 
preparation of a summary impact statement.

E. Unfunded Mandates Reform Act

    UMRA directs agencies to assess the effects of Federal regulatory 
actions on State, local, and Tribal governments, as well as the private 
sector. A Federal mandate is any provision in a regulation that imposes 
an enforceable duty upon State, local, or Tribal governments, or 
imposes a duty upon the private sector that is not voluntary.
    Following consideration of the above factors, the Department has 
concluded that this final rule contains no unfunded Federal mandates, 
which are defined in 2 U.S.C. 658(6) to include either a ``Federal 
intergovernmental mandate'' or a ``Federal private sector mandate.'' No 
additional burden related to reporting the effectiveness in serving 
employers performance indicator is being placed on State, local, and 
Tribal governments, as this information already is being collected and 
reported on. Furthermore, the reporting is a contingent to receiving 
Federal program funding. Any associated reporting mandate cannot, 
therefore, be considered ``unfunded.'' Because the decision by a 
private training entity to participate as a provider under a WIOA core 
program is purely voluntary, the information collection burden does not 
impose a duty on the private sector that is not voluntarily assumed.

F. Executive Order 13175 (Indian Tribal Governments)

    The Department reviewed this final rule, as well as the Joint WIOA 
Effectiveness in Serving Employers Final Rule published concurrently 
with this final rule elsewhere in this issue of the Federal Register, 
under the terms of E.O. 13175 and DOL's Tribal Consultation Policy (77 
FR 71833 (Dec. 4, 2012)) and has determined that it will have Tribal 
implications, because the final rule would have substantial direct 
effects on: one or more Indian Tribes; the relationship between the 
Federal Government and Indian Tribes; or the distribution of power and 
responsibilities between the Federal Government and Indian Tribes. 
Therefore, the Department prepared a Tribal summary impact statement.
Engagement With Indian Tribes
    The Department engaged with INA grantees and the Tribal community 
at several points in this rulemaking. Prior to issuing the NPRM, the 
Department held two events to consult with INA program grantees and 
representatives of Tribal institutions about their experiences with the 
implementation and operation of the effectiveness in serving employers 
performance indicator. These two events consisted of a town hall 
meeting attended both in person and virtually and a formal consultation 
webinar. The town hall, entitled ``Town Hall Discussion: Effectiveness 
in Serving Employers Performance Indicator,'' occurred on September 21, 
2021, at the 41st National Indian and Native American Employment and 
Training conference.\27\ The consultation webinar, entitled ``Tribal 
Consultation for WIOA Effectiveness in Serving Employers Indicator 
Proposed Rulemaking,'' occurred on October 19, 2021.\28\ At the 
consultation webinar, the Department provided an opportunity for 
stakeholders to submit written feedback through DOL's Tribal 
consultation email account by October 29, 2021. The Department did not 
receive any written

[[Page 13612]]

feedback through DOL's Tribal consultation email account but received 
one letter after the consultation period for October 2021 consultation 
webinar, which raised similar issues to those articulated at the 
consultation event and summarized below. This letter was not formally 
considered during the development of the NPRM due to the late nature of 
its submission, though it raised similar issues to those articulated at 
the consultation event and summarized below.
---------------------------------------------------------------------------

    \27\ NAETC, ``41st National Indian and Native American 
Employment and Training Program,'' Sept. 20-23, 2021, https://www.ninaetc.net/41%20NINAETC%20PROGRAM_FINAL.pdf.
    \28\ DOL, ``Tribal Consultation for WIOA Effectiveness in 
Serving Employers Indicator Proposed Rulemaking,'' https://www.workforcegps.org/events/2021/09/14/13/57/Tribal-Consultation-for-WIOA-Effectiveness-in-Serving-Employers-Indicator-Proposed-Rulemaking (last visited Nov. 10, 2023); see also ``Tribal 
Consultation; Workforce Innovation and Opportunity Act, 
Implementation of the Effectiveness in Serving Employers Performance 
Indicator; Notice of Tribal Consultation; Virtual Meeting,'' 86 FR 
54244 (Sept. 30, 2021).
---------------------------------------------------------------------------

    After the release of the NPRM, the Department discussed the NPRM 
with NAETC at the October 2022 NAETC meeting.\29\ During this 
discussion, the Department encouraged submission of comments on the 
NPRM. In response to the NPRM, the Department received one public 
comment submission, which is discussed above in Section III.F, and that 
requested that the Department consult with the WIOA sec. 166 programs, 
the NAETC, and Tribal officials in order to develop and establish the 
performance indicator.
---------------------------------------------------------------------------

    \29\ Meeting proceedings are located on the NAETC web page. ETA, 
``Native American Employment and Training Council,'' https://www.dol.gov/agencies/eta/dinap/council (last visited Nov. 10, 2023).
---------------------------------------------------------------------------

Summary of Concerns
    These various engagements provided the Department with feedback 
from the INA community, Tribal representatives, and the general public 
that indicating several areas of interest concerning the definition of 
the effectiveness in serving employers performance indicator for WIOA 
programs. These concerns are summarized below.
Employer, Wage, or Position Changes
    Consultation participants expressed concern about impacts of 
individuals changing employers for higher wages or different positions. 
Specifically, several consultation participants asked how the Retention 
with the Same Employer definition of the performance indicator would 
apply to individuals who have continuous employment through the second 
and fourth quarters, but with different employers. Some consultation 
participants expressed concern that this definition of the performance 
indicator would not consider individuals who advance to better 
employment opportunities. One consultation participant expressed 
concern that the program would be penalized if employees change 
employers.
Temporary, Seasonal, and Youth Employment
    Many consultation participants expressed concern about how 
temporary jobs, such as seasonal or contract-based employment, would be 
considered. Specifically, one consultation participant gave an example 
of contractor jobs where individuals may not stay with the same 
employer and instead change from job to job, such as in construction. 
Additionally, another consultation participant stated that employers 
that regularly lay off and then rehire employees would affect outcomes.
    A consultation participant asked if this measure applies to the INA 
youth program. Another consultation participant expressed concern about 
the impact on performance of limited-duration summer employment 
opportunities for high school students within INA youth programs. The 
consultation participants also questioned DOL's willingness to invest 
in developing a data collection and reporting process for INA youth 
programs.
    Other consultation participants expressed concern about how 
seasonal jobs would be addressed and that certain areas have more 
seasonal employment than other areas do. Another consultation 
participant stated that individuals who participate in the program on a 
short-term basis while serving time with the Department of Corrections 
and later return to a different State may impact the performance 
indicator calculation. A different consultation participant stated that 
many participating employers primarily provide entry-level positions 
focused on gaining work experience.
Performance Indicator Calculation
    Many consultation participants inquired about how the performance 
indicator is calculated. One consultation participant asked a question 
in which the sound quality of the audio was not clear. However, the 
subject-matter expert interpreted the question to ask if supplemental 
wages are considered. One consultation participant stated that UI 
records may not capture individuals who are self-employed. Another 
consultation participant said that certain States do not have access to 
UI information that would enable them to calculate the performance 
indicator.
    Many consultation participants suggested other ways to calculate 
the performance indicator. Examples provided by one consultation 
participant included employer satisfaction surveys, number of employers 
served, number of repeat employers, and number of job fairs coordinated 
with employers. Another consultation participant said they measure 
success when an employer enquires about recent graduates to fill open 
positions. A different consultation participant stated that they 
understood the options DOL considered for how to measure effectiveness 
in serving employers to include how well programs have assisted 
employers in hiring new employees through job fairs, work experience to 
full[hyphen]time hires, pre[hyphen]screening of candidates, and 
individual hiring events for specific employers.
Tribal Community Impacts
    Some consultation participants had questions and comments about how 
the performance indicator would specifically impact Tribal communities. 
One consultation participant expressed the need for consideration of 
all Tribal communities and their unique needs. The consultation 
participant stated that measures used for all INA programs must not 
only satisfy the intent of the performance indicator but also be 
meaningful, which is part of the purpose of WIOA sec. 166. The 
commenter also suggested that grantees should establish a work group 
within the NAETC to develop information to share with Tribal leaders so 
that they have background and can communicate what these performance 
indicators would mean for INA programs.
    Another consultation participant cited the DOL-commissioned third-
party study of the performance indicator, ``Measuring the Effectiveness 
of Service to Employers,'' and questioned why some States with many 
Indian and Native American participants were not included in the pilot 
study. The consultation participant also asked if any INA WIOA programs 
were included in the study. Additionally, a consultation participant 
said that DOL is seeking support from Tribes on how to measure a 
performance indicator they may not want.
Process Questions and Other Observations
    Many consultation participants asked questions about the rulemaking 
process and how the Department decided on the proposed definition of 
the performance indicator. Some consultation participants asked if this 
performance indicator is required. One consultation participant asked 
if the performance indicator can be customized based on the grantee's 
status, for example with different requirements for rural and urban 
programs. A different consultation participant asked if DOL would 
decide after consultation with Tribes whether or not to apply the 
performance indicator to INA programs. Other consultation participants 
asked if the definition of this performance

[[Page 13613]]

indicator would be permanent or if it would be re-evaluated in the 
future. Additionally, a consultation participant asked if they could 
review the draft rule with others before it is published, when the 
proposed rule would be published, and when the final rule would take 
effect.
    A consultation participant asked if other performance indicator 
definitions have been submitted for consideration, for example from the 
NAETC. Another consultation participant stated that grantees with 
direct employer relationships differ from grantees that work with AJCs 
to facilitate employment for employers. Additionally, a consultation 
participant asked how grantees can assist participants who are facing 
issues at a new employment site, such as being picked on or treated 
unfairly, and whether it would be appropriate to act as a mediator 
between the employer and the participant.
Need for the Regulation
    The Department appreciates the valuable feedback received through 
these engagements with INA program grantees and representatives of 
Tribal institutions and has considered this feedback carefully in 
crafting this final rule and its planned implementation. The 
effectiveness in serving employers performance indicator is required by 
the WIOA statute for the INA program, as WIOA sec. 166(h)(2) requires 
using the primary indicators of performance described in sec. 
116(b)(2)(A). Therefore, the Department has determined that a standard 
definition for the effectiveness in serving employers performance 
indicator would be proposed and finalized for the INA program. As such, 
the Department is aligning its definition of this indicator for the 
sec. 166 INA program with the WIOA Effectiveness in Serving Employers 
Joint Final Rule.
    However, the Department acknowledges the concerns raised through 
the consultations. In recognition of these concerns, the Department 
intends to take several steps to address these matters. First, as 
discussed above in Section III.F, the Department will exercise its 
discretion to place appropriate weight on the effectiveness in serving 
employers performance indicator in assessing INA grantee performance. 
The Department recognizes the unique circumstances INA grantees may 
face and the expects variability in the reported outcomes from program 
to program, especially for programs serving youth, and intends to take 
this variability into account when establishing levels of performance. 
These considerations are consistent with TEGL No. 14-18 guidance for 
applicability of primary performance indicators, which specifies that, 
as a general matter, participants' outcomes on the applicable primary 
indicators of performance may be relevant for establishing levels of 
performance, decisions related to contract awards and renewal, and the 
award of competitive grants.
    Second as explained above in Section I.D and III.F, the Department 
notes that the selected measure should not impose any additional burden 
on INA program grantees as the definition of the effectiveness in 
serving employers measure will not require any additional reporting 
from INA program grantees above what is currently collected for the 
approved ``DOL-Only Performance Accountability, Information, and 
Reporting System'' ICR.
    Finally, the Department reaffirms the ability of INA program 
grantees to request a waiver of performance indicators as described in 
TEGL No. 04-19, ``Waiver Authority for the INA Program and 
Implementation of Additional Indicators of Performance,'' and discussed 
above in Section III.F. As part of the implementation of this final 
rule, the Department will provide dedicated technical assistance to INA 
program grantees regarding the use of this indicator.

List of Subjects

20 CFR Part 684

    Employment, Grant programs--labor, Indians, Reporting and 
recordkeeping requirements.

20 CFR Part 686

    Employment, Grant programs--labor, Job Corps.

20 CFR Part 688

    Employment, Grant programs--labor, Youth, YouthBuild.

    For the reasons discussed in the preamble, the Department of Labor 
proposes to amend 20 CFR parts 684, 686, and 688 as follows:

PART 684--INDIAN AND NATIVE AMERICAN PROGRAMS UNDER TITLE I OF THE 
WORKFORCE INNOVATION AND OPPORTUNITY ACT

0
1. The authority citation for part 684 continues to read as follows:

    Authority: Secs. 134, 166, 189, 503, Pub. L. 113-128, 128 Stat. 
1425 (Jul. 22, 2014).

Subpart D--Supplemental Youth Services

0
2. Amend Sec.  684.460 by revising paragraph (a)(6) to read as follows:


Sec.  684.460  What performance indicators are applicable to the 
supplemental youth services program?

    (a) * * *
    (6) The percentage of participants in unsubsidized employment 
during the second quarter after exit from the program who were employed 
by the same employer in the second and fourth quarters after exit.
* * * * *

Subpart F--Accountability for Services and Expenditures

0
3. Amend Sec.  684.620 by revising paragraph (a)(6) to read as follows:


Sec.  684.620  What performance indicators are in place for the Indian 
and Native American program?

    (a) * * *
    (6) The percentage of participants in unsubsidized employment 
during the second quarter after exit from the program who were employed 
by the same employer in the second and fourth quarters after exit.
* * * * *

PART 686--THE JOB CORPS UNDER TITLE I OF THE WORKFORCE INNOVATION 
AND OPPORTUNITY ACT

0
4. The authority citation for part 686 continues to read as follows:

    Authority: Secs. 142, 144, 146, 147, 159, 189, 503, Pub. L. 113-
128, 128 Stat. 1425 (Jul. 22, 2014).

Subpart J--Performance

0
5. Amend Sec.  686.1010 by revising paragraph (f) to read as follows:


Sec.  686.1010  What are the primary indicators of performance for Job 
Corps centers and the Job Corps program?

* * * * *
    (f) The percentage of participants in unsubsidized employment 
during the second quarter after exit from the program who were employed 
by the same employer in the second and fourth quarters after exit.

PART 688--PROVISIONS GOVERNING THE YOUTHBUILD PROGRAM

0
6. The authority citation for part 688 continues to read as follows:

    Authority: Secs. 171, 189, 503, Pub. L. 113-128, 128 Stat. 1425 
(Jul. 22, 2014).

[[Page 13614]]

Subpart D--Performance Indicators

0
7. Amend Sec.  688.400 by revising paragraph (f) to read as follows:


Sec.  688.400  What are the performance indicators for YouthBuild 
grants?

* * * * *
    (f) The percentage of participants in unsubsidized employment 
during the second quarter after exit from the program who were employed 
by the same employer in the second and fourth quarters after exit; and
* * * * *

Julie A. Su,
Acting Secretary of Labor.
[FR Doc. 2024-03279 Filed 2-22-24; 8:45 am]
BILLING CODE 4510-FN-P