Request for Information on Direct and Indirect Labor, 77487-77488 [2024-21709]

Agencies

• Committee for Purchase From People Who Are Blind or Severely Disabled

[Federal Register Volume 89, Number 184 (Monday, September 23, 2024)]
[Notices]
[Pages 77487-77488]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-21709]


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COMMITTEE FOR PURCHASE FROM PEOPLE WHO ARE BLIND OR SEVERELY DISABLED


Request for Information on Direct and Indirect Labor

AGENCY: Committee for Purchase from People Who Are Blind or Severely 
Disabled.

ACTION: Request for information.

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SUMMARY: The Committee for Purchase From People Who Are Blind or 
Severely Disabled (operating as the U.S. AbilityOne Commission 
(Commission)) is seeking information on proposed definitions of direct 
labor and categories of indirect labor; and ideas about categorizing 
employment tasks as direct labor or indirect labor on Federal contracts 
for the purposes of compliance with the Javits-Wagner-O'Day (JWOD) Act 
(41 U.S.C. Chapter 85). The information provided in response to this 
request for information (RFI) will inform the Commission as it seeks to 
modernize the AbilityOne Program.

DATES: Comments must be received by October 22, 2024.

ADDRESSES: Electronic Submission of Comments. Please submit any 
comments electronically through https://www.regulations.gov and follow 
the instructions for submitting comments. To locate the RFI, search for 
Docket No. CPPBSD-2024-0010.
    Accessible Format: Individuals with disabilities can obtain this 
document, as well as the comments or other documents in the public 
rulemaking record for this RFI, in an alternative accessible format by 
contacting the individual listed in the FOR FURTHER INFORMATION section 
of this document.
    Electronic Access to This Document: The official version of this 
document is the document published in the Federal Register. You may 
access the official edition of the Federal Register and the Code of 
Federal Regulations at www.govinfo.gov. You may also access Commission 
documents published in the Federal Register by using the article search 
feature at: www.federalregister.gov.

FOR FURTHER INFORMATION CONTACT: Cassandra Assefa, Regulatory and 
Policy Attorney, Office of General Counsel, Committee for Purchase From 
People Who Are Blind or Severely Disabled, 355 E Street SW, Suite 325, 
Washington, DC 20024; telephone: (202) 430-9886; email: 
[email protected].

SUPPLEMENTARY INFORMATION:

I. Background

    In 1938, the legislation that became the JWOD Act was signed to 
create jobs for blind individuals. In 1971, the Act was amended to 
expand the JWOD Program's scope to include employing individuals with 
severe disabilities.\1\ In 2006, the JWOD Program was renamed the 
AbilityOne Program by the Committee for Purchase From People Who Are 
Blind or Severely Disabled. In 2011, the Committee began operating as 
the U.S. AbilityOne Commission.
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    \1\ 41 U.S.C. Chapter 85, Committee For Purchase From People Who 
Are Blind or Severely Disabled.
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    The JWOD Act continues to serve as an employment catalyst by making 
it mandatory for Federal agencies to procure certain products and 
services from NPAs employing individuals who are blind or have 
significant disabilities. The Commission votes to place on a

[[Page 77488]]

Procurement List suitable products and services that government 
agencies must then procure from a qualified nonprofit agency (NPA). 
Federal agencies do not have to follow the normal government 
competitive procedures when acquiring Procurement List items from an 
authorized NPA, making it more efficient for both the Federal agencies 
and the qualified NPA.\2\
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    \2\ Federal Acquisition Regulation 8.7, Acquisition From 
Nonprofit Agencies Employing People Who Are Blind or Severely 
Disabled.
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    For an NPA to be eligible to provide goods or services on the 
Procurement List, it must be authorized by the Commission as qualified 
to serve as an authorized source in the program.

II. The Direct Labor Hour Ratio Mandate

    To serve as an authorized source, an NPA must, at a minimum, 
satisfy the statutory conditions described at 42 U.S.C. 8501, 
paragraphs 6 and 7. Of note, part (C) of both paragraphs require that 
75 percent of the direct labor hours required to produce or provide 
products or services must be performed by individuals who are blind or 
significantly disabled.
    In calculating the 75 percent direct labor hour ratio, an NPA is 
required to count not only the DLH performed in support of Procurement 
List items, but pursuant to the statute, all direct labor performed by 
every individual employed by the NPA.\3\ The statute defined direct 
labor as all work required to prepare, process, and pack a product, or 
work that directly relates to the performance of the service. The 
statute specifically excludes supervision, administration, inspection, 
or shipping as direct labor.
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    \3\ 41 U.S.C. 8501(6)(C) and (7)(C).
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    This means that when calculating the 75 percent direct labor hour 
ratio, an NPA excludes ``indirect labor'' hours--i.e., ``Work that 
supports the manufacturing process or delivery of services but does not 
directly produce or add value to the products or services sold to a 
customer. This includes supervision, administration, inspection, and 
shipping.'' \4\ Historically, these exclusions were perceived as 
helpful because they reduce the number of hours an NPA must count 
toward the 75% direct labor hour ratio. However, when an employee who 
is blind or has a significant disability moves from a direct labor hour 
position to an indirect labor hour position, the NPA cannot count that 
employee's indirect labor hours toward the 75 percent direct labor hour 
ratio--a situation that potentially creates a disincentive for the NPA 
to promote that employee to a supervisory or administrative position.
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    \4\ U.S. AbilityOne Commission Policy 51.404, Direct Labor Hour 
Ratio Requirements, effective October 1, 2024.
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    The Commission believes that many ``indirect labor'' task or 
positions could serve as an opportunity to promote employee career 
advancement. However, there is little incentive for an NPA to create a 
framework that actively encourages direct labor hour employees to move 
to indirect labor hour positions if doing so compromises the NPA's 
ability to remain in the Program by impeding its ability to meet the 
Program's direct labor hour ratio requirement.

III. Request for Information

    As noted above, section 8501, paragraphs 6 and 7 of the JWOD Act 
list the qualifications for an NPA to serve as an authorized source for 
a product or service on the Procurement List. The Commission's 
interpretation of the statutory language is promulgated in the Code of 
Federal Regulations (CFR) at Title 41, Chapter 51. More specifically, 
the CFR adopts the JWOD Act's 75 percent direct labor hour ratio 
requirement and adds a list of additional qualifications under Part 51-
4. In the CFR at Part 51-1.3, the Commission does not elaborate on the 
statutory direct labor hour ratio requirement or the definition of 
direct labor.
    Commission policies are generally derived from Commission 
regulations grounded in statute. As such, the authority to deviate from 
the 75 percent direct labor hour ratio requirement, or to redefine what 
counts as direct labor, is expressly limited by statute. 
Notwithstanding these limitations, the Commission is exploring ways to 
leverage its regulatory and sub-regulatory authority to encourage 
employment opportunities that promote career mobility without 
conflicting with the JWOD Act. This RFI is designed to collect 
information for that purpose, through the questions below.

IV. Questions

    (1) How could direct labor be defined to expand the types of tasks 
or positions that can be counted as direct labor without conflicting 
with the definition in the JWOD Act? The purpose of this change would 
include increasing the number of direct labor hours that an NPA could 
count toward meeting the direct labor hour ratio requirement.
    (2) In what ways could indirect labor categories (e.g., 
supervision, administration, inspection, or shipping) be defined to 
maximize employee career development without adversely impacting the 
ratio requirement, and without a statutory change?
    (3) What types of jobs or tasks traditionally categorized as 
``indirect labor'' in accordance with the JWOD Act fall outside of 
``supervision, administration, inspection, or shipping''?
    (4) With respect to meeting the direct labor hour ratio 
requirement, describe any challenges or successes associated with 
facilitating or supporting AbilityOne employees' mobility into jobs 
outside the Program; particularly, whether such mobility causes 
challenges with ratio compliance, and if applicable, the steps taken to 
mitigate such challenges.

Michael R. Jurkowski,
Director, Business Operations.
[FR Doc. 2024-21709 Filed 9-20-24; 8:45 am]
BILLING CODE 6353-01-P